Integral Logistics Management — Operations Management and Supply Chain Management Within and Across Companies

15.7 Scenarios and Exercises

Intended learning outcomes: Calculate examples for load-oriented order release (Loor) and for finite forward scheduling. Assess characteristics of capacity-oriented materials management (Corma) and of order Picking.


15.7.1 Load-Oriented Order Release (Loor)

The first table in Figure 15.7.1.1 shows five orders with their sequence of operations. The data for each operation include the work center, the standard load (e.g., setup plus run time), and a blank column for entering the converted load.

The second table in Figure 15.7.1.1 shows parameters for load-oriented order release, as introduced in Section 15.1.2, as well as their values given for this exercise. The third table holds data for each work center, namely, the weekly capacity, the existing (pre-)load before loading the five orders, a blank column for entering the capacity upgraded by the loading percentage, and blank columns for the summarized load after releasing orders 1 to 5 (that is in the sequence given by the Loor algorithm).

Fig. 15.7.1.1       Given data for a Loor problem.

a.    Load the five orders according to the Loor algorithm.

b.    What would have happened if for operation 3 of order 2 the standard load had been 200 units of time instead of 120?

c.    Discuss whether in your solution the treatment of order 3 was efficient.

d.    What would have happened if order 3 had been loaded before order 2?

Solutions:

a.    The time filter eliminates order 5. This order is declared as not urgent. For the other orders, the conversion factor is applied to their operations. In the third table, the loading percentage multiplies the weekly capacity. Then, order 1 is loaded, followed by order 2. Order 2 is accepted, but it overloads work center B (220 units of time against 200 units resulting from the loading percentage). Hence, order 3 cannot be loaded, because its last operation is at work center B. However, order 4 can be loaded, since it has no operation at work center B.

b.    Order 2 would have overloaded work center A. Hence, order 4 would not have been loaded.

c.    The converted load of order 3 on work center B had only 5 units of time. This would have changed the total load only very slightly. As there was no overloading of other work centers by orders 1, 2, and 4, it might have been wise to release order 3 as well.

d.    Order 3 would have overloaded work center A (405 units of time against 400 units resulting from the loading percentage). Therefore, the algorithm would formally reject both orders 2 and 4. This would result in a low utilization of the other work centers B, C, and D.


15.7.2 Capacity-Oriented Materials Management (Corma)

Applying the capacity-oriented materials management (Corma) principle has which of the following results?

I     Evenly distributed extension of the manufacturing lead time for all the orders

II    Minimum amount of work in process

III   Maximum utilization of the generally well-utilized work centers

a.    II only

b.    III only

c.    I and II only

d.    II and III only

Solution:

The answer is (b), or “III only.” In fact, the early release of an order implies an extension of its lead time, because it will wait as soon as there are (unplanned) customer orders. The latter will be performed with minimal lead time. Thus, I is not true. II is not true, either, because of the very presence of early released orders. However, III is true: A bottleneck capacity is loaded with nonurgent (i.e., early released) orders as soon as there is available capacity.


15.7.3 Finite Forward Scheduling

Your company owns one lathe (M1), one milling machine (M2), and one drilling machine (M3). A working day lasts eight hours. As Figure 15.7.3.1 shows, eight products (P1, P2, P3,  . . . , P8) are manufactured on these machines. Each product loads these machines in a different sequence. For simplicity, assume that there is no inter­operation time.

Fig. 15.7.3.1       Eight products manufactured on three machines.

Perform finite forward scheduling for the next three days. The normal working time of 8 hours per day has to be respected, as do the sequence of the operations for each order given by Figure 15.7.3.1 and the following three priority rules:

1.    No idle time on the machine

2.    Operation with the shortest processing time

3.    Longest remaining lead time for the order

The Gantt-type chart planning board in Figure 15.7.3.2 will help you to perform the task. Note the first orders on each machine. The order for product P1 has been chosen for machine M1 because of the third priority rule.

Fig. 15.7.3.2       Gantt-type chart for finite forward scheduling.

Discuss whether other priority rules would result in a better solution with regard to work in process.

Solution:

The total load is 21 hours on machine 1, 20 hours on machine 2, and 24 hours on machine 3. Thus, machine 3 is fully loaded, and priority rule 1 makes full sense. There are solutions for this problem that schedule the other two machines without idle time, respecting the sequence of operations for all eight orders. One of these solutions can be found by simply following the priority rules.

Replacing the second and the third priority rule by the rule shortest remaining lead time would result in considerably less work in process. However, strict application of this rule not only results in idle time on machine 3, but also creates delays for order 3 and order 6: They cannot be finished at the end of the third day. Both effects cannot be tolerated because these orders are started too late. As a consequence, there must be some rule giving them priority at some time, thereby augmenting work in order.


15.7.4 Order Picking

As depicted in Figure 15.4.1.1, discrete order picking, batch picking, sequential picking, and parallel, or zone, picking result in four common picking strategies. Point out the main characteristics of the following picking strategies. List the advantages and disadvantages of each. Derive possible fields of application:

a.    Sequential, discrete order picking

b.    Zone, or parallel, batch picking

Solution:
a.    Sequential, discrete order picking

       Characteristics:
       ·     Most common method of picking
       ·     Pickers fill all open positions of an order before work on picking the next order can begin
       ·     Based on a picking list that contains an optimal routing

       Advantages:
       ·     Maintains order integrity
       ·     Minimum of organizational efforts
       ·     Simple to execute and easy to control
       ·     Direct fill responsibility

       Disadvantages:
       ·     Required time for picking
       ·     Decreasing efficiency with growing order size
       ·     Large number of pickers needed

       Possible fields of application:
       ·     Small warehouses, low inventory turnover, low performance, small orders

b.    Zone, or parallel, batch picking

       Characteristics:
       ·     Several orders are aggregated by product (as batch), the entire batch withdrawn, and the discrete orders reassembled in a consolidation area
       ·     Batches are picked parallel in different zones of the warehouse and then merged in the consolidation area

       Advantages:
       ·     Reduced travel and fill times
       ·     Low picking time due to parallel zones
       ·     Improved supervision of order completion in consolidation area
       ·     Increased picking accuracy and productivity due to zones
       ·     Picker familiarity with zone products

       Disadvantages:
       ·     Double handling and sorting in the consolidation area
       ·     Space and labor for consolidation area
       ·     Difficult tracing and control of orders
       ·     Requires high-volume picking 

       Possible fields of application:
       ·     Large orders, high number of orders, large warehouses, products with different storage requirements (e.g., flammable goods, refrigerated goods)



Course sections and their intended learning outcomes

  • Course 15 – Order Release and Control

    Intended learning outcomes: Differentiate various techniques for order release. Explain in detail shop floor control. Present methods and techniques used for order monitoring and shop floor data collection. Describe distribution control.

  • 15.1 Order Release

    Intended learning outcomes: Describe order proposals for production and procurement as well as order release. Explain load-oriented order release (Loor) and capacity-oriented materials management (Corma).

  • 15.2 Shop Floor Control

    Intended learning outcomes: Describe the issuance of accompanying documents for production. Explain operations scheduling, dispatching, and finite forward scheduling. Present sequencing methods.

  • 15.3 Order Monitoring and Shop Floor Data Collection

    Intended learning outcomes: Describe recording issues of goods from stock and completed operations. Produce an overview on progress checking, quality control, report of order termination, and automatic and rough-cut data collection.

  • 15.4 Distribution Control

    Intended learning outcomes: Explain order picking, packaging, load building, and transportation to receiver.

  • 15.5 Summary

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  • 15.6 Keywords

    .

  • 15.7 Scenarios and Exercises

    Intended learning outcomes: Calculate examples for load-oriented order release (Loor) and for finite forward scheduling. Assess characteristics of capacity-oriented materials management (Corma) and of order Picking.


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