Production Technology& Decision-Making - Selection and Management

Transcription

1 Production Technology& Decision-Making - Selection and Management Flexible Automation Wave of the Future The coming thing in manufacturing is the all-purpose factory, one that linked together by computer and can produce several products on the same assembly line without costly or elaborate retooling. That day is not here yet, but scientists have mad such dramatic strides in flexible manufacturing that some factories are capable of making a family of products or parts on the same line Advanced or high-tech production technology means applying the latest scientific or engineering discoveries to the design of production process. Many companies are capturing substantially increased market shares because of such efforts. New technology can mean a wide range of scientific and engineering breakthroughs. Type of Automation Enormous industrial automation has brought automated machines with diverse features. These types of automation are particularly noteworthy: machine attachments, numerically controlled (N/C) machines, robots, automated quality control inspection, automatic identification system (AIS), and automated process control.

2 Evolution of Numerically Controlled Machines 1. Numerically controlled machine tool MIT developed, operator must still select tools and load and unload machine. 2. Automatic tool changing raising the productivity of general-purpose machine tools. In this system not only machine guidance instructions but also information for selecting the right tool from a bank from 20 to 100 tools. Tool changing time can be as little as two seconds. 3. Computer numerical control this change not only made editing and altering programs easier but also made a computer available for a variety of other tasks, such as logging the time each tool is in use. 4. Direct numerical control machines can be of different types and programmed to carry out different tasks. Automated Production Systems As the technology of automation has become more sophisticated, the focus has shifted away from individual machines and toward a broader concept. Four general categories of these system: 1. Automated flow lines 2. Automated assembly systems 3. Flexible manufacturing system (FMS) 4. Automated storage and retrieval system (ASRS) Automated flow lines Includes several automated machines that are linked together by automated parts transfer and handling machines. The individual machines on the line use automated raw material feeders and automatically carry out their operations without he need for human attendance. These systems are ordinarily used to produce an entire major component, for example, rear axle housing for trucks. Automated assembly systems A system of automated assembly machines that are linked together by automated materials-handling equipment. Materials are automatically fed to each machine, which is ordinarily some type of robot. For an automated assembly system to be successful, major product design modifications are necessary. The product design and assembly methods appropriate for assembly by human hands cannot be directly applied to an automated assembly system because the capabilities of human beings cannot be duplicated by robots. Principles to redesigning products for automated assembly: 1. Reduce the amount of assembly required: use one plastic molded part instead of two sheet metal parts that must be fastened together. 2. Reduce the number of fasteners required: design parts that snap together or can be welded together. 3. Design components to be automatically delivered and positioned: designing parts so

3 that they can be fed and oriented for delivery form parts hoppers, slotted chutes, vibratory bowls and other part-feeding mechanisms. 4. Design products for layered assembly and vertical insertion of parts: assembled from a base upward in layers to the top of the product. 5. Design parts so that they are self-aligning: automatically position and align the parts as they are inserted into assemblies. 6. Design products into major modules for production: by breaking the assembly of the whole product into several assembly modules, downtime of the system is reduced. 7. Increase the quality of components: avoid jams in the feeding and assembly mechanisms. Flexible manufacturing system (FMS) Groups of production machines, arranged in a sequence, connected by automated materials-handling and transferring machines, and integrated by a computer system. Automated storage and retrieval system (ASRS) Three major elements of ASRS: 1. Computers and communication systems: used for placing orders for materials, locating the materials in storage, giving commands for delivery of the materials to locations in operations, and adjusting inventory records showing the amount and location of materials. 2. Automated materials-handling and delivery systems: automatically loaded with containers (order) of materials from (at) operations (warehouse) and deliver them to the warehouse (work stations in operations) 3. Storage and retrieval systems in warehouses. The main purposes of installing ASRS Increase storage capacity: storage density Increase system throughput Reduce labor costs Improve product quality: human error in identifying material, the wrong parts are often delivered and assembled into products. Characteristics of Factories of Future High product quality High flexibility Fast delivery of customer orders Changed production economics Computer-driven and computer-integrated systems Organization structure changes Automation in Services: examples (see table attached on right)

4 The Decision-Making Process There are 3-type of decisions to be made. 1. Type I. Decision (Strategic Decisions): Decisions about products, processed and facilities. These decisions concern operations strategies that have long-term importance for the organization. Example: Deciding to launch a new product development project Design a production process for a new product. Deciding what new facilities are needed and where to locate them. Etc. 2. Type II. Decision (Operating Decisions): Decisions about planning production to meet demands. In general, deciding about the on-going activities of products. Example: Deciding inventory policies that govern the amount and product inventory to carry. Deciding what products and what quantities of each to include in next month s production schedule. Deciding whether to increase production capacity next month by having the foundry department work overtime. Deciding on a plan for purchasing raw materials to support next month s production schedule. 3. Type III. Decision (Control decision): Decisions about planning and controlling operations. Example: Deciding what to do about a department failure to meet the planned labor cost target. Developing labor cost standards for a revised product design. Deciding what new quality control acceptance criteria should be for a product has had a change in design (robust design). Deciding how often to perform preventive maintenance on a key place of productive machining. Characteristic of Decision 1. Degree of Uncertainty (a) What variable are important (b) The relationship between the variables (c) The value of the variable A. Subjective Methods usually involves (a) Operating as if conditions of certain were present by selecting the most important variables (MIV) while ignoring the effect of all others. (b) Assume the most likely relationship between the MIV. (c) Estimate as precisely as possible the values of the MIV. B. Objective Methods usually involves (a) Spending money, time, and human efforts to gather data to reduce the level of uncertainty (b) Developing analysis based upon 3 or more level of optimism.

5 (c) Developing or estimating the probability of each outcome. 2. Degree of Complexity Refer to number of variables, the network of relationship between the variables, and the relation ship between decisions. 3. Decision Time Frame The amount of time available to make a decision may be the over-riding determinant of how a decision can be made. Some decision must be made instantaneously. 4. Expected Returned Relation to Cost of Analysis The amount of money that should be spent on analysis is to a large degree a function of the returns expected from the decision. 5. Degree of Recurrence A pattern is set for all similar future decisions. 6. Intensity of Decision Impact High return good decision Great loss poor decision 7. Duration of Decision Impact The lasting effect of the decision made The degree of presence of decision characteristics in the 3 type decisions Uncertainty Complexity Time Average Expect Return Intensity Duration Recurrence Impact Type I uncertain complex long high high long high Type II Type III certain Non-compl ex shot low low short low The Systematic Process of Decision Making 1. Define & Describe the Problem & Its Magnitude Result A problem would defined is half solved Path Determine causes then the obvious symptom How Dig through records, gather data, interview ask question, analyze, etc. 2. Generate Alternative Solution Approach Generate alternatives regardless of feasibility Shorten the list by eliminating those with no promise of feasibility Combine those that have commonality, and modifying others. (*Brainstorming) 3. Analyze the Alternative Collect data from historical records, observations Compute the compare using cost analysis linear programming, or other methods Example: Assume the NCHU company needs to produce 8,000 parts named Rabbit. There are 3 different types production line can be use. Please find the most efficiency process to make it.

6 Process A can produce 4,000 units in one batch, but the set up cost and material cost are $1,000 and $2.0 respectively. Process B can produce 6,000 units in one batch, but the set up cost and material cost are $1,900 and $1.8 respectively. Process C can produce 8,000 units in one batch, but the set up cost and material cost are $3,500 and $1.75 respectively. Example1: In profit oriented decision, we assume that money is the most important fact, and result in selecting the alternative to the lowest cost (Unit Cost) Example 2: (a) Two batches by process A (b) One complete batch plus 2,000 units by B process (c) 8,000 units by process C Example 3: Alternative 1. Total Cost = 2 (1, x 4,000) = $18,000 Cost/Unit = 18,000/8,000 = $2.25/Unit Alternative 2. Total Cost = (1, x 6,000) = (1, x 2,000) = $18,200 Cost/Unit = 18,200/8,000 = $2.275/Unit Alternative 3. Total Cost = 3,5, x 8,000 = $17,500 Cost/ Unit = 17,500/8,000 = $2.1875/Unit The best alternative is 3 process C 4. Weigh & Decide Among the Alternatives Analysis tells directly what alternative must be selected Analysis such a minor step in decision making that we skip altogether Decision Processor Analysis & Logic Society & Culture Emotion Experience Personal Motives Instruction Output Processor Input 5. Formulate a Plan for Implementation Establish planning and programming functions to aid management for making implementation (Task, Task Assignments, or Time table for completing tasks)

7 6. Formulate a Contingency Plan Estimate factors as market size, manufacturing costs, technology developments, and product or service performance. Identify factors that may go wrong in carrying out a decision and develop a plan of corrective action. Case Study for Decision Making Mr. Smith is the sole decision-maker in the smith and Sons Company which manufactures metal parts for other manufacturing companies. Recently A & H Pump Manufacturing Company, which used to order cast iron pulleys from Smith, has modified its product and now uses plastic pulleys which they order from another supplier. Now Mr. Smith has to make a decision to cope with this unfortunate situation. Step 1. In this step Mr. Smith has to identify the available alternatives. After a week of thinking and studying, he comes up with the following alternatives. 1. Expand his operations to include plastic parts an persuade A & H to order pulleys form him. 2. Accept orders for mixer blades from Baker Construction Company that he had earlier rejected due to low profitability. 3. Fire half of his labor force and use the rest in producing parts for another manufacturing. There could be a dozen more alternatives which we have not included here, The disadvantage of some of the alternatives could be so obvious that Mr. Smith would not even bother to include them in his consideration. Other alternatives may simply not occur to him, and there is always a last alternative which are considered in this step often are called competing alternatives, meaning that their superiority over one another is not obvious. Step 2. In this step criterions for comparison is selected. Since Smith & Sons is a company which is in business to make money, the monetary value of each alternative is selected as the criterion. Of course other considerations could exist. For example, if the business is a very small one located in a small community, Mr. Smith may be reluctant to fire the people even though that might be the best alternative as far as the cost is concerned. At this point, let us assume that the money is the most important factor and Mr. Smith chooses to select the alternative which results in the highest profit or the lowest loss. Step 3. This is the evaluation step. In this step Mr. Smith has to gather all the facts and figures about each alternative and then evaluate their profitability. Let us assume that he has gathered the following information. Alternative 1. To procure the equipment needed for plastic molding will cost the company an additional $3,000 a year for investment and operation costs for the next five years, which is the anticipated life of the project. In addition, since the technology is different from the current activities of the company, a skilled foreman has to be hired who would be paid $15,000 a year. However, the revenue from production of pulleys will increase from $120,000 to $150,000 a year. The current capital, operation and labor costs for the pulley division is estimated to be $80,000 a year.

8 Alternative 2. To accept the previously rejected order will be possible without any addition to the capital equipment and labor. The total revenue in this case would decline to $60,000 a year. Alternative 3. Firing half of the labor force will result in savings of $30,000 in labor and produce revenue of $40,000 a year for the next five years from making parts for another manufacturer. To evaluate the alternatives, the profit from each alternative is calculated. Since all the alternatives are for an equal time span only yearly profit need be evaluated. Alternative 1 Revenue $150,000 Cost Current costs $80,000 Additional Equipment $30,000 Additional Labor $15,000 Total Cost $125,000 Profit $ 25,000 Alternative 2 Revenue $60,000 Cost Current Cost $80,000 Profit - $20,000 Alternative 3 Revenue $ 40,000 Cost Current costs $80,000 Savings in labor - $30,000 Total Cost $ 50,000 Profit - $ 10,000 Step 4. In this step the value of these alternatives are compared. This comparison indicates that the first alternative is Mr. Smith's best choice. It results in a profit of $25,000 a year, while both second and third alternatives produce a loss. Thus our four-step decision making process comes to an end. Case Study 2 John and Associated is a manufacturing company producing home appliances. The company is now preparing to plan the next year's production schedule. One alternative is to follow the current line of production that is the manufacture of conventional oil burning heaters (OBH). In that case the company will not need any additional investment and will produce 20,000 heaters at the cost of $200 each. The sales department has come up with a proposal for producing wood burning heaters (WBH). The selling price for either type of heater is $300. If the existing capacity of the company is altered entirely to produce wood-burning heaters only, 10,000 units

9 can be produced at a cost of $150 per heater plus a fixed amount of $500,000 in set-up costs. There is, however, a third alternative in which the company can maintain half of its current operation and convert the other half to the production of 5,000 wood burning heaters. This arrangement will cause the operation cost for two types of heaters to go up to $220 and $175, respectively. The set-up cost in this case would be $300,000. So far, nothing has been said about the uncertainties because it is assumed that making the decision and paying for costs is going to take place now. Present costs can be estimated with a fair degree of certainty. The uncertainty arises from the fact that the revenues from sales are realized in the future. For simplicity, let us assume that the damned for heaters depends on only two factors, weather and the supply of oil. Also, let us assume that the weather can be classified to be either very cold or mild and the oil supply can be either high or low. Thus, the following four situation may arise in the future each causing different demand for heaters: 1. Very cold with high levels of oil supply which will result in a demand of 20,000 units for oil burning heaters and none for wood burning units. 2. Very cold with low levels of oil supply which will result in a demand of 10,000 oil burning units and 10,000 wood burning units. 3. Mild with high levels of oil supply which will result in a demand of only 10,000 oil burning units. 4. Mild weather and low levels of oil supply which will result in a demand of 5,000 units of heaters from each type. Since the states of future events are not known at present, the profit from each of the three alternatives cannot be evaluated with certainly. If the first alternative of producing 20,000 units of OBH is selected Situation 1: all 20,000 units will be sold Revenue 20,000 x 300 $6,000,000 Cost 20,000 x 200 $4,000,000 Profit $2,000,000 Situation 2: only 10,000 of the units will be sold, and the customer of WBH will go to another producer. If we assume the remaining heaters are no value Revenue 10,000 x 300 $3,000,000 Cost 20,000 x 200 $4,000,000 Profit $-1,000,000 Situation 3: same as the previous situation Situation 4: Revenue 5,000 x 300 $1,500,000 Cost 20,000 x 200 $4,000,000

10 Profit $-2,500,000 The outcome of this alternative is uncertain. Formulation of the problem I. Courses of Action: Each available alternative is call one course of action, a i, where i = 1, 2, 3,..., n. Three courses of action in the above example a 1 : 20,000 oil burning heaters a 2 : 10,000 WBH a 3 : 5,000 OBH, 5,000 WBH II. States of Nature: Each possible future event, j, where j = 1, 2, 3,..., n. 1 : very cold, high level of oil 2 : very cold, low level of oil 3 : mild cold, high level of oil 4 : mild cold, low level of oil III. Pay-off Table: a table in which each row belongs to one course of action and each column represents one state of nature. a 1 20,000OBH a 2 10,000WBH a 3 5,000OBH, 5,000WBH Course of action a 2 is producing 10,000 units of WBH, The cost: production cost 10,000 x 150 = 1,500,000 Set up cost 500,000 Total cost 2,000,000 a 2 1 :Demand 20,000 OBH Supply none Sold 0 Revenue 0 Cost 2,000,000 Profit -2,000,000

11 a 2 2 :Demand 10,000 OBH, 10,000 WBH Supply 10,000 WBH Sold 10,000 WBH Revenue 10,000 x 300 = 3,000,000 Cost 2,000,000 Profit 1,000,000 a 2 3 :Demand 10,000 OBH Supply none Sold 0 Revenue 0 Cost 2,000,000 Profit -2,000,000 a 2 4 :Demand 5,000 OBH, 5,000 WBH Supply 10,000 WBH Sold 5,000 WBH Revenue 5,000 x 300 = 1,500,000 Cost 2,000,000 Profit -500,000 For third course of action is producing 5,000 OBH & 5,000 WBH The fixed cost Cost of OBH 5,000 x 220 = 1,100,000 Cost of WBH 5,000 x 175 = 875,000 Set up cost 300,000 Total cost 2,275,000 Procedure same as the previous a 2 a 3 1 : -775,000 a 3 2 : 725,000 a 3 3 : -775,000 a 3 4 : 725,000 Pay-off table can be completed a 1 20,000OBH a 2 10,000WBH ,000,000-1,000,000-1,000,000-2,500,000-2,000,000 1,000,000-2,000, ,000

12 a 3 5,000OBH, 5,000WBH -775, , , ,000 Analysis of Pay-off Table Maximim Criterion: Decision maker chooses the action that maximizes the gain among the worst cases. (Conservative approach) 1. Find the lowest value from each row 2. Find the max. among these value 3. The action related to the row corresponding to this value is the best alternative a 1 20,000OBH a 2 10,000WBH a 3 5,000OBH, 5,000WBH min 2,000,000-1,000,000-1,000,000-2,500,000-2,500,000-2,000,000 1,000,000-2,000, ,000-2,000, , , , , ,000 Max. Maximax Criterion: Pick the alternative which maximized profit if the most ideal state of nature occurs. (Optimistic approach) a 1 20,000OBH a 2 10,000WBH a 3 5,000OBH, 5,000WBH max 2,000,000-1,000,000-1,000,000-2,500,000 2,000,000 Max. -2,000,000 1,000,000-2,000, ,000 1,000, , , , , ,000 Minimax Regret Criterion: Since the decision maker does not have control on the future states of nature, he could try to take the course of action that will cause the least regret after the state of nature is known. 1. Find the max regret from each row 2. Find the min among these max. 3. Take the course of action corresponding to this min. a 1 20,000OBH max 0 2,000, ,000 3,225,000 2,000,000

13 a 2 4,000, ,225,000 1,225,000 4,000,000 10,000WBH a 3 5,000OBH, 5,000WBH 2,775, , ,775,000 Min **There is no sure and single way to make the decision for uncertainty. Levels of Analysis - Intuition: uses intuitions, gut feelings, or instinctive leanings to arrive at spur-of-the-moment decisions. - Quick and Dirty: used for day-to-day decisions. - Intensive Computations: used when the relative importance of the decision is high. - Modeling Building: usually a mathematical model that is a simplified abstraction from the real system under study. - Task Force: a group of high-level personnel who are signed to collectively analyze a decision and arrive at a recommended course of action. Planning, Analysis, and Control of Production Systems - The end product of planning, analysis, and control efforts is a decision. The techniques associated with each phase of an evaluation are useful only if they contribute to that end. - Planning, analysis, and control are more descriptive of the mental set of a decision maker than of a rigid problem-solving procedure. Each phase is distinguished by an objective to anticipate, to investigate, to regulate, to design. - A familiarity with the many types of models available to the modern decision maker necessarily includes contact with a wide range of mathematical techniques statistics, probability, algebra, calculus, linear programming, arithmetic, and so forth. Cycles of production Planning, analysis, and control