The following report is intended to give you a good overview how our project group worked on the tasks of the Picsim-Simulation Project. We start with explaining our point of departure for the tasks in phase two. Moreover, this paper describes the results of the tasks no. 1, 3 and 4. Firstly, which values are those of our starting point for phase two? We used the results from our run no. 10 from the first phase of the experiments. This case is the base case for all following results we got. How did we reach these results of run no. 10? First, we worked with try and error. That means that in the beginning we just chose some values by chance and looked which results we got. After that we started using the method of Cycle Planning (CP). After using CP and improving our results we reached the results of run no. 10 which you can find in the appendix.
To be able to explain our results better and more detailed we decided to explain all the figures from the SIPOC chart. What means SIPOC and what contains this figure? SIPOC is a term used in the Six-Sigma methodology. Its name results from the parts of the Top-Level-Process Design: Suppliers (S), Inputs (I), Process (P), Outputs (O), and Customers (C). SIPOC is a tool used by a team to identify all relevant elements of a process improvement. Moreover, it makes sure that all members of a team have the same understanding of the process which is to improve. The results from the SIPOC analysis are made visible in a very clear form by the use of a SIPOC diagram. In our case it contains the Flow time efficiency and the Added value time ratio.
Now we have to make sure what is meant by Flow time efficiency and Added value time ratio. Firstly, the answer to Flow time efficiency. Flow time efficiency is an indication we get by comparing the average flow time with the theoretical value, it is the ratio between those two factors. The relationship between them is as follows: Secondly, the Added value time ratio is the coefficient which you get if you correlate the Added value time and the Non-added value time. The formula to this relationship is: The Added value time ratio contains the percentage of workers or machine utilization because this coefficient gives you the percentage of effective work. Non-added value time contains waiting time, setup time and transportation. [...]
Table of Contents
Introduction
Task 1 Setup time reduction
Task 3 Order stategies
Description of the order strategies
Batch size calculation
Comparison of the order quantities
Impacts on given production system
Task 4 Operation curves
Conclusions and guidelines
Project Goals and Scope
The primary objective of this project is to analyze and optimize manufacturing operations within the Picsim-Simulation environment, focusing specifically on reducing setup times, evaluating different order strategies, and understanding the behavior of operation curves to achieve an optimal cost-service level balance.
- Reduction of setup times at bottleneck work centers to increase system efficiency.
- Comparative analysis of lot sizing procedures, including ROP, EOQ, PPB, POQ, and Cyclic Planning.
- Optimization of order quantities to minimize total costs while maintaining a service level of at least 98%.
- Examination of the relationship between lead time, safety stock, and system flexibility.
- Derivation of actionable guidelines for improving synchronized process flow and reducing work-in-process inventory.
Excerpt from the Book
Description of the order strategies
The lead time represents the time lag between the arrival of the replenishment and the time the order was placed. The throughput is in our case equal to the weekly demand rate. The reorder point represents a predetermined level of inventory, which is the available inventory at the time when it is necessary to place a new order. Whenever the inventory drops below this level, enough parts are available to cover the demand during the replenishment lead time. To cushion the uncertainty of demand variation or delay in the lead time, it is also possible to extend the reorder point quantity about a certain amount of safety stock, as it is illustrated in figure 3.1.
Summary of Chapters
Introduction: Provides an overview of the project group's methodology, emphasizing the transition from initial trial-and-error to systematic Cycle Planning and the application of Six-Sigma SIPOC analysis to improve process understanding.
Task 1 Setup time reduction: Investigates the impact of setup time reductions on system costs and service levels, identifying work centers 1 and 4 as the primary capacity constraints.
Task 3 Order stategies: Evaluates five distinct lot sizing procedures to determine their effect on batch sizes, total costs, and inventory turnover rates.
Task 4 Operation curves: Analyzes the dynamic relationships between input parameters like safety stock, lead time, and order quantity and their resulting effects on system behavior and costs.
Conclusions and guidelines: Summarizes key findings, recommending prioritized setup time reductions at identified bottlenecks to achieve a more synchronized and cost-effective production system.
Keywords
Manufacturing Operations, Setup Time Reduction, Order Strategies, Economic Order Quantity, Cycle Planning, Six-Sigma, SIPOC, Flow Time Efficiency, Safety Stock, Lead Time, Production System, Inventory Turnover, Cost Optimization, Service Level, Batch Size
Frequently Asked Questions
What is the core purpose of this project?
The project aims to analyze and improve manufacturing operations by simulating different scenarios to optimize cost-efficiency and service levels within the Picsim environment.
Which key performance indicators are utilized?
The team uses Flow Time Efficiency, Added Value Time Ratio, and a custom Project Performance Indicator (PPI) that balances service levels against total costs.
What is the main objective of Task 1?
Task 1 focuses on determining the impact of setup time reductions on system performance and identifying which work centers contribute most significantly to cost reduction.
How are the various order strategies compared?
The strategies are compared based on their ability to minimize total costs while guaranteeing at least a 98% service level for the end products.
What does the "Little Law" imply in this context?
The Little Law is used to explain that inventory levels are a result of flow rate times flow time; increasing flow time (lead time) effectively acts as artificial safety stock but increases WIP.
What is the significance of the Six Sigma approach mentioned?
The project uses Six Sigma assumptions regarding statistical demand spread to calculate necessary safety stocks required to mitigate the risk of stock-outs under worst-case demand scenarios.
Why was the Periodic Order Quantity (POQ) identified as the best strategy?
POQ provided the total cost minimum because it resulted in the fastest average turnover rates for WIP and semi-finished/finished goods inventory.
What are the identified constraints in the process?
The experimental analysis identified work centers 1 and 4 as the primary capacity constraints of the production process.
- Quote paper
- Matthias Hintze (Author), 2005, Analysis and improvement of the setup time reduction effect, the order strategies and the operating curves of manufacturing operations, Munich, GRIN Verlag, https://www.grin.com/document/44611
