Chapter 6 - Conclusions

MRP II is not a very effective method of achieving control on the shop floor. The constraints and limitations that cause this can broadly be divided into seven categories as summarized in the table 1:

Table 1: The Limitations and constraints of MRP II as a tool for shop floor control

Limitation and Constraint	Functional Requirement (FR)	Design Parameter (DP)
Quality	1. Eliminate machine assignable causes 2. Ensure operator human errors do not transfer to defects 3. Eliminate material assignable causes 4. Improve capability of process	1. Selection / maintenance of equipment. 2. Mistake proof operations (Poka-Yoke) 3. Supplier quality program 4. Design of experiments to check for poor capability
Identifying and Resolving Problems	1. Identify disruptions where they occur. 2. Identify disruptions when they occur. 3. Identify nature of disruption 4. Minimize delay in contacting correct support resources. 5. Supply descriptive information to support resources. 6. Solve problems immediately	1. Simplified material flow paths. 2. Increased operator’s sampling rate of equipment status. 3. Context sensitive feedback. 4. Rapid Information transfer system 5. System that conveys nature of problem. 6. Standard method to identify and eliminate root cause.
Predictable Output	1. Ensure availability of relevant production information. 2. Do not interrupt production for worker allowances. 3. Ensure material availability.	1. Capable and reliable information system. 2. Mutual Relief system with cross-trained workers. 3. Standard material replenishment system.
Delay Reduction	1. Provide knowledge of demand product mix (part types and quantities) 2. Produce in sufficiently small run sizes. 3. Define takt time. 4. Ensure that production rate is balanced with takt time (rs^max=1/tt^min) 5. Ensure that part arrival rate is balanced with service rate (ra=rs) 6. Reduce lot delay 7. Reduce transportation delay	1. Information flow from downstream customer 2. Design quick changeover for material handling and equipment. 3. Definition or grouping of customers to achieve takt times within an ideal range. 4. Subsystem enabled to meet the desired takt time (design and operation) 5. Arrival of parts at downstream operations according to pitch. 6. Reduction of transportation lot size (single-piece-flow) 7. Material flow oriented layout design.
Direct Labor	1. Eliminate operator’s waiting on machines. 2. Eliminate wasted motion of operators.	1. Human machine separation. 2. Design of workstations / workloops to facilitate operator tasks.
Indirect Labor	1. Eliminate managerial tasks 2. Eliminate information disruptions	1. Self directed work teams (horizontal organization) 2. Seamless Information flow (visual factory)
Facilities Cost	Minimize facilities cost	Reduction of consumed floor space

The interaction of these various issues causes the frequently observed problems of fixed lead time and infinite capacity. From a systems perspective, MRP can be modeled as an open loop system with a non functional feedback arm. Since information flows downstream, in the same direction as the material flow, the actual reality on the shop floor is different from that conveyed by the information system.

This discrepancy gives rise to the large amounts of inventory often seen on the shop floor and an inability to meet the customer demand.

A good shop floor control system is one that has the goal of developing a dynamic and flexible organization. Its design takes into account the structure of the system and the individual work tasks on the shop floor. This introduces a capacity for self design and lasting adaptability that enables the shop floor control module to become an agile entity that can keep pace with ever changing customer demands. MRP II fails in this respect because of its inability to work well with randomness. It normally thrives well in systems characterized by large backlogs, excellent forecasts, highly reliable vendors, large inventories and short material lead times. Unfortunately, this is not the reality in current production environments.

MRP II ‘s problems cannot be solved by carrying out small improvements such as software updates. Instead, it calls for radical steps that address the logic behind the entire system. One solution is the use of hybrid systems that complement the push characteristics of MRP with those of pull systems. Pull systems are particularly effective as control modules in manufacturing systems. In this arrangement, MRP can still be utilized as a planning tool to create demand for the production system.

In the case study provided, company X runs an MRP II system that has little control over the shop floor. The system is characterized by large inventories, long delays and an inability to keep up with customer demands using the inventories on the shop floor. Company X nevertheless has an excellent infrastructure for distributing its products and receiving orders. Several of its problems can be solved by shifting its manufacturing system to ‘lean’. Using already existing product families of centrifuges, company X can establish cells based on the Tandem Push-Pull hybrid system or the Requirement Driven Kanban system suggested by Karmakar.

The design of a Kanban controlled cell at company X is a potential area for subsequent study. This would involve the design of a cell using the existing machinery to establish a cell cycle time that keeps pace with the customer demand. A second area that needs further study is the value stream mapping for a single centrifuge. This would involve tracking the process of putting together one centrifuge from all its 200 different components (this study looked at only one such component). These two areas would provide the foundation for converting company X’s system to lean. Subsequent improvements would address issues such as the size of inventory, reducing set up time for the different machines, Coordinating production to enable throughput time for all the components to equal the actual processing time.