Case Background

• Mrs. Santha – Owner small assembly shop
– New order for two types of sub-assemblies
• Production Line A
– Current production 315 units/day
– New order size of 420 units/day (% inc. 33.33%)
– Contribution Rs. 30/unit
– 7 workers
– Regular wage Rs. 18/hr/worker
– Overtime wage Rs. 30/hr/worker

Case Background … contd.
• 16 different tasks
• Precedence relationship
1
2
3
4
5
8
6
7
12
9
11
16
15
10
14
13
Organization of Line A
• Σt = 480 sec
• Time available = 7 * 60 * 60 = 25200 sec
• Actual cycle time = 25200/315 = 80 sec
• Production capacity = 25200/70 = 360 units/day
• Max OT = 2 hrs = 7200 sec
• Additional max production = 7200/70 = 102 (approx.)
• Max production = 360 + 102 = 462 units/day
• Max requirement = 420 units/day, implies feasible
Worker 1 1 1 1 1 1 1
Activities 1, 3 2, 5 4, 8 6, 9, 13 7, 10, 11 14, 15 12, 16
Station Time 70 70 70 70 70 60 70
Line A
• OT required = (420 – 360) * 70/(60 * 60) = 1.167 Hrs
• OT Cost/Day = 1.167 (OT) * 7 (Workers) * (Rs. 30/hr/worker) = Rs.
245
Line A Option 1
• CT
Planned
= 25200/420 = 60 sec
• Theoretical min. no. of workers reqd.
= 480/60 = 8
• Additional worker required = 8 – 7 = 1
Worker 1 1 1 1 1 1 1 1 1
Activities 2 1, 5 3, 8 4, 6 9, 13 7, 14 10, 11 12, 15 16
Station Time 50 50 60 60 60 60 60 40 40
• Actual no. of workers reqd. = 9
• CT achieved = 60 sec, implies; capacity = 420 units/day
• Training costs = Rs. 6000 * 2 = Rs. 12000
• Regular wage = 2 * 18 * 7 = Rs. 252/day
Line A Option 2
• No. of workers required = 8
• Cycle time = 60 sec
• Capacity = 420 units/day
• Balance eff. = 100%
• Training cost = Rs. 6000
• Regular wage = 1 * 7 * 18 = Rs. 126
Worker 2 1 1 1 1 2
Activities 1, 2, 3 4, 6 5, 7, 8, 9 10, 11 14, 15 12, 13, 16
Station Time 120 60 60 60 60 120
Line B
• Mrs. Uma
• Two workers
• New order size = 210 units/day
• Current organization of line B
Worker 1 1
Activities a, b, c, d e, f, g, h
Station Time 180 180
• Production capacity = 25200/180 = 140 units/day
• % inc. in reqt. = (210-140)/140 = 50%
• OT required/day = (210-140) * 180/(60 * 60) = 3.5 hrs
• Max OT available = 2 hrs
Line B Option 1
• CT
Planned
= 25200/210 = 120 sec
• Theoretical min. no. of workers reqd.
= 360/120 = 3
• Additional worker required = 3 – 2 = 1
Worker 1 1 1
Activities a, b, d c, e f, g, h
Station Time 110 120 130
• CT achieved = 130 sec, implies; capacity = 193 units/day
• OT required = (210 – 193) * 130/(60 * 60) = 0.613 hrs
• OT required (1% rejection) = 0.613/0.99 = 0.62 hrs
• Training costs = Rs. 6000; Regular wage = 1 * 18 * 7 = Rs. 126/day;
OT cost/day = 3 * 0.62 * 30 = Rs. 55.8; Rejection Cost/day = (210 –
193) * 0.01 * 420 = Rs. 71.4. Total cost/day = Rs. 253.21
Line B Option 2
Worker 1 1 1 1
Activities a, b c, d e, f g, h
Station Time 90 90 90 90
• No. of workers required = 4
• Cycle time = 90 sec
• Capacity = 280 units/day
• Balance eff. = 100%
• Training cost = 2 * 6000 = Rs. 12000
• Regular wage/day = 2 * 7 * 18 = Rs. 252
Trade-off between Option 1 &
Option 2
• Let x be the no. of days to run the assembly
line
• 6000 + 253.21 * x = 12000 + 252 * x
• X = 5000 days = 13 years (approx.)
• Option 1 is better!
Characteristics of Assembly Line
• Make to stock environment.
• Large to medium volume/standard products.
• High processing turnover
• Predefined standard Bill of Materials (BOM)
• High degree of labor & equipment utilization.
• Routing & scheduling fixed
• System fairly inflexible
• Pace of assembly line can be automatic (Machine
paced) or manual (Worker paced)
Assembly Line
Key Issues in Managing Assembly Lines
• Time standards
• Assembly line balancing
• Rebalancing
• Material availability/Materials and Supplier relations.
• Worker incentives
• Capacity Planning
• Plant Loading/Production planning
• Product design
• Product Mix
• Sequencing (to maintain balance)