1 CAPACITY PLANNING (Chapter 6) How capacity is measured. p. 221 Capacity utilization = Avg output/Max capacity 221 Capacity planning over ST/MT/LT Factors affecting capacity –Demand and demand management –Constraints: Productivity, Quality, Location, Layout, Scheduling –External factors

2 CAPACITY PLANNING Capacity planning options - short term Capacity planning options - medium term Capacity expansion for long term needs –Timing decisions 223 –Scale decisions Economies and diseconomies of scale 221, 222 Techniques/Tools –Waiting line models; decision trees; financial analysis, simulation 229-

3 Facility Location (Notes) Nature and Importance of location decisions Factors affecting location decisions. –Locating facilities globally Methods of evaluating location alternatives –Factor rating method Location of services

4 Process/Facilities Layout chapter 7 Nature and importance of the problem Types of layouts: flexible flow; line flow Flexible flow layouts –Criteria: Information needed; evaluating alternatives; computer programs for evaluation Line flow layouts = assembly lines 274 –Cycle time; output; no. of workers; idle time; efficiency Behavioral factors Hybrid layouts; Group technology 305- chapter 8

5 SUPPLY CHAIN MANAGEMENT Chapters 9, 10 What is a supply chain? What is SCM? 325 Supply chain dynamics 356 –External causes 357 –Internal causes 358 Customer interface 372 – marketing, order placement, order fulfillment Inventory and distribution – later chapters Supplier interface 366- The outsourcing v. vertical integration decision 401- Supplier management –Selection 361 –Orientation/mutual agreement on goals/development –Evaluation and rating –Incentives –Participation

6 SUPPLY CHAIN MANAGEMENT Integration of the supply chain –What is integration ? Advantages. –Efficient v responsive supply chains 342 –Technology of integration RFID 367 EDI 366

7 Inventory Management Chapter 12 Inventory management is an integral part of SCM Functions of inventory Inventory classification – ABC classification 416 –Uses of ABC classification: Inventory review 423-; cycle counting 417 The simple (EOQ) inventory model for uniform demand 417- –Reorder point model when there is a lead time –Other variations: simultaneous production; quantity discounts; backorders Inventory model for non uniform (probabilistic) demand 424- ; Safety stock

8 Operations planning and Scheduling Chapter 14 Aggregation 504,505; aggregate plan = MT operations plan A production, staffing and inventory plan 504 Aggregate planning strategies 511 and alternative actions/options 506- Costs 512 –Chase, level and mixed strategies; adv. and disadv. Methods for selecting a plan: spreadsheets 514

9 Resource Planning: MRP and ERP Chapter 15 Dependent demand 544 The master production schedule 547- MRP Process 545- –Bill of materials 545 –Inventory records 550 –Lead times 553 –Lot sizing 554 Integrating Capacity planning. MRP II 559 ERP systems 542

10 JIT and LEAN PRODUCTION SYSTEMS Chapter 8 JIT philosophy 296 –Waste reduction. Variability reduction Pull v. Push production systems 300 Partnerships with suppliers 298 Other JIT characteristics 298- –Quality 300; small lot sizes 299; uniform work station loading 301; standardization 302; flexible workforce 302; preventive maintenance 304; good layout; good scheduling

11 SHORT TERM SCHEDULING (Notes) Examples Scheduling criteria –completion/flow time, waiting time, makespan, utilization Sequencing jobs in work centers –Priority rules: FCFS, SPT, EDD, LPT, Slack –Critical ratio Scheduling with one machine/resource Scheduling with two machines Multiple machine situations d