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# Theory of constraint

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### Transcript

• 1. The Theory of Constraints Now that we know the Goal, how do we use it to improve our system? 8/27/04 Paul A. Jensen Operations Research Models and Methods Copyright 2004 - All rights reserved
• 2. The Theory of Constraints
• Step 1: Identify the system's constraint(s).
• Step 2: Decide how to exploit the system's constraint(s).
• Step 3: Subordinate everything else to the decisions of Step 2.
• Step 4: Elevate the system's constraint(s).
• Step 5: If a constraint is broken in Step 4, go back to Step 1.
• 3. Step 1: Identify the system’s constraint(s).
• What is the Goal?
• What is Throughput?
• What is Inventory?
• What is Operating Expense?
• 4. Step 2: Decide how to exploit the system’s constraint(s).
• What is the constraint?
• How do we get as much throughput as possible?
• 5. Step 3: Subordinate everything else to the decisions of Step 2
• Throughput?
• Inventory?
• Operating Expense?
• 6. Step 4: Elevate the system’s constraint(s).
• Throughput?
• Inventory?
• Operating Expense?
• 7. Step 5: If a constraint is broken in Step 4, go back to Step 1.
• What might happen if the constraint is elevated?
• 8. Summary: The Theory of Constraints
• Step 1: Identify the system’s constraint(s).
• Step 2: Decide how to exploit the system’s constraint(s).
• Step 3: Subordinate everything else to the decisions of Step 2.
• Step 4: Elevate the system’s constraint(s).
• Step 5: If a constraint is broken in Step 4, go back to Step 1.
• 9. Application in Manufacturing
• 10.
• 11. Step 1: Identify the system’s constraint(s).
• What is the Goal?
• What is Throughput?
• What is Inventory?
• What is Operating Expense?
• 12. To Identify the Resource Constraint
• Compute the load on each production resource assuming market demands.
• Compare the resource loads with the resource capacities.
• Those resources for which the loads exceed the capacities are constraints (bottlenecks).
• If no production resource load exceeds its capacity,
• the market demands are the constraints.
• the constraints are external to the manufacturing system.
• 13. Compute the loads and compare with capacities.
• Production P=100, Production Q=50
• A: Load =2000, Capacity = 2400 Minutes
• B: Load =3000, Capacity = 2400 Minutes
• C: Load =1750, Capacity = 2400 Minutes
• D: Load =1250, Capacity = 2400 Minutes
• What is the constraint?
• 14. Step 2: Decide how to exploit the system’s constraint(s).
• 15. Exploiting the constraint
• Assume a single constraint is identified.
• Rank the products in order of the ratio:
• Throughput dollars per minute of constraint use.
• Select the product mix so that the products with greater ratios are produced in preference to the products with smaller ratios.
• What goal is this method trying to achieve?
• How does this method achieve the goal?
• 16. What and how much to produce?
• P: TP/Unit = 45, B Min/Unit=15
• Q: TP/Unit = 60, B Min/Unit=30
• 17. Calculate Solution
• Produce as much P as possible
• Use the remainder of the constraint resource for Q
• What is the profit for this product mix?
• 18. Step 3: Subordinate everything else to the decisions of Step 2.
• 19. Subordinating Production
• Production P=100, Production Q=30
• A: Load =1800, Capacity = 2400 Minutes
• B: Load =2400, Capacity = 2400 Minutes
• C: Load =1650, Capacity = 2400 Minutes
• D: Load =1150, Capacity = 2400 Minutes
• What determines the load on the non-constraints?
• 20. Step 4: Elevate the system’s constraint(s).
• Where should process improvements be focused?
• What is the benefit of elevating the constraint?
• What is the benefit of elevating a non-constraint?
• 21. Step 5: If a constraint is broken in Step 4, go back to Step 1.
• What might happen if the constraint is elevated?
• What happens if there are no more internal constraints?
• 22. Say we add another machine of type B.
• Production P=100, Production Q=50
• A: Load =2000, Capacity = 2400 Minutes
• B: Load =3000, Capacity = 4800 Minutes
• C: Load =1750, Capacity = 2400 Minutes
• D: Load =1250, Capacity = 2400 Minutes
• How much should we produce?
• What is the new constraint?
• How do we elevate the new constraint?
• 23. Summary: The Theory of Constraints
• Step 1: Identify the system’s constraint(s).
• Step 2: Decide how to exploit the system’s constraint(s).
• Step 3: Subordinate everything else to the decisions of Step 2.
• Step 4: Elevate the system’s constraint(s).
• Step 5: If a constraint is broken in Step 4, go back to Step 1.