Preface xi
Part I Production Control in General 1
1 Production Control – A Logistic Control Function 3
1.1 Logistics 3
1.2 Logistics Planning and Control 6
1.3 Logistic Concepts in Production 7
1.4 Terminology for Production Control 10
1.4.1 Concepts Used in Production Control 10
1.4.2 Complexity, Uncertainty, and Flexibility 12
References 13
2 Horizontal and Vertical Decomposition 15
2.1 Horizontal Decomposition 16
2.2 Vertical Decomposition 22
2.3 Types of Release Triggers 25
2.3.1 Just-in-Time Versus Just-in-Case 25
2.3.2 Push Versus Pull in Logistics 28
2.4 An Example of Decomposition 30
References 32
3 Planning and Control in Production Units 33
3.1 Production Control in General 33
3.2 Basic Forms of Production 35
3.2.1 Process-Wise Production 35
3.2.2 Mass Assembly/Flow Production 36
3.2.3 (Repetitive) Small Series Production (Also Called Job-Shop) 36
3.2.4 (Repetitive) Project-Wise Production 37
3.2.5 Throughput Time Production Units 37
References 39
4 Framework for Logistic Planning and Control in Production Systems 41
4.1 General Framework 41
4.2 Position of this Book 45
References 46
Part II Planning and Control of Decoupling Points 47
5 Decoupling Point Control 49
5.1 Decoupling Point Control – An Introduction 49
5.2 Performance Measures for Decoupling Point Control 53
5.3 Demand and Forecasting 58
5.3.1 Demand Pattern 59
5.3.2 Forecasting Methods 60
5.3.2.1 Time Series-Related Forecasting for Stationary Demand 63
5.3.2.2 Time Series-Related Forecasting for Demand with a Trend 67
5.4 Order Size 71
5.4.1 Optimal Batch Size in Case of Fixed Order Size 72
5.4.2 Relaxation of Assumptions 75
5.4.2.1 Known or Predicted Demand Variation 75
5.4.2.2 Quantity Discount 78
5.4.2.3 Minimum Order Quantity 79
5.4.2.4 No Variable Order-Related Costs 79
5.4.2.5 Interdependencies of Order Sizes – Not BOM Related 80
5.4.2.6 Interdependencies of Order Sizes – BOM Related 81
5.4.3 Single Period Problem 83
Appendix 5.A The Wagner-Whitin Algorithm 84
Appendix 5.B Example Impact Advanced and Optimal Approach for Determining Batch Sizes 87
Appendix 5.C Newsvendor Problem 87
References 90
6 Reorder Point Decoupling Point Control Systems 93
6.1 General Discussion of Reorder Point Systems 93
6.2 When to Order? 96
6.2.1 Continuous Review 97
6.2.2 Periodic Review 99
6.2.3 The Reorder Level – Continuous Review 100
6.2.4 The Reorder Level – Periodic Review 107
6.3 How Much to Order? 109
6.3.1 Fixed Amount 109
6.3.2 Maximum Level 109
6.3.2.1 (s, S) 109
6.3.2.2 (R, s, S) 110
Appendix 6.A Table of the One-Sided Standard Normal Distribution 110
Appendix 6.B Table Standard Normal Loss Function 112
Appendix 6.C Reorder Level Determination in Case of a General Distribution 113
6.C.1 Discrete Demand 113
6.C.2 Continuous Demand 115
6.C.3 Determining the Reorder Level 116
References 116
7 MRP Decoupling Point Control Systems 117
7.1 General Discussion of MRP Systems 117
7.1.1 Material Requirements Planning (MRP-I) 117
7.1.2 Manufacturing Resources Planning (MRP-II) 119
7.1.2.1 Engine 119
7.1.2.2 Front End 120
7.1.2.3 Back End 121
7.2 When to Order 122
7.3 How Much to Order? 125
7.4 Discussion on MRP-Related Issues 128
7.4.1 Dealing with Uncertainty 128
7.4.2 Bill-of-Materials Versus Bill-of-Distribution 130
Appendix 7.A MRP Formulas 132
7.A.1 Rescheduling Assumption 132
References 133
8 Systems Using Echelon Stock (ESC, LRP) 135
8.1 General Discussion of Systems Using Global Norms 135
8.1.1 Discussion on ROP and MRP 136
8.1.2 Echelon Stock Control Systems 137
8.1.3 Line Requirements Planning 138
8.2 When and How Much to Order? 139
8.2.1 When and How Much to Order in Echelon Stock Systems? 139
8.2.2 When and How Much to Order in Line Requirements Planning Systems? 139
8.3 Discussion on Echelon Stock Systems 142
References 143
9 Choosing an Appropriate DPC System 145
9.1 General Considerations 145
9.2 Advantages/Disadvantages of the Different DPC Systems 146
9.2.1 Bullwhip Effect 147
9.3 Which Decoupling Point Control System to Use? 150
References 157
Part III Production Unit Control 159
10 General Discussion of Production Control Decisions 163
10.1 Priority Control 164
10.2 Capacity Allocation 165
10.3 Work Order Release/Work Order Detail Planning (Scheduling) 166
References 168
11 Production Control for Deterministic, Static Production Situations (Scheduling) 169
11.1 Sequencing Orders Without Delivery Date (Throughput Time Oriented) 170
11.1.1 Work Orders with One Operation and Work Centers with One Machine 171
11.1.1.1 Relation Between Work-in-Process and Throughput Time 171
11.1.1.2 Minimization of the Average Throughput Time 171
11.1.1.3 Minimization of Weighted Average Throughput Time 171
11.1.2 Work Orders with One Operation and Work Centers with Parallel, Identical Machines 172
11.1.2.1 Minimizing the Makespan 172
11.1.2.2 Minimizing the Average Throughput Time 172
11.1.3 Work Orders with Multiple Operations and Work Centers with One Machine 173
11.1.3.1 Minimizing the Makespan for a Flow Shop with Two Operations 174
11.1.3.2 Minimizing the Makespan for a Flow Shop with More Than Two Operations 176
11.2 Sequencing Orders with a Delivery Date (Reliability Oriented) 178
11.2.1 Minimizing the Average Lateness 179
11.2.2 Minimizing the Maximum Tardiness 179
11.2.3 Minimizing the Number of Tardy Orders (N T) 179
11.2.4 Minimizing the Average Tardiness 181
11.3 Relaxing Assumptions 183
11.3.1 Orders with Sequence-Dependent Set-Up Times 183
11.3.2 Sequencing Orders with Different Routings 184
References 185
12 Flow Process Production 187
12.1 General Description 187
12.2 Main Control Attention Points of Flow Process Production 189
12.2.1 General 189
12.2.2 Cycle Time Determination 190
12.2.2.1 A Stable Level of Demand 191
12.2.2.2 Variable Demand 194
12.2.2.3 Different Cycles on One Production Line 196
12.3 Production Control Decisions for Flow Process Production in MTS Situations 196
12.3.1 Sequencing 196
12.3.2 Capacity Allocation 197
12.3.3 Work Order Release 197
12.4 Production Control Decisions for Flow Process Production in MTO Situations 197
12.4.1 Sequencing and Work Order Release 198
12.4.2 Capacity Allocation 200
12.5 Application 200
References 204
13 Mass Assembly Production 205
13.1 General Description 205
13.2 Main Control Attention Points of Mass Assembly Production 207
13.2.1 Pure Flow Production 208
13.2.2 Variants of Pure Flow Production 209
13.2.2.1 Different Processing Times 209
13.2.2.2 Variable Processing Times 211
13.2.2.3 Different Products (Needing Different Materials and/or Resources) 211
13.2.2.4 Disturbances at the Work Centers 212
13.2.2.5 No Availability of Efficient Technology 212
13.2.2.6 A Variety of Routings (Some Operations Are Skipped) 213
13.2.3 Quantitative Models for Analyzing the Effect of Buffers 214
13.2.3.1 Two Stations Without Failures 215
13.2.3.2 More Than Two Stations Without Failures 216
13.2.3.3 Two Stations with (Time-Dependent) Failures 216
13.2.3.4 More Than Two Stations with (Time-Dependent) Failures 218
13.2.4 Cross Training 219
13.3 Production Control Decisions for Mass Assembly Production 220
13.3.1 Sequencing 220
13.3.2 Capacity Allocation 220
13.3.3 Work Order Release 221
13.4 Application 222
References 224
14 Small Series Production 227
14.1 General Description 227
14.2 Main Control Attention Points of Small Series Production 229
14.2.1 Fundamental Results from Queueing Theory 230
14.2.2 Throughput Time-Related Aspects 236
14.2.2.1 Production Layout 236
14.2.2.2 Measures Based Upon Insights from Queuing Theory 236
14.2.2.3 Customer Differentiation 238
14.2.3 Lead Time Reliability Related Aspects 239
14.2.3.1 Due Date Determination Rules 240
14.2.3.2 The Effect of the Value of the Slack on the Delivery Reliability 246
14.2.3.3 Internal Versus External Due Date 248
14.3 Production Control Decisions for Small Series Production 248
14.3.1 Throughput Time 249
14.3.1.1 Sequencing 249
14.3.1.2 Capacity Allocation 252
14.3.1.3 Work Order Release/Work Order Detail Planning 256
14.3.2 Lead Time Reliability 259
14.3.2.1 Sequencing 259
14.3.2.2 Capacity Allocation 262
14.3.2.3 Work Order Release 263
14.4 Application 263
Appendix 14.A Short-Term Capacity Adjustment 265
Appendix 14.B Flexible Batching 267
Appendix 14.C The Effect of Workload Control in Case There Is a Relationship Between Productivity and Workload 268
References 271
15 (Repetitive) Project-Based Production 273
15.1 General Description 273
15.2 Main Control Attention Points of Project-Based Production 275
15.2.1 Construction of a Network 276
15.2.1.1 Terminology 276
15.2.1.2 Duration of the Activities 279
15.2.1.3 Critical Path and Project Duration in Case Activity Times Are Deterministic 279
15.2.1.4 Slack 281
15.2.1.5 Uncertainty in Project Duration Due to Stochastic Activity Times 282
15.2.1.6 Realistic Estimates of the Activity Times 284
15.2.1.7 Activity on Node Networks 284
15.3 Production Control Decisions for Project-Based Production 286
15.3.1 Sequencing 286
15.3.2 Capacity Allocation (and Scheduling) 286
15.3.2.1 Resource Loading 286
15.3.2.2 Resource Leveling 286
15.3.2.3 (Constrained Resource) Scheduling 287
15.3.3 Work Order Release/Project Scheduling 289
15.3.3.1 Work Order Scheduling 289
15.3.3.2 Work Order Release 290
15.4 Application 291
References 295
Index 297
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