Assignment

Capacity
The recorded solution to the first problem is
available at
[Link]
Key Problem 2
MamossaAssaf Inc. fabricates garage doors. Roofs are
punched in a roof punching press (15 minutes per roof)
and then formed in a roof forming press (8 minutes per
roof). Bases are punched in a base punching press (3
minutes per base) and then formed in a base forming
press (10 minutes per base), and the formed base is
welded in a base welding machine (12 minutes per base).
The base sub-assembly and the roof then go to final
assembly where they are welded together (10 minutes
per garage) on an assembly welding machine to complete
the garage. Assume one operator at each station.
Roof RPunch
- R-Form
15 8
Assembly Door
Base B-Form Weld 10
B-Punch
3 10 12
Capacity- Basics Ardavan Asef-Vaziri 2
Key Problem 2: Flow Time
Roof R-Punch R-Form
15 8
Assembly Door
Base B-Form Weld 10
B-Punch
3 10 12
(a) What is the Theoretical Flow Time? (The minimum time
required to produce a garage from start to finish.)

Flow Time  Theoretical Flow Time


Roof Path: 15+8 = 23 Max = 25 + 10
Base Path: 3+10+12 = 35
Critical Path = Max(33,35) = 35
= 25 Theoretical Flow Time = 35
Capacity- Basics Ardavan Asef-Vaziri 3
Key Problem 2: Capacity
(b) What is the capacity of the system in terms of garages
per
Roofhour?R-Punch R-Form
15 8
Assembly Door
Base B-Form Weld 10
B-Punch
3 10 12
R-Punch:1/15 per min. or 4 Process Capacity is 4
per hr. per hour
R-Form:1/8 per min. or 7.5 per (c) If you want to increase
the process capacity, what
hr. is the activity you would
B-Punch:1/3 per min. or 20 per put additional resource?

hr. R-Punch
B-Form:1/10
Capacity- Basics per min. or 6 per hr. Asef-Vaziri
Ardavan 4
Key Problem 2: Capacity
(d) Compute utilization of all the resources at the full
process capacity. In other words, assume that the
throughput is equal to process capacity. Throughput = 4

In reality,
R-Punch Utilization = 4/4 = 100%. utilization of all the
R-Form Utilization = 4/7.5 = 53.33%. resources will be
B-Punch Utilization = 4/20 = 20%. less than what we
B-Form Utilization = 4/ 6 = 66.67%. have computed.
Welding Utilization = 4/5 = 80%. This process can
Assembly Utilization = 4/6 = 66.67% never produce 4
No Process can work at 100% capacity.
flow units per hour
Impossible.
Capacity- Basics Ardavan Asef-Vaziri
continually.5
 Key Problem 2: Bottleneck Shift
(e) Suppose we double the capacity of the bottleneck by
adding the same capital and human resources. What is the
new capacity of the system.
RPunch
-
Roof R-Form
RPunch
-
8
15 Assembly Door
Base B-Form Weld 10
B-Punch
3 10 12
R-Punch: 2/15 per min. or 8 per hr.
R-Form:1/8 per min. or 7.5 per hr.
B-Punch:1/3 per min. or 20 per hr.
B-Form:1/10 per min. or 6 per hr.
Welding: 1/12 per min. or 5 per Process Capacity is 5
hr. per hour
Assembly: 1/10 per min. or 6 per hr.
Capacity- Basics Ardavan Asef-Vaziri 6
Key Problem 2: Diminishing Marginal Return
(f) We doubled the capacity of the bottleneck but the
capacity of the system increased by only 25%. This
situation is an example of what managerial experiment?
 Bottleneck shifts from R-Punch to Welding
 Diminishing Marginal Return

g) Now suppose we return back to the original situation

where we have a single machine and a single operator
at each operation. However, also suppose that we pool
R-Punch and B-Punch machines and we cross-train their
operations and form a new resource pool named Punch
where both R-Punch and B-Punch operations can be
done in this resource pool. What is the new capacity of
the system?
Capacity- Basics Ardavan Asef-Vaziri 7
Key Problem 2: Pooling and Cross Training
R-Punch R-Form
R-Punch
Punch R-
Form Assembly
15 8
Assembl
B-Form Weld y
10
B-Punch
B-Punch
B-Punch
Punch B- Wel
Form
10 d
12
3

You may imagine activities R-Punch Activity and B-Punch

Activity on the two Punch Resources in the Punch
Resources Pool as follows
Punch
Resource
Pool
Capacity- Basics Ardavan Asef-Vaziri 8
 Key Problem 2: Pooling and Cross Training
R-Form
R-Punch&B-Punch R-
Form Assembly
Punch 8
Assembl
Punch B-Form Weld y
10
15,3 B- Wel
Form
10 d
12
Punch: 2/18 per min. or 6.67 per hr.
R-Form:1/8 per min. or 7.5 per hr.
B-Form:1/10 per min. or 6 per hr.
Welding: 1/12 per min. or 5 per Process
hr. Capacity is 5
per hour
Assembly: 1/10 per min. or 6 per hr.

Capacity- Basics Ardavan Asef-Vaziri 9

Key Problem 2: Productivity Improvement -
Method, Training, Technology, Management
h) This situation is an example of what managerial
1) Cross training and pooling can increase the capacity
experiment?
2) Usually cost of cross training and pooling is lower
than the cost of adding the second resource unit.
k) Compute utilization of all the resources if the throughput
is equal to 4 units per hour. What is the utilization of the
bottleneck.
Resource Tp c Rp/ min Rp/ Hr R U
Punch 18 2 0.111 6.667 4 0.6
R-Form 8 1 0.125 7.5 4 0.53
B-Form 10 1 0.1 6 4 0.67
Welding 12 1 0.083 5 4 0.80
A ssembly 10 1 0.1 6 4 0.67
Capacity- Basics Ardavan Asef-Vaziri 10
Key Problem 2: Productivity Improvement -
Method, Training, Technology, Management
i) Now suppose by investing in improved jigs and fixtures
(technology), and also by implementing a better method
of doing the job, and also training, we can reduce the
welding time from 12 minutes to 10 minutes. What is the
new capacity of the system ?

R-Form Process Capacity is 6

R-Punch&B-Punch R- per hour
Form Assembly
Punch 8
Assembl
Punch B-Form Weld y
10
15,3 B- Wel
Form
10 d
12
10
Capacity- Basics Ardavan Asef-Vaziri 11
 Key Problem 2: More Than One Bottleneck
R-Form
R-Punch&B-Punch R-
Form Assembly
Punch 8
Assembl
Punch B-Form Weld y
10
15,3 B- Wel
Form
10 d
10
j) Why it is impossible to work at 100% of capacity?
There are 3 bottlenecks. This is a risky situation. Any of the
bottlenecks could cause the throughput of the system to fall
below 6 per hour.
The more bottlenecks in the system, the higher the probability
of not meeting the capacity.
Suppose punch fail to provide input to B-Form for 1 hour, or B-
Form fails to provide Weld, or Weld fails to provide Assembly, or
Assembly
Capacity- Basics is down- That hour of capacity
Ardavan perishes. Input may 12
Asef-Vaziri
Key Problem 2: Critical Chain
R-Form
R-Punch&B-Punch R-
Punch Form
8 Assembly
Assembl
Punch B-Form Weld y
10
15,3 B- Wel
Form
10 d
10
Not only the system has
three bottlenecks, but one Path Assembly
bottleneck feeds the next 1
23 Assembl
one. Furthermore, both y
paths to the last 10
Path
bottleneck are critical? 2
They can both increase the 23
flow time.
Capacity- Basics Ardavan Asef-Vaziri 13
Lessons Learned
 A process cannot have a throughput greater than or
even equal to its capacity.
 Capacity is perishable- it is lost if input is not ready. The
more the bottleneck recourses, the lower the utilization.
 Flow Time increases with utilization and does so sharply
as utilization approaches 100%.
 By doubling the bottleneck resource, the capacity
usually does not double. This could be interpreted as
diminishing marginal return situation.
 When we relax a Bottleneck Resource, the Bottleneck
shifts to another resource
 One other way to increase capacity is cross training (for
Human Resources ) and pooling (for Capital Resources).

Capacity- Basics Ardavan Asef-Vaziri 14

Lessons Learned
 Usually cost of cross training and pooling is lower than
the cost of adding the second resource unit.
 One other way to increase capacity is to reduce unit
load. This is done by (a) better methods, (b) training, (c)
replacing human resources by capital resources (more
advanced technology), and (d) better management.
 Convergence points are important in managing the flow
time. The more convergence points there are, the
higher the probability of longer flow time.
 Over the long term, in a stable process, RT=I
 At a single station with no limit on the capacity of the
waiting line, Flow Time = V×U×T, where U is a measure
of Utilization, V is a measure of Variability, and T is a
measure of the Activity Time (or unit-load).

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