Case Study 2: Flexible Manufacturing Systems

A manufacturing facility has decided to purchase a new, top-of-the-line Flexible Manufacturing System
(FMS) to take over a large portion of the production of their widgets manufacturing operation. The company
currently makes all its products using a craftsman approach, where a single worker makes each product from
beginning to end. Each worker is paid for the time spent in production, and there are three different pay
rates, depending on the worker’s skill. The company has been in discussions with several suppliers and have
settled on a specific FMS as the best option. This FMS has six stations, each one performing different tasks,
and a material handling system. The supplier has estimated how much time would be required for each
widget at each station. Each station also has an associated operating cost per minute. The attached file
Case2Data.xlsx in sheet CandidateParts contains information on each of the 80 candidate parts that the
company is considering to produce in the FMS. The data includes average monthly demand for each part,
current processing time per unit (in minutes), type of craftsman required, as well as the time required at
each station of the FMS per unit (also, in minutes). Separate tables in the same sheet have the operating
costs of each station of the FMS per minute and the per minute cost of each type of craftsman. The company
wants to use this information to decide which parts to assign to the new FMS for production, considering
they work three shifts of eight hours, seven days a week.
This will be the first FMS that this manufacturer purchases. Therefore, they are also interested in
developing a method for planning production in the FMS. The company normally plans their production
weekly. The attached file Case2Data.xlsx in sheet PartsToPlan contains information on 26 products that
are representative of the types of parts that the company is likely to make in the FMS (note, this is not the
optimal set of products from the Candidate list). In sheet OrdersToPlan there is information about a typical
set of orders for a week, including the product, the amount and the time period (shift) when the order is due.
Note there are 21 shifts in one week. Note also that no information on tools is provided, this is because the
tool magazines in the FMS are large enough to hold all the necessary tools to produce all 26 parts without
changes. Hence, you may assume that the time to setup between different products is negligible.
This company has hired you as a consultant to help them transition part of their craftsman-style pro-
duction to the FMS. They want you to recommend a set of products to move to the FMS and propose a
methodology and a tool to do the weekly batching of production into shifts. After some preliminary work,
you have settled on four specific tasks that you are going to perform. Your job is to perform the four tasks
and present a report with your findings.

Tasks
1. Write an optimization model in general form to decide which products should be produced in the
FMS to maximize the savings, without exceeding the capacity. Hint: The model should be similar to
the knapsack model covered in class (except we don’t have an obvious bottleneck).
2. Solve the optimization model from the previous question with the data provided in file Case2Data.xlsx
in sheet CandidateParts. Assume a month has 30 days of 24 hours. Hint: The model is small enough
to solve in Excel Solver.
3. Propose two alternative methodologies to batch the orders in the FMS:
(a) Minimize holding cost: Write an optimization problem in general form to solve this problem.
Hint: The model should be similar to the “Part Selection Problem” covered in class, but does
not need to consider tools.
(b) Minimize lateness: Write a Greedy Algorithm to solve this problem. Hint: The algorithm should
be similar to greedy algorithm covered in class for the “Part Selection Problem”, but does not
need to consider tools.
 4. Choose one method from the previous question and develop a computer code (in Python, MATLAB,
etc., calling GUROBI or CPLEX if needed) and apply it to the order data in sheet OrdersToPlan, also
using data from sheet PartsToPlan. Assume you want to batch the orders in at most 21 shifts of 8
hours each. Your code should:
• Read the data from 2 plain text files (such as *.csv), one for parts data and the other for order
data.
• Use either optimization or the greedy heuristic to solve the appropriate problem.
• Print the results in an easy-to-read format in a new plain text file.
• Be thoroughly commented and easy to read.
• Sharing code between teams, or using code directly copied from other classes, semesters,
etc. is prohibited and will be considered an Honor Code violation.
5. (Extra Credit) Repeat the previous question for the other methodology from Question 3.
Once you complete the tasks, you will write a report. The report must typed, 11 point font and
single spaced. It must include the following:

1. A one-page executive summary, briefly describing the problem and summarizing your main findings
and giving your final buffer recommendation.
2. A four-page (or shorter) technical report, which includes a section for each task. Each section should
include all your results for the task, a brief description of how you got the results and a reference to
the supporting files that you used for each task (if applicable).
3. The report should be self-contained and should not require the reader to look at any other files.
4. Use tables and figure to describe your results, as appropriate.

Work in pairs. Please deliver the a single *.zip file via one CANVAS account, including your report in
*.pdf, your model files and any additional files that you deem relevant. We will only grade the report,
and use other ftles to check your work.

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 Case Study 2 - Grading Rubric

Task Unacceptable/Poor: Acceptable: 50-80% Good/Excellent: 90-

0-40% 100%
Executive Does not provide a sum- Summary provides most, Includes a well-written,
summary (10 mary, or summary is cur- but not all, the main re- well-organized summary,
pts) sory with minimal infor- sults. Is not clear about providing a clear recom-
mation provided, lacking the recommendations or is mendation and summary
recommendations. not well-organized. of the results.
Report overall Report is not self- Writing and organization Report is well-written and
(10 pts) contained, very poorly are acceptable, but may well-organized. It in-
written or organized. have some issues. Report cludes detailed analysis
includes all results, but no and reaches reasonable
analysis or conclusions. conclusions.
1. (10 pts) Does not include an opti- Model is provided but no- Provides a correct model
mization model in general tation is not clearly de- with clear and concise def-
form. fined. Or model has mis- initions of every param-
takes. eter, variable and con-
straint.
2. (20 pts) No solution given or solu- Solution has errors, but Solution is exactly correct,
tion is obviously wrong. approach is sound, model as well as model, both are
is mostly correct but has presented clearly.
error. Or solution ap-
pears correct but is not
presented clearly.
3.a (5 pts) Does not include an opti- Model is provided but no- Provides a correct model
mization model in general tation is not clearly de- with clear and concise def-
form. fined. Or model has mis- initions of every param-
takes. eter, variable and con-
straint.
3.b (5 pts) Does not provide a step- Algorithm is provided but Provides a correct algo-
by-step algorithm. Or al- notation is not clearly de- rithm with clear and con-
gorithm is very wrong. fined. Or has mistakes. cise definitions of every
step.
4. (40 pts) Model file does not run or Model file reads data, runs A clear, well organized,
does not produce a sound and produces a solution commented code, reads
solution. Or does not read file, but with errors. Or and writes files and pro-
or write text files. code is confusing and not duces the correct solution.
commented.
5. (20 pts) Model file does not run or Model file reads data, runs A clear, well organized,
does not produce a sound and produces a solution commented code, reads
solution. Or does not read file, but with errors. Or and writes files and pro-
or write text files. code is confusing and not duces the correct solution.
commented.

Penalties:
• Does not respect font/spacing/length requirements: -25
• Does not include optimization/heuristic files: -30
• Notable writing errors (spelling, grammar, syntax, etc.): -1 each time