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Push and Pull Systems: Lecture 12

• MRP and push systems

• Kanban and CONWIP

• Push and pull

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MRP and Push Systems

• Demands for chairs are given as follows

Week 1 2 3 4 5 6

chair 200 0 250 220 300 500

• How do we schedule the production, given its BOM? chair

4 legsframe seat

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Information

Part Chair Leg Seat Frame On-hand 340 900 300 500Leadtime 2 1 1 2

Lot size L4L 800 400 400

Safety stock 50 200 50 100

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MRP Mechanism

week 1 2 3 4 5 6

Chair (340) 200 0 250 220 300 500

Net demand 110 220 300 500

Leg (900) 440 880 1200 2000

order 800 1020 2000

Seat (300) 110 220 300 500

order 400 480

Frame (400) 110 220 300 500

order 400 400

Netting demands Offsetting leadtimes

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MRP Record for the Leg

week 1 2 3 4 5 6 7 8

Gross Requirements 440 880 1200 2000 800 1200 1880 360

Scheduled. Receipt Project balance

(900)460 380 200 200 200 200 200 440

Planned order release

800 1020 2000 800 1200 1880 800

MRP record for the Leg

LS = 800, LT = 1 week, SS = 200

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MRP Record for the Seat

week 1 2 3 4 5 6 7 8

Gross Requirements 110 220 300 500 200 300 470 90

Scheduled. Receipt Project balance

(300)190 370 70 50 250 350 280 190

Planned order release

400 480 400 400 400

MRP record for the Seat

LS = 400, LT = 1 weeks, SS = 50

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MRP Record for the Frame

week 1 2 3 4 5 6 7 8

Gross Requirements 110 220 300 500 200 300 470 90

Scheduled. Receipt 400Project balance

(100)390 170 270 170 370 470 400 310

Planned order release

400 400 400 400 400

MRP record for the Frame

LS = 400, LT = 2 weeks, SS = 100

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MRP Terms• Gross requirement is the anticipated future usage

during a period

• Scheduled receipt is order placed before and will arrive at the beginning of a period

• Projected available balance is the inventory status at the end  of a period

• Planned order release is order to be released at the beginning of a period

• Net demand of the end product is the amount that should be available at the beginning of the period

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Connecting Records• Now that each frame needs 4 rivets to put

together. For rivets, leadtime= 1 wk, safety stock = 400, lot size = 1600. Current on-hand is 412

chair

4 legsframe seat

rivet (4)

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frame/week 1 2 3 4 5 6 7 8

Gross Requirements 110 220 300 500 200 300 470 90

Scheduled. Receipt 400Project balance

(100)390 170 270 170 370 470 400 310

Planned order release

400 400 400 400 400

Gross Requirements

Scheduled. Receipt 1600

Balance (412)

Planned order release

MRP record for rivet

LS=1600, LT=1, SS=400

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Rolling-Horizon: Week 1

week 1 2 3 4 5 6 7 8 9 10 11

1 25 36 27 25 26 28 30 25

2

3

4

5

6

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At the Beginning of Week 2

week 1 2 3 4 5 6 7 8 9 10 11

1 25 36 27 25 26 28 30 25

2 36 27 25 26 28 30 25 23

3

4

5

6

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At the Beginning of Week 3

week 1 2 3 4 5 6 7 8 9 10 11

1 25 36 27 25 26 28 30 25

2 36 27 25 26 28 30 25 23

3 27 30 28 30 31 28 28 28

4

5

6

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At the Beginning of Week 4

week 1 2 3 4 5 6 7 8 9 10 11

1 25 36 27 25 26 28 30 25

2 36 27 25 26 28 30 25 23

3 27 30 28 30 31 28 28 28

4 30 30 30 30 31 28 28 28

5

6

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Exercise 1• Fill the following MRP table

week .

Part A 1 2 3 4 5 6 .

Gross req.5 15 18 8 12 22

Scheduled rec. .

Project availablebalance (21) .Planned order release .Q=20; LT=1; SS=0

During week 1, the following occur: find 12 additional units in inventory;actual requirement is 15 units; wk 3 and wk 4 requirements reduced to 16and increased to 14, respectively; wk 7 requirement is 15

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Exercise 1 Continues• Fill the following MRP table

week .

Part A 2 3 4 5 6 7 .

Gross req. .

Scheduled rec. .

Project availablebalance ( ) .Planned order release .Q=20; LT=1; SS=0

During week 1, the following occur: find 12 additional units in inventory;actual requirement is 15 units; wk 3 and wk 4 requirements reduced to 16and increased to 14, respectively; wk 7 requirement is 15

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MRP Based Control

FG

Partsmachine buffer demand

Planned orders

Forecast demandgenerate time phased plans

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Push Production Systems

• Forecast or anticipate demand• Translate forecasts into production plan• Convert production plan into schedules of lower

level components in a top-down fashion• Executing schedules in a bottom-up fashion

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Comments on MRP• MRP started a new way for factory management and

is one of the most important manufacturing management paradigms

• MRP process can be easily computerized, this led to the earliest MRP system by an IBM team led by Orlicky

• MRP was the first major industry application of computer and has been the core (engine) of the information backbone systems

• MRP logic is flawed. The fundamental weakness is the constant leadtime assumption, which amounts to the assumption of infinite processing capacity and no uncertainty in the system

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MRPII: A Push Planning Framework

Resourceplanning

Rough-cutcapacityplanning

capacity requirementplanning

Finite loading

Input/outputanalysis

Shop-floorsystems

Vendorsystems

MRP

MPS

Production

planning

Demand

management

BOM. Routing

InventoryStatus

Low level planning

Execution

Figure 1

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Kanban and CONWIP

• Toyota production system– Continuous improvement– Smooth production– Eliminate wastes

• How do we create a smooth (stable) production flow so that production matches demand and wastes in production process are minimized?

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Card Count in CONWIP• Stable line speed and WIP level • Characterize the line with

- Practical production rate, RP

- Minimum practical leadtime, TP

• By Little’s law, the CONWIP level IC is

IC= RPTP (2)

• TP includes all (reasonable) detractors include setups, failures, etc.

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Kanban Versus CONWIP

• CONWIP– MPS generates a backlog in front of a line– backlog can be sequenced– a card releases the first job to the line– requires a stable volume but can tolerate

more of the product mix changes-- shifting bottleneck

• Kanban– card for each station and part number– requires a stable product mix and volume

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Variations of CONWIP

• Tandem CONWIP: a long line separated to two or more sections

• CONWIP with shared resource: two CONWIP controlled lines share a common machine

• Pull from bottleneck: for a line with a stable bottleneck, control only the upstream section from the bottleneck

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Push and Pull

• Push: schedules the release of works based on (forecasted) external demands

• Pull: authorizes the release of work based on system status

demandsPush

Pull

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CONWIP and MRP: Observability

• Control throughput and observe WIP

demand --- throughput

fluctuation --- congestion• Control WIP and observe throughput• Observability

- WIP is easy to observe and easy to control

- TH is tied with capacity, when effective capacity changes, it is hard to control

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CONWIP and MRP: Efficiency

• For a given level of throughput, a push system will have more WIP than an equivalent CONWIP

• A CONWIP system can be modeled as a closed queueing network in which the number of customers is a constant

• A MRP control system can be approximately seen as an open queueing network in which each machine has fixed workload

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Efficiency Example• A line with 5 identical exponential single-machine

stations with µ=1 job/hour

• For CONWIP control with a fixed w (WIP):

Throughput rate TH = w µ /(5/µ+ w – 1)=w/(4+w)

• For MRP, no control after release. The line behaves like 5 independent stations

ρ = TH/ µ for every station

• The total

)1/()1/()( THTHTHWIPi

wwTHTHWIP 25.14/5)1(/5

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Hierarchical Planning in a Pull System

PersonnelPlan

FORECASTING

CAPACITY/FACILITYPLANNING

WORKFORCE PLANNING

MarketingParameters

Product/ProcessParameters

LaborPolicies

CapacityPlan

AGGREGATEPLANNING

AggregatePlan Strategy

WorkSchedule

WIP/QUOTASETTING

DEMANDMANAGEMENT

SEQUENCING & SCHEDULING

CustomerDemands

MasterProductionSchedule

SHOP FLOORCONTROL

WIPPosition Tactics

REAL-TIMESIMULATION

PRODUCTIONTRACKING

WorkForecast

Control

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Push and Pull in Supply Chains• Extend the idea of pull beyond production

control to supply chain: produce or make product available only when demand is received

• Make-to-order instead of make-to-stock• The overall leadtime is often too long under

the current competitive environment• Assemble-to-order make-to-stock for

some upstream supply chain and make-to-order for the lower stream supply chain

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Item 1

Assembly(pull/push)

InboundLogistics

(pull/push)

Item n

delivery

supplierssupermarket

Mixed Layout in Supermarket Manufacturing

  

A Hybrid Push-Pull System

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Today’s Takeaways

• MRP is an important manufacturing paradigm and provides the basis for push systems

• Kanban and CONWIP are pull control with a theoretical basis in queueing theory, i.e., equations (1) and (2)

• Push schedule job release while pull control the workload, and is more efficient and robust

• MRP is easily computerized