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Case Analysis - FINALS
Hi-Ho Yo Yo, Inc.
It was a little 9:00 on a Monday morning when Jeff Baker walked into your office with a box of donuts. “I’ve been talking with Anne about a problem we have with short-term capacity in our pad printing operations. You know, that’s where we print our logo on the Custom lines of yo-yos. We have received more orders to pad printing in a way that will enable us to meet out due date commitments in the best way possible. Would you have time to look on the order list (attached) and see what kind of schedule we should follow to do that? By the way, you have established quite a reputation in your short stay here. You have a talent for really explaining why your recommendations are the best approach in a way that all of us “over-the-hill” managers can understand. Please be sure to do that for me too. I want to understand why your recommendation is the best schedule and what the trade-offs are for other possible schedules – and none of that philosophical college mumbo-jumbo. Remember, I came up through the ranks. I don’t have one of those sheepskins on my wall,” he says with a laugh. Since the schedule was back to normal after that MRP (Material requirements planning) report you did for Anne, you agreed to look at the information. After that compliment, how could you say no? “Try to get back to me within a couple of days,” Jeff said as he left your office. After a few minutes with your old operations management text, you call the production control office to confirm the pad printing schedule. They confirm that pad printing runs one eight-hour shift per day. They tell you that due to a make-up day for flooding in June, pad printing will be running 23 days in July, beginning Friday, July 1 (they will work three Saturdays on July 9, 16,
Hi-Ho Yo Yo, Inc. Case Analysis - FINALS and 23, and take a one-day holiday for July 4). You thank them for the information and then you begin to develop your plan. Even though Jeff lacks a college degree, from what you have seen, he is very sharp. And obviously he knows good work when he sees it since he liked, and apparently understood, your past work. You resolve to cover all the bases but in a way that it as clear as possible. PAD PRINTING ORDER LIST Job Date Received A B C D E 6/4 6/7 6/12 6/14 6/15 2 hrs 4 hrs 2 hrs 4 hrs 4 hrs 6 days 2 days 8 days 3 days 9 days 11 July 8 July 25 July 19 July 29 July Order Set-up Time Production Time Due Date
Note: Setup time is to set up the pad printer at the start of the job. Setup includes thoroughly cleaning the printing heads and ink reservoirs, installing the new pad(s) and ink supply, and carefully aligning the machine. Setup at the beginning of a new day with the same job is insignificant. Examine the following rules and write a report to Jeff Baker summarizing your findings and advise him on which rule to use. Rules: FCFS, SPT, DD and CR.
Hi-Ho Yo Yo, Inc. Case Analysis - FINALS CHAPTER I Time Context Hi-Ho YoYo, Incorporation is an organization that customizes logos for yoyos. Currently they are beginning to see an issue with rising orders and they wish to continue to meet there order process deadlines. These are ordered on June but then they will only start on July due to a make-up day for flooding. So Mr. Jeff asked for what is the scheduling to be followed in order to meet the constraints. Several rules will be evaluated in order to determine the best method of inventory scheduling. The four rules to evaluate are: First Come, First Serve (FCFS), Shortest Processing Time (SPT), Earliest Due Date (DD), and Critical Ratio (CR) methods.
CHAPTER II Viewpoint Job sequencing is an important task to determine, because it is either going to slow down the production process or speed it up. An Operations Manager should determine the best method based off the needs of the organization, which in this case will require that all jobs are completed prior to their due dates. In this sense, having a job done before the due date is a priority rule of the organization. According to the book, Operations Management, “Priority rules are simple heuristics used to select the order in which the jobs will be processed.” (Stevenson) Job processing times and due dates are very important pieces of information when applying these rules. If the sequencing rule takes in account when applying theses similar setups to other jobs, then this setup will lead to reduced setup times, which will save the organization time and money. Being able to control time, as far as controlling overtime within the production plant,
Hi-Ho Yo Yo, Inc. Case Analysis - FINALS will go far in enabling an organization to save by eliminating overtime paid to employees. Not to mention the customers will be satisfied to receive a product on schedule as well.
CHAPTER III Statement of the Problem Sequencing is concerned with determining the order in which jobs are processed. Not only must the order be determined for processing jobs at work centres but also for work processed at individual work stations. When work centres are heavily loaded and lengthy jobs are involved, the situation can become complicated. In this case study, the main problem needed to address is how to meet the constraints such as due dates, delays, etc. and to satisfy the clients’ wants despite of the increasing orders. The company experienced a delay due to a make-up day for flooding in the month of June which moves the production date of the order to July. In the month of July, it is stated in the given case that there are 3 Saturdays (July 9, 16 and 23) that the labours will continue working and they will have a holiday (July 4) aside from the weekends. So given the constraints, how will be the operation manager will choose the best scheduling on the given methods (First Come, First Serve (FCFS), Shortest Processing Time (SPT), Earliest Due Date (DD), and Critical Ratio (CR) methods). In addition, Mr Jeff also wants to have an understanding about the scheduling methods to be used in order for him to understand the process.
Hi-Ho Yo Yo, Inc. Case Analysis - FINALS CHAPTER IV Objectives Job sequencing rules are used to determine the priority for processing jobs. They are applied to tackle scheduling problems that generally lead to inefficient performance in processing job orders. Of central importance is job flow time, which is the amount of time a job spends in a shop from order placement to its completion and release. The average turnaround time on job orders is its mean job flow time, which is one way of measuring a job shop's performance. The main objective in this case study is to find the best rule to be followed in order to solve the existing problem. The following are the other objectives to be met: Defining the order in which jobs at a work centre will be administered. Sequencing decision to be made in order to meet all the due dates and satisfy the needs of the clients. Educating staff in order to give then understanding about choosing the best schedule to be made. Meeting due dates of customers or downstream operations. Minimalizing the flow time (the time a job spends in the process). Reducing work-in-process inventory. Lessening idle time of machines or workers.
Hi-Ho Yo Yo, Inc. Case Analysis - FINALS CHAPTER V Areas of Consideration/Analysis Scheduling relates to establishing both the timing and use of resources within an organization. Under the operations function, scheduling relates to use of equipment and facilities, the scheduling of human activities, and receipt of materials. In this case, there are facts given that will help in order to end up into a decision of what method to be used. “I’ve been talking with Anne about a problem we have with short-term capacity in our pad printing operations. You know, that’s where we print our logo on the Custom lines of yo-yos. We have received more orders to pad printing in a way that will enable us to meet out due date commitments in the best way possible. Would you have time to look on the order list (attached) and see what kind of schedule we should follow to do that?” In the paragraph above, it was clearly stated the problem of the Hi-ho Yoyo Incorporation. Their orders are increasing and they must find a way in order to meet due dates. “After a few minutes with your old operations management text, you call the production control office to confirm the pad printing schedule. They confirm that pad printing runs one eight-hour shift per day. They tell you that due to a make-up day for flooding in June, pad printing will be running 23 days in July, beginning Friday, July 1 (they will work three Saturdays on July 9, 16, and 23, and take a one-day holiday for July 4). You thank them for the information and then you begin to develop your plan.” Moreover, this information was given by production call office in order to create a plan and find a solution for the problem. The company needs to meet the orders within twenty-three (23) days in the month of July; twenty three days only because it was stated that the workers will have one holiday in addition to their weekends. But then, there are three Saturday that they will
Hi-Ho Yo Yo, Inc. Case Analysis - FINALS work. Each day the labourers will work for 8 hours. Given below is the illustration of the working calendar of the company: JULY Sunday Monday Tuesday Wednesday Thursday Friday 1 3 10 17 24 31 4 11 18 25 5 12 19 26 6 13 20 27 7 14 21 28 8 15 22 29 Saturday 2 9 16 23 30
Yellow Pink Red
Working Days Weekends Holiday
“Note: Setup time is to set up the pad printer at the start of the job. Setup includes thoroughly cleaning the printing heads and ink reservoirs, installing the new pad(s) and ink supply, and carefully aligning the machine. Setup at the beginning of a new day with the same job is insignificant.” In addition to the given table, the setup time is noted and the information about it is given. Because of this, this will be added to the processing time.
Hi-Ho Yo Yo, Inc. Case Analysis - FINALS CHAPTER VI Alternative Course of action According to Stevenson, priority rules are simple heuristics used to select the order in which jobs will be processed. In this case study, there are four rules given to be analysed in order to resolve the current problem. The following are the rules: 1. First Come First Serve (FCFS): This is a service policy that is based on attaining the customers or clients, in order to their onset or demand. It means that, the one who comes earlier would be given priority in the sequence of their arrival. FCFS discipline of service delivery does not take any other parameter into consideration like quantity, monetary value of the order, etc. If we select this method of delivery to our clients, we are bound to release the order in the sequence of date. 2. Shortest Processing Time (SPT): This process of scheduling is used for completion of work within the due date. This method emphasizes on processing with the job which takes the least time. The division of the work is done on the basis of input, processing time and the due date for the completion of assignment. The flow time is calculated for the each part of the job, using the processing time, which helps in determination of the overall time for the completion of work. This method is useful in single machine environment. 3. Due Date Scheduling Technique (DD): This technique of scheduling can be used with the reference of time either forward or backward. When forward scheduling is used, it started with the date from which job order starts. It calculates the period of time, from the day on which first operation was performed to all the subsequent operation till the completion of the work. It determines the earliest time on which the
Hi-Ho Yo Yo, Inc. Case Analysis - FINALS work can be completed. When the technique of back scheduling is used for calculating the period of time of the completion of work, the resources are allocated in reverse order keeping in mind the deadline of the completion of work and come to the date on which must start the operation, so that the work can be completed within the due date. 4. Critical Ratio: Critical Ratio is an index number computed by dividing the time remaining until due date by the work time remaining. As opposed to priority rules, critical ratio is dynamic and easily updated. It tends to perform better than FCFS, EDD, and SPT on the average job lateness (delays) criterion. The critical ratio gives priority to jobs that must be done to keep shipping on schedule. It is used in conjunction with MRP systems and has broad industrial application. The critical ratio is measure of urgency of any order compared to the other orders for the same facility. The ratio is based on when the completed order is required and how much time is required to complete.
These rules assume that setup time and setup costs are independent of the processing sequence. However, this is not always the case. Jobs that require similar setups can reduce setup times if sequenced back to back. In addition to this assumption, the priority rules also assume that setup time and processing times are deterministic and not variable, there will be no interruptions in processing, the set of jobs is known, no new jobs arrive after processing begins, and no jobs are cancelled.
Hi-Ho Yo Yo, Inc. Case Analysis - FINALS CHAPTER VII Recommendation Comparing the four methods, SPT is recommended to be used by the company because it reduces average flow time for jobs. Since there are constraints such as they have to meet all the orders within 23 days and the working hours is eight (8) hours per day, using this method they will finished all the orders at the shortest period of time. Also, the flow time is calculated for the every part of the job, using the processing time, which helps in getting whole time for the completion of work. In First come/first served method (FC/FS) it could not be applied because in this rule, jobs are processed in the order in which they arrive. The orders must be finished in a shortest period of time and not on how when the order arrived since they did not started the production on June (arrival of orders) due to a problem. They started on July and this will not follow the rule. Next, under Earliest due date method (EDD), it places the highest priority on processing jobs with the earliest due dates. Job shop quality performance can be measured by the number of late jobs, the average tardiness across late jobs or the average tardiness across all jobs. This seems to work well if the firm performance is judged by job lateness. If this will be used, the process will follow a track based on due dates of the orders and maybe it will not meet the time constraints given. Lastly the critical ratio method (CR), in this rule one must calculate a priority index using the formula (due date–now)/ (lead time remaining). This rule is widely used in practice. However in this rule, the sequencing of the jobs is done first by getting the critical ratio of each job then selecting the lowest among them. Then it is repeated eliminating the job with the lowest CR point until one job is left.
Hi-Ho Yo Yo, Inc. Case Analysis - FINALS By choosing Shortest processing time (SPT), the job with the shortest processing time requirement goes first. This rule tends to reduce work-in-process inventory, average throughput time, and average job lateness. So this is the most appropriate rule to be used in order to meet the limitations. CHAPTER VIII Conclusion/Detailed action Plan A report about the choosing the Short Processing Time method must be made and this will be used for the production. It must in detailed information so that the schedule will be followed. Other points to implement:
Align demand and delivery; Increase flexibility and reduce response/lead times at key points in the supply chain;
Enable lean operations: reduce inventories and costs while meeting delivery commitments.
Cost reduction can be achieved by a schedule that considers all rules and constraints. Ignoring a rule/constraint usually results in increased cost due to reduced productivity, higher inventory, increased offline work, overtime etc.
Customer Relationship Management Dealer Order Management Material planning Scheduling of feeder lines Vendor supply chain management
Hi-Ho Yo Yo, Inc. Case Analysis - FINALS
Job A B C D E Job A B C D E Total
Date Order Set-up Time Received 6/4 2 hrs 6/7 4 hrs 6/12 2 hrs 6/14 4 hrs 6/15 4 hrs Processing Time Flow time (days) 6 6 2 8 8 3 9 28 days 16 19 28 58 days
Production Time 6 days 2 days 8 days 3 days 9 days
Due Date 11 July 8 July 25 July 19 July 29 July
Days to Due date 7 5 19 14 23 68 days
Based on the given information and initial table above, each method will be used for the computation the criteria to be considered in choosing the best technique. Sequence Average Flow Time / Average completion time Average Tardiness / delays Utilization / Average # of Jobs at Work Center Make span
Hi-Ho Yo Yo, Inc. Case Analysis - FINALS Solution using FCFS Method: In HOURS: FCFS Sequencing Total Production Processing Flow Time Time Time (hours) (hours) (hours) 48 50 50 16 20 70 64 66 136 24 28 164 72 76 240 240 660
Hours Hours Job Due Tardy A 56 0 B 40 30 C 152 0 D 112 52 E 184 56 544 138 Total Sequence A, B, C, D, E Average Flow Time / Average completion time (sum of total flow / no. of jobs) (660 hours / 5 jobs) 132.00 Average Tardiness / delays (total delays / no. of jobs) (138 hours / 5 jobs) 27.6 Utilization / Average # of Jobs at Work Center (total flow time / total processing time) (660 hours / 240 hours) 240.00 Make span 2.75
Set-up Time (hours) 2 4 2 4 4
Date Due 11-Jul 8-Jul 25-Jul 19-Jul 29-Jul
Days Due 7 5 19 14 23 68
Job A B C D E Total
Set-up Time (days) 0.0833 0.1667 0.0833 0.1667 0.1667
Processing Time (days) 2 3 6 8 9
Total Time (days) 2.0833 3.1667 6.0833 8.1667 9.1667 28.6667
Sequence Average Flow Time Average Tardiness Make span Average # of Jobs at Work Centre 2.33
Flow Time Date (days) Due 2.0833 11-Jul 5.2500 8-Jul 11.3333 25-Jul 19.5000 19-Jul 28.6667 29-Jul 66.8333 A, B, C, D, E 13.37 8.833333333 28.67
Days Due 7 5 19 14 23 68
Hours Due (8 hours per day only) 56 40 152 112 184 544
Converted into Days 2.333333333 1.666666667 6.333333333 4.666666667 7.666666667 22.66666667
Hours Tardy 0 4 5 15 21 44
Hi-Ho Yo Yo, Inc. Case Analysis - FINALS
Solution using SPT Method: SPT Sequencing Total Production Processing Flow Time Time Time (hours) (hours) (hours) 16 20 20 24 28 48 48 50 98 64 66 164 72 76 240 240 570
Job B D A C E Total
Set-up Time (hours) 4 4 2 2 4
Date Due 8-Jul 19-Jul 11-Jul 25-Jul 29-Jul
Days Due 5 14 7 19 23 68
Hours Due 40 112 56 152 184 544
Hours Tardy 0 0 42 12 56 110
Sequence Average Flow Time / Average completion time (sum of total flow / no. of jobs) (570 hours / 5 jobs) Average Tardiness / delays (total delays / no. of jobs) (110 hours / 5 jobs) Utilization / Average # of Jobs at Work Center (total flow time / total processing time) (570 hours / 240 hours) Make span Solution using EDD Method: EDD SEQUENCE Total Production Processing Flow Time Time Time (hours) (hours) (hours) 16 20 20 48 50 70 24 28 98 64 66 164 72 76 240 240 592
B, D, A, C, E
114.00 22 2.38 240
Job B A D C E Total
Set-up Time (hours) 4 2 4 2 4
Date Due 8-Jul 11-Jul 19-Jul 25-Jul 29-Jul
Days Due 5 7 14 19 23 68
Hours Due 40 56 112 152 184
Hours Tardy 0 14 0 12 56 82
Hi-Ho Yo Yo, Inc. Case Analysis - FINALS Sequence Average Flow Time / Average completion time (sum of total flow / no. of 118.40 jobs) (592 hours / 5 jobs) 16.4 Average Tardiness / delays (total delays / no. of jobs) (82 hours / 5 jobs) Utilization / Average # of Jobs at Work Center (total flow time / total 2.47 processing time) (592 hours / 240 hours) Make span Another approach: Job JOB TIME (Set up and Date Order Due Run Time) (in hours) Received Date A B C D E 6 days + .083 days (2 hours) = 6.083 days 2 days + .17 = 2.17 days 8 days + .083 = 8.083 days 3 days + .17 = 3.17 days 9 days + .17 = 9.17 days 6/4 6/7 6/12 6/14 6/15 11 July 8 July 25 July 19 July 29 July Days to SPT Due date Sequence 36 days 30 days 42 days 34 days 43 days B D A C E EDD Sequence B D A C E
240 B, D, A, C, E
Hi-Ho Yo Yo, Inc. Case Analysis - FINALS CR Sequencing TABLE 1 Total Processing Time Date (hours) Due 50 11-Jul 20 8-Jul 66 25-Jul 28 19-Jul 76 29-Jul
Job A B C D E
Set-up Production Time Time (hours) (hours) 2 48 4 16 2 64 4 24 4 72
Days Due 7 5 19 14 23
Hours Due 56 40 152 112 184
CR Ratio 1.12 Lowest 2.00 2.30 4.00 2.42
Job CR Ratio Computation A (56 – 0) / 50 B (40 – 0) / 20 C (152 – 0) / 66 D (112 – 0) / 28 E (184 – 0) / 76
A B C D E
4 2 4 4
16 64 24 72
CR Sequencing TABLE 2 (Hour 48) FINISHED (1st) 20 8-Jul 66 25-Jul 28 19-Jul 76 29-Jul
Job CR Ratio Computation B (40 – 50) / 20 C (152 – 50) / 66 D (112 – 50) / 28 E (184 – 50) / 76
5 19 14 23
40 152 112 184
-0.50 Lowest 1.55 2.21 1.76
JOB B = The job is on schedule. JOB D = The job is ahead of schedule JOB C & E = The job is falling behind the schedule. And have some slack. CR Sequencing TABLE 3 (Hour 64) A B C D E FINISHED (1st) FINISHED (2nd) 66 25-Jul 28 19-Jul 76 29-Jul
Job CR Ratio Computation C (152 – 70) / 66 D (112 – 70) / 28 E (184 – 70) / 76
2 4 4
64 24 72
19 14 23
152 112 184
1.24 Lowest 1.50 1.50
Hi-Ho Yo Yo, Inc. Case Analysis - FINALS JOB C = The job is on schedule. JOB D & E = The job is falling behind the schedule. CR Sequencing TABLE 4 (Hour 88) A FINISHED(1st) B FINISHED(2nd) C FINISHED (3rd) D 4 24 28 19-Jul E 4 72 76 29-Jul
Job CR Ratio Computation D (112 – 136) / 28 E (184 – 136) / 76
-0.86 lowest 0.63
JOB D= The job is on schedule. JOB E = The job is falling behind the schedule. CR Sequencing Set-up Time (hours) 2 4 2 4 4 Processing Time (hours) 48 16 64 24 72 Total Time (hours) 50 20 66 28 76 240 Flow Time (hours) 50 70 136 164 240 660 Date Due 11-Jul 8-Jul 25-Jul 19-Jul 29-Jul Days Hours Due Due 7 56 5 40 19 152 14 112 23 184 68 Hours Tardy 0 30 0 52 56 138
Job A B C D E Total
Sequence B, D, A, C, E Average Flow Time / Average completion time (sum of total flow / no. of jobs) (660 hours / 5 jobs) 132.00 Average Tardiness / delays (total delays / no. of jobs) (138 hours / 5 jobs) 27.6 Utilization / Average # of Jobs at Work Center (total flow time / total processing time) (660 hours / 240 hours) 2.75 Make span 240
Hi-Ho Yo Yo, Inc. Case Analysis - FINALS Comparison of Sequencing Rules Average Flow Time 132.00 114.00 118.40 132.00 Utilization/ Average Jobs at Work Average Centre Tardiness 2.75 27.60 Worst 2.38 22.00 Best 2.47 16.40 Good 2.75 27.60 Worst
Rules FCFS SPT EDD CR
In the table above, it is clearly shown what method to be used. Based on the average tardiness column, it clearly presented that SPT got the lowest point followed by EDD and the methods that gain bigger average tardiness is under FCFS and CR method. Shortest processing time is generally the best technique for minimising job flow and minimising the average number of jobs in the system. Its chief disadvantage is that longduration jobs may be continuously pushed back in priority in favour of short-duration jobs. Customers may view this dimly, and a periodic adjustment for longer jobs has been made.