6. Production Ativity Control

The time arrives when plans must be executed, when material requirements planning and capacity requirements planning have been completed and the detail purchasing and production schedules must be determined and released for execution. The function of production activity control (PAC)--often called shop floor control (SFC)---is to have activities performed as planned, to re­port on operating results, and to revise plans as required to achieve desired result

Order release, dispatching, and progress reporting are the three primary functions of PAC. Dispatching is the activation of orders per original plans. Dispatching decisions are affected by queue management, I/O control, and priority control principles and techniques that are intertwined and mutually supportive. They are useful in the management of lead-time, queue length, work center idle time, and scheduled order completion. Reports on the status of orders, materials, queues, tooling, and work center utilization are essential for control. Many report types with various information are possible. Examining a given situation will reveal which reports and information are required.

Production activity control (PAC) is responsible for executing the MPS and the MRP. At the same time, it must make good use of labor and machines, minimize work-in-process inventory and maintain customer service.

The MRP authorizes PAC:
- To release work orders to the shop for manufacturing;
- To take control of work orders and make sure they are completed on time;
- To be responsible for the immediate detailed planning of the flow of orders through manufacturing, carrying out the plan and controlling the work as it progresses to completion;
- To manage day-to-day activity and provide the necessary support.

The flow of work through each of the work centers must be planned to meet delivery dates, which means PAC must do the following:
- Ensure that the required materials, tooling, personnel and information are available to manufacture the components we needed;
- Schedule start and completion dates for each shop order at each work center so the scheduled completion date of the order can be met. This will involve the planner in developing a load profile for the work centers.

Once the plans are made, PAC must put them into action by advising the shop floor what must be done. Usually instructions are given by issuing a shop order. PAC will:
- Gather the information needed by the shop floor to make the product;
- Release orders to the shop floor as authorized by the MRP. This is called dispatching.

Once plans are made and shop orders released, the process must be monitored to learn what is actually happening. The results are compared to the plan to decide whether corrective action is necessary. PAC will do the following:
- Rank the shop orders in desired priority sequence by work center and establish a dispatch list based on this information;
- Track the actual performance of work orders and compare it to planned schedules. Where necessary, PAC must take corrective action by replanning, rescheduling or adjusting capacity to meet final delivery requirements;
- Monitor and control work-in-process, lead times and work center queues;
- Report work center efficiency, operation times, order quantities and scrap.

Dispatch list.

Once all the operations are scheduled and the material has been picked and delivered to the work center, you can print a dispatch list to keep track of work order and work center status. A dispatch list (or query) displays by work center all work orders with operations scheduled for that work center in the following order:

All work orders, completed but not yet moved to another work center.
All active (started) work orders (in-process and in-setup).
All work orders which are ready to start (in queue and coming).
All work orders on hold.


Orders that have tooling, material, and capacity have a good chance of being completed on time and can be released to the shop floor.

Other orders that do not have all of the necessary elements should not be released because they only cause excess work-in-process inventory and may interrupt work on orders that can be completed.

The process for releasing an order is shown in the side Figure.




























Implementation is arrived at by issuing a shop order to manufacturing authorizing them to proceed with making the item. A shop packet is usually compiled which contains the shop order and whatever other information is needed by manufacturing. It may include any of the following:

- Shop order showing the shop order number, the part number, name, description and quantity;

- Engineering drawings;

- Bills of materials;

- Route sheets showing the operations to be performed, equipment and accessories needed, material to use and the setup and run times;

- Material issue tickets that authorize manufacturing to get the required material from stores;

- Tools requisitions authorizing manufacturing to withdraw necessary tooling from the tool crib;

- Job tickets for each operation to be performed. The worker can log on and off the job using the job ticket and it then becomes a record of that operation;

- Move tickets that authorize and direct the movement of work between operations.

Manufacturing Strategy

Manufacturing processes can be conveniently broken down into 3 categories:

- Flow manufacturing,
- Intermittent manufacturing,
- Project manufacturing.

Flow manufacturing. It is concerned with the production of high-volume standard products. If the units are discrete (e.g., cars), the process is usually called repetitive manufacturing and if the goods are made in a continuous flow (e.g., gasoline), continuous manufacturing. There are 4 major characteristics to flow manufacturing:

- Routings are fixed and work centers are arranged according to the routing.
- The time taken to perform work at one work center is almost the same as any other work center in the line;
- Work centers are dedicated to producing a limited range of similar products. Machinery and tooling are especially designed to make the specific products;
- Material flows from one workstation to another using some form of mechanical transfer. There is little buildup in work-in-process inventory and throughput times are low;
- Capacity is fixed by the line.

PAC concentrates on planning the flow of work and making sure that the right material is fed to the line as stated in the planned-schedule. Since work flows from one workstation to another automatically, implementation and control are relatively simple.

Intermittent manufacturing It is characterized by many variations in product design, process requirements and order quantities.
If a small business is going to manufacturer products that are of a similar type, they can adopt an intermittent manufacturing method. Businesses that manufacturer items that are similar in nature, but have variations, are suitable for intermittent manufacturing. For example a company that only manufacturers tires for bicycles will sell tires that are of different sizes to fit a variety of bicycle wheels. Businesses will manufacture batches of the same product depending on demand and then will manufacture a batch of the same or another product. This type of manufacturing is good for products, which are based on fluctuating demand. 

This kind of manufacturing ischaracterized by the following:

- Flow of work through the shop is varied and depends on the design of a particular product. As orders are processed, they will take more time at one workstation than an another. The work flow is not balanced;
- Machinery and workers must be flexible enough to do the variety of work. Machinery and work centers are usually grouped according to the function they perform (e.g., all lathes in one department);
- Throughput times are generally long. Scheduling work to arrive just when needed is difficult, the time, taken by an order at each work center and
work queues, varies causing long delays in processing. Work-in-process Inventory is often large;
- The capacity required depends on the particular mix of products being built and is difficult to predict.

PAC in intermittent manufacturing is complex. Planning and control are typically exercised using shop orders for each batch being produced.

Project manufacturing. It usually involves the creation of one or a small number of units (e.g., large shipbuilding). Because the design of a product is often carried out or modified as the project develops, there is close coordination between manufacturing, marketing, purchasing and engineering.

PAC Definitions

Order Processing
APICS defines order processing as the activity required to administratively process a customers’ order and make it ready for shipment or production.

Order Promising
APICS defines order promising as the process of making a delivery commitment, I.e. answering the question, when can you ship? For make-to-order products, this usually involves a check of uncommitted material and availability of capacity, often as represented by the master schedule available to promise.

Pull System
APICS defines Pull System as a system that In production, produces items only as demanded for use or to replace those taken for use
In material control, withdraws inventory as demanded by using operation. Material is not issued until a signal comes from the user In distribution, replenishes field warehouse inventories where replenishment decisions are made at the field warehouse itself, not at a central warehouse or plant.

Push System
APICS defines Push system as a system that In production, produces items at times required by a given schedule planned in advance
In material control, issues the material according to a given schedule or issues material to a job order at its start time. In distribution, replenishes field warehouse inventories where replenishment decision making is centralized, usually at the manufacturing site or central supply facility.

Planning files
PAC must have a data or information system from which to work. The files contained in the databases are of 2 types: planning and control.
4 planning files are needed: item master file, product structure file, routing file and work center master file.

Item master file
There is one record in it for each part number. The file contains all of the pertinent data related to the part. For PAC, this includes the
- Part number, a unique number assigned to a component;
- Part description;
- Manufacturing lead time;
- Quantity on hand;
- Quantity available;
- Allocated quantity;
- On-order quantities, the balance due on all outstanding orders;
- Lot-size quantity.

Product structure file (bill of material file) It contains a list of single-level components and quantities needed to assemble a parent.

Routing file It contains a record for each part manufactured. For each product, this file contains a step-by-step set of instructions describing how the product is made. It gives details of the following:
- The operations required to make the product and the sequence in which those operation are performed;
- A brief description of each operation;
- Equipment, tools and accessories needed for each operation;
- Setup times;
- Run times;
- Lead times for each operation.

Work center master file It collects all of the relevant data on a work center.For each work center, it gives details on the following:
- Work center number,
- Capacity,
- Number of shifts worked per week,
- Number of machine hours per shift,
- Number of labor hours per shift
- Queue time,
- Alternate work centers, work centers that may be used as alternatives.

Control files
Control in intermittent manufacturing is exercised through shop orders and control files that contain data on these orders. There are generally 2 kinds of files: the shop order master file and the shop order detailed file.

Shop order master file
Each active manufacturing order has a record in it.The purpose is to provide summarized data on each shop order such as the following:
- Shop order number, a unique number identifying the shop order;
- Order quantity;
- Quantity completed;
- Quantity scrapped;
- Quantity of material issued to the order;
- Due date, the date the order is expected to be finished;
- Priority, a value used to rank the order in relation to others;
- Balance due, the quantity not yet completed;
- Cost information.

Shop order detail file
Each shop order has a detail file that contains a record for each operation needed to make the item. Each record contains the following:
- Operation number;
- Setup hours, planned and actual;
- Run hours, planned and actual;
- Quantity reported complete at that operation;
- Quantity reported scrapped at that operation;
- Due date or lead time remaining.

Manufacturing lead time (MLT)
MLT is the time normally required to produce an item in a typical lot quantity.
Typically, MLT consists of 5 elements:

- Queue time, amount of time the job is waiting before operation begins;
- Setup time, time required to prepare the work center for operation;
- Run time, time needed to run the order through the operation;
- Wait time, amount of time the job is before being moved to the next work center;
- Move time, transit time between work centers.

The total MLT
will be the sum of order preparation and release plus the MLTs for each operation. Setup time and run time are straightforward and determining them is the responsibility of the industrial engineering department. Queue, wait and moves times are under the control of manufacturing and PAC.
The largest of the 5 elements is queue time. In an intermittent manufacturing operation, it accounts for 85%-95% of the total lead time. If the number of orders waiting to be worked on (load) is reduced, so is the queue time, the lead time and work-in-process. Increasing capacity also reduces queue. PAC must manage both the input of orders to the production process and the available capacity to control queue
and work-in-process.

Cycle time is the length of time from when material enters a production facility until it exits. A synonym is throughput time.

Planning for Execution

PAC is responsible for planning and preparing order’ s release to the shop floor. The order should be reviewed to be sure that the necessary tooling, material and capacity are available. Tooling is not generally considered in MRP program, so at this
stage, material availability must be checked. Checking capacity availability is a twostep process. First, the order must be scheduled to see when the capacity is needed, and second, the load on work centers must be checked in that period.

The objectives of scheduling is to meet delivery dates and to make the best use of manufacturing resources. It involves establishing start and finish dates for each operation required to complete an item. To develop a reliable schedule, the planner must have information on routing, required and available capacity, competing jobs and manufacturing lead times at each work center involved.

Job shop scheduling (or Job-shop problem) is an optimization problem in computer science in which ideal jobs are assigned to resources at particular times. The most basic version is as follows:
We are given n jobs J1, J2, ..., Jn of varying sizes, which need to be scheduled on m identical machines, while trying to minimize the makespan. The makespan is the total length of the schedule (that is, when all the jobs have finished processing).

There are many techniques to schedule shop orders through a plant, but all of them require an understanding of forward and backward scheduling as well as finite and infinite loading.

Forward Scheduling : APICS Defines forward scheduling as a scheduling technique where the scheduler proceeds from a known start date and computes the completion date for an order, usually proceeding from the first operation to the last. Dates generated by
this technique are generally the earliest start dates for the operations.

Forward Scheduling is used to develop promise dates for customers
May focus on critical operations, identifying when they would next be available, then scheduling through subsequent operations
Works poorly for complex product structures
      Assembly component lead times differ, but must be scheduled to be available concurrently to start assembly.
      Many paths through the structure need to be calculated, adjusted to the timing of the longest path.
Can be used to supplement backward scheduling to solve problems, respond to customer needs
      A job is behind schedule – will it be possible to catch up? Will the order have to be rescheduled?
      A major customer needs a spare part as soon as possible – how quickly can we produce it?

Backward scheduling. The last operation on the routing is scheduled first and is scheduled for completion at the due date. Previous operations are scheduled back from the last operation. Work-in-process inventory is reduced, but because there is little slack time in the system, customer service may suffer. Backward scheduling is used to determine when an order must be started.

In backward scheduling MRP establishes the completion dates. Independent demand quantities and timings are based on the MPS.
Order completion dates and release dates are determined for each part in the product structure, using the planned lead times for each part number MRP plans order due dates and release dates and keeps them up-to-date by adjusting for changes in schedules, lead times, product structure.
Typically work centers have several jobs waiting in line to be done. Which should go first? Order due dates alone do not provide an answer. Priority should be determined based on working a backward schedule and comparing the release dates against customer required schedule.

Infinite loading. It does not consider the existence of other shop orders competing for capacity at these work centers. It assumes infinite capacity will be available. Notice the over and under load.

Finite loading assumes there is a defined limit to available capacity at any workstation. If there is not enough capacity available at a workstation because of other shop orders, the order has to be scheduled in a different period time. The load is smoothed so there is no overload condition.

Reducing MLT
Operation overlapping
In operation overlapping, the next operation is allowed to begin before the entire lot is completed on the previous operation. This reduces the total manufacturing lead times. An order is divided into at least 2 lots. When the first lot is completed on operation A, it is transferred to operation B.

In figure, it is assumed operation B cannot be set up until the first lot is received, but this is not always the case. If the lots are sized properly, there will be no idle time at operation B. The manufacturing lead time is reduced by the overlap time
and the elimination of queue time.

Operation overlapping is a method of expediting an order, but there are some cost involved. First, move costs are increased, especially if the overlapped operations are not close together. Second, it may increase the queue and lead time for other orders. Third, it does not increase capacity but potentially reduces it if the second operation is idle waiting for parts from the first operation.
The problem is deciding the size of the sub-lot. If the run time per piece on operation B is shorter than on A, the first batch must be large enough to avoid idle time on operation B.

Operation Splitting

When a number of components are to be processed by a machine operation, the leadtime required to do so may be halved if 50% of the components are able to be processed by a second alternative machine. (Naturally, the operation splitting between the two machines requires that a second operator should be available, and a second set of tools.) It is noted that since there are now two works orders, each for half the original amount, planned quantities in the planning system must be corrected and an additional set of shop floor paperwork generated. It is also noted that a second set-up is required, casting doubt over the economics of splitting an operation between three machines.

Operation splitting is practical when:
- setup time is low compared to run time,
- a suitable work center is idle,
- it is possible for an operator to run more than one machine at a time.

The last condition often exists when a machine cycles through its operation automatically, leaving the operator time to set up a other machine. The time to unload and load must be shorter than the run time per piece.

Load Leveling

Load report tells PAC what the load is on the work center.

 There is a capacity shortage in week 20 of 30 hours. This means there was no point in releasing all of planned orders that weeks.

Perhaps some could be released in week 18 or 19 and perhaps some overtime could be worked to help reduce the capacity crunch.

Scheduling Bottlenecks

APICS defines bottleneck as 'a facility, function, department, or resource whose capacityis equal to or less than thedemand put upon it'.

In intermittent manufacturing, it is almost impossible to balance the available capacity of the various workstations with the demand for their capacity. As a result, some workstations are overloaded and others are under-loaded. The overloaded workstations are called bottlenecks.

Throughput is the total volume of production passing through a facility. Bottlenecks control the throughput of all products processed by them. If work centers feeding bottlenecks produce more then the bottleneck can process, excess work-inprocess inventory is built up. Work centers fed by bottlenecks have their throughput controlled by bottleneck and their schedules should be determined by that of the

In the 1970’s Eli Goldratt introduced optimized production technology (OPT). OPT focused on bottlenecks for scheduling & capacity planning.Since bottlenecks control the throughput of a facility, some important principles should be noted:

- Balance Flow, not Capacity
Line balancing, which is an example of tradition system, attempts to balance the capacity of each work-station. Work-stations are so designed that their capacity is nearly same and, hence, there is a high utilization factor. OPT, using TOC on the other hand, focuses on balancing the flow within the plant (rather than resources as in line-balancing). This will ensure the identification of bottleneck (on constraint). Once the bottleneck is handled for improvement, the throughput of the system increases.

- Utilization of a non-bottleneck resource is not determined by its potential, but by another constraint of the system;

- Using a non-bottleneck 100% of the time does not produce 100% utilization;

- The capacity of the system depends on the capacity of the bottleneck;

- Time saved at a non-bottleneck saves the system nothing;

- Capacity and priority must be consider together. Suppose 2 styles of product are made on a bottleneck. During setup, nothing is produce which reduces the capacity of the system. Ideally, the company would run one style of product for 6 months then switch over to the second style. However, customers wanting the 2nd style might not be willing to wait 6 months. A compromise is needed whereby runs are as long as possible but priority (demand) is satisfied;

- Loads can and should be split. Rather than waiting until the batch are produced before moving it to the next work center, the manufacturer can move a sub-lot. The process batch size and the transfer batch size are different. Thus, delivery to the next work center is matched to usage and work-in-process inventory is reduced;

- Focus should be on balancing the flow through the shop. The key is throughput that ends up in sales

-Utilization and activation of a resource are not synonymous or the same thing.

Traditionally, activation of resource and utilization of resource are treated as same thing. Goldratt, in his TOC, treats these two issues separately. First, let us understand: what is the difference between utilization and activation?

Activation: “What we should do” is activation. It is the indication of doing the required work. Activation is directed towards effectiveness. It is system’s measure of performance or holistic approach. A non-bottleneck machine may be active (producing 100%), yet not doing anything useful beyond the capacity of bottleneck.

Utilization: “What we can do” is utilization. It also includes performing work not needed at a particular time. Utilization is directed towards efficiency. It is a reductionist emasure of performance or mechanistic approach.

Example : 
Let us assume that a non-bottleneck has a capacity of 100 parts per day while a subsequent bottleneck has capacity of 60 parts per day as shown in fig. When both resources work at 100% efficiency, the inventory building-up is (100-60) or 40 parts per day. However, at a global or holistic level, the system (combined) is operating at only 60% efficiency level as throughput is 60 parts per day. Thus, the utilization of non-bottleneck (i.e. 100%) is not same as its activation (i.e. 60%) as it is effective for only 60% of its capacity.

Managing bottlenecks
Since bottlenecks are so important to the throughput of a system, scheduling and controlling them is extremely important. The following
must be done:
- Establish a time buffer before each bottleneck. A time buffer is an inventory (queue) place before each bottleneck. The time buffer should be only as long as the time of any expected delay caused by feeding workstations. In this way, the time buffer ensures that the bottleneck will not be shut down for lack of work and this queue will be held at a predetermined minimum quantity;
- Control the rate of material feeding the bottleneck. A bottleneck must be fed at a rate equal to its capacity so the time buffer remains constant. The first operation in the sequence of operations is called a gate operation;
- Do everything to provide the needed bottleneck capacity. Anything that increases the capacity of the bottleneck, increases the capacity of the system;
- Adjust loads. This is similar to previous item but puts emphasis on reducing load on a bottleneck by using such things as using alternate work centers and subcontracting. These may be more costly than using the bottleneck, but utilization of non-bottlenecks and throughput of the total system is increased, resulting in more company sales and increased profits;
- Change the schedule. Do this as a final resort, but it is better to be honest about delivery promises.
Once the bottleneck is scheduled according to its available capacity and the market demand it must satisfy, the non-bottleneck resources can be scheduled. Any disturbances in the feeding operations are absorbed by the time buffer and throughput is not affected.

Improve the process
Once a constraint has been identified, there is a five-step process that is recommended to help improve the performance of the operation:
- Identify the constraints. This implies the need to examine the entire process to determine which process limits the throughput. The concept does not limit this process examination to merely the operational processes;
- Exploit the constraint. Find methods to maximize the utilization of the constraint toward productive throughput;
- Subordinate everything to the constraint. Effective utilization of the constraint is the most important issue;
- Elevate the constraint. This means to find ways to increase the available hours of constraint, including more of it;
- Once the constraint is a constraint no longer, find the new one and repeat the steps.

Even the scheduling system developed for the TOC has its own specific approach. It is often described as Drum-Buffer-Rope
- Drum. The drum of the system refers to the drumbeat or pace of production. It represent the master schedule for the operation, which is focused around the pace of throughput as defined by the constraint;
- Buffer. Since it is so important that the constraint never be starved for needed inventory, a time buffer is often established in front of the constraint;
- Rope. The analogy is that the rope pulls production to the constraint for necessary processing. While this may imply a Kanban-type pull system, it can be done by a well-coordinated release of material into the system at the right time.