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MGSC 395 Week 4 Notes

by: Rachel Whitbeck

MGSC 395 Week 4 Notes MGSC 395

Rachel Whitbeck
GPA 4.0

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These notes cover what we went over in class from Wednesday, February 17 through Wednesday, February 24. Includes "The Goal" discussion, product mix, and line balancing.
Operations Management
Pearse Gaffney
Class Notes
Operations Management, Management Science
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This 5 page Class Notes was uploaded by Rachel Whitbeck on Wednesday February 24, 2016. The Class Notes belongs to MGSC 395 at University of South Carolina taught by Pearse Gaffney in Spring 2016. Since its upload, it has received 158 views. For similar materials see Operations Management in Business, management at University of South Carolina.

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Date Created: 02/24/16
MGSC 395 MW 5:30 Wednesday, February 17, 2016 THE GOAL DISCUSSION - Alex Rogo: main character, newly appointed plant manager - Jonah: Alex’s old college physics professor, mentors Alex through turning the plant around  Throughput: the rate at which the system generates money through “sales”  Inventory: all the money the system has invested in purchasing things to “sell” o Contrary to what we teach even today, inventory is money that’s tied up, it’s more of a liability  Operational expense: all the money the system spends in order to turn inventory into throughput - The goal is to make money - “Herbie” or the bottleneck sets the pace. o Dependent event- everyone is dependent on Herbie to get to the campsite o Statistical fluctuations- happen when the boy scouts spread out due to all their different paces Theory of constraints o Identify the system’s constrains (--> NCX-10 machine in The Goal) o Decide how to exploit the constraint (--> stagger lunch breaks so the constraining machine is never idle) o Subordinate everything else to that decision (--> Red tags are top priority, and green tags come second) o Elevate the system’s constraints (--> bring back the old Zmegma machine to help the NCX-10 and increase capacity// or outsource o If you break a bottleneck, do not let inertia set in; go back to step 1!! Monday, February 22, 2016  Bottleneck identification o It has the highest total process time per unit o It has the highest average utilization and total workload o Drum – Buffer – Rope  Drum: sets the pace; pacemaker  Buffer: inventory put in front of the bottleneck  Product Mix (example 5.2 and 5.3) (Use a spreadsheet for the homework) Traditional Method o 5 workstations: V, W, X, Y, Z o 40 hour work week o Product Demand Price R.M. Contribution Margin A 60/week $75/unit $10/unit $65/unit B 80 72 5 67 C 80 45 5 40 D 100 38 10 28 o Product Flow and process time A V(30min) --> x(10min) --> Y(10min) B X(20) --> Y(10) C W(5) --> X(5) --> Y(5) --> Z(5) D W(15) --> Y(5) --> Z(10) o Priority based on contribution margin B A C D o Workstation Mins available Mins after 80 B*Mins after 60 A at start V 2400 2400 600 W 2400 2400 2400 X 2400 800 200 Y 2400 1600 1000 Z 2400 2400 2400 *B is top priority, and 80 is the demand for B. Multiply the number demanded by the number of minutes required at the workstation in the flow and process time chart  According to theory of constraints, manage the bottleneck o In this problem, the bottleneck managed us instead, so there’s another method: the bottleneck method  The Bottleneck Method o Calculate the CM per minute at the bottleneck o Product Demand Price Resource CM CM/unit Materials @ BN A 60/week $75/unit $10/unit $65/unit 6.50 B 80 72 5 67 3.35 C 80 45 5 40 8.00 D 100 38 10 28 N/A* *Doesn’t go through bottleneck o New priority based on contribution margin per minute at bottleneck D C A B o Workstation Mins available Mins after 80 D Mins after 60 C Etc… at start V 2400 2400 2400 W 2400 900 500 X 2400 2400 2000 Y 2400 1900 1500 Z 2400 1400 1000 Wednesday, February 24, 2016  Line balancing: The assignment of work to stations in a line process to achieve the desired output with the fewest workstations possible  Steps o Step 1: Separate all the work into elements o Step 2: Get time estimates for each element o Step 3: Identify the immediate predecessor for each element o Step 4: Calculate the line’s cycle time  C = 1/r , where r is the demand rate o Step 5:  a) Calculate the theoretical minimum number of workstations. o TM = ∑t/c , which is the sum of the times for each machine over the cycle time you got in step 4 o If TM is 4.61, you round up and that new number is called “n” o This means that 90 seconds (the cycle time in the example in class) are available at each of the 5 workstations.  b) Balance the line. o Bar graph like in class o Step 6: Calculate idle time, efficiency, balance delay.  Idle time- just add together the time not used at each workstation  % Efficiency = (∑t/nc) x 100 o See notebook paper for full example  In this class, we can only do steps 4 – 6.  The term balance delay isn’t actually used in the real world. It’s just the percentage of inefficiency


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