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Production Activity Control
Chapter 6
“The time comes when plans must
be put into action”
◼ Responsible for executing the:
◼ Master Production Schedule (MPS)
◼ Materials Requirements Plan (MRP)
◼ At the same time:
◼ Make good use of labor, machines and
materials
◼ Minimize work-in-process inventory
◼ Maintain customer service
Introduction to Materials Management, 7th Edition © 2012, 2008, 2004, 2001, 1998, 1996 Pearson Education, Upper Saddle River, NJ 07458.
Arnold, Chapman and Clive All Rights Reserved.
◼ The material requirements plan authorizes PAC:
◼ Release work orders
◼ Control work orders to complete on time
◼ Control the flow of work
◼ Through manufacturing
◼ Carrying out the plan to completion
◼ Manage day-to-day activity and provide support
Production
Planning
Master
Planning Production
Scheduling
Material
Requirements
Planning
Input/
Implement Output
and Production Control
Control Purchasing Activity
Control
Operation
Figure 6.1 Sequencing
Priority planning and production activity control
Planning
◼ To meet delivery dates

◼ Ensure:
◼ The required materials, tooling, personnel
and information
◼ Schedule:
◼ Start and completion times for each shop
order
◼ Develop load profiles for the work centres`
Implementation
◼ Gather information needed to make the
product
◼ Release orders to the shop floor
◼ MRP authorized
“Dispatching”
Control
◼ The production order has been released
◼ Is corrective action necessary?
◼ Rank the orders by priority
◼ Establish a dispatch list
◼ Track performance to planned schedule
◼ Replan, reschedule, adjust capacity
◼ Monitor and control WIP, lead times, cues
◼ Report work center effciency, scrap, times
PRODUCTION ACTIVITY CONTROL
PLAN
Schedule
Replan
EXECUTE CONTROL
Work Compare
Authorization Decide
Dispatch Feedback
MANUFACTURING OPERATIONS
Figure 6.2 Production control system
Manufacturing Systems
◼ Flow manufacturing
◼ Intermittent manufacturing
◼ Project manufacturing
Flow Manufacturing
◼ High volume
◼ Standard products
◼ Repetitive /cars
◼ Continuous/gasoline
Flow Manufacturing
◼ Routings are fixed
◼ Work centers arranged according to the
routing
◼ Dedicated to a limited range of products
◼ specifically designed equipment
◼ Use of mechanical transfer devices
◼ Low WIP and throughput times
◼ Capacity is fixed by the line
Flow Manufacturing
◼ Production Activity Control
◼ Plans the flow of work
◼ Planned schedule of materials to the line
◼ Implementation and control are relatively
simple
Intermittent Manufacturing
◼ In the intermittent production system,
goods are produced based on customer's
orders. These goods are produced on a
small scale.
◼ Many variations in:
◼ product design
◼ process requirements
◼ order quantities
◼ Flow of work is varied - work flow not
balanced
◼ Machinery and workers must be flexible
◼ Usually grouped according to function
◼ Throughput times are generally long
◼ Capacity required depends on product
mix
◼ Production Activity Control is complex:
◼ number of products made
◼ variety of routings
◼ scheduling problems
◼ PAC is a major activity
◼ Controlled through shop orders for each
batch
Intermittent production system.
Project Manufacturing
◼ One or a small number of units
◼ Usually in one place
◼ Close coordination between:
◼ Manufacturing, Marketing, Purchasing,
Engineering
◼ Examples:
◼ Shipbuilding
◼ House construction
Data Requirements
◼ Need to know:
◼ What and how much to produce
◼ When parts are needed
◼ What operations and times are required
◼ Work center capacities
◼ Organized into databases:
◼ Planning or Control
Planning Files
◼ Item master file
◼ Product structure file
◼ Routing file
◼ Work center master file
Item Master File
◼ Part number ◼ Quantity on hand
◼ Part description ◼ Quantity available

◼ Allocated quantity
◼ Manufacturing lead
◼ already assigned to
time other work orders
◼ Lot size quantity ◼ On-order quantities
Product Structure File
◼ Bill of material file
◼ A listing of single-level components to
make an assembly
◼ Forms a basis for a ‘pick list’
Routing File
◼ Step-by-step instructions on how to
make the product
◼ Operations and their sequence
◼ Operation descriptions (brief)
◼ Equipment tools and accessories
◼ Operation setup times
◼ Operation run times
◼ Lead times for each operation
Work Center Master File
◼ Details on each work center
◼ Work center number
◼ Capacity
◼ Shifts, machine hours and labor hours per
week
◼ Efficiency
◼ Utilization
◼ Average queue time
◼ Alternative work centers
Control Files
◼ Shop order master file
◼ Summarized data on each shop order
◼ Shop order detail file

◼ Current record of each operation
Shop Order Master File
◼ Shop order number ◼ Due date
◼ Order quantity ◼ Priority
◼ Quantity completed ◼ Balance due
◼ Quantity scrapped ◼ Cost information
◼ Quantity of material
issued to the order
Shop Order Detail File
◼ Operation number
◼ Setup hours planned and actual
◼ Run hours planned and actual
◼ Quantity complete (at this operation)
◼ Quantity scrapped (at this operation)
◼ Lead time remaining
Order Preparation
◼ A check for available:
◼ Tooling
◼ Materials
◼ Capacity - when it is needed
Scheduling
◼ To meet delivery dates
◼ Make the best use of resources
◼ Need information on:
◼ Routing
◼ Capacity
◼ Competing jobs
◼ manufacturing lead times
Manufacturing Lead Time
◼ Queue - time spent waiting before
operation
◼ Setup - time to prepare the work center
◼ Run - time to make the product
◼ Wait - time spent after the operation
◼ Move - transit time between work
centers
Manufacturing Lead Time
Queue Setup Run Wait
Move Need a lift truck here
Queue Setup Run Wait Move
Cycle Time
◼ “The length of time from when material
enters a production facility until it exits”
◼ APICS Dictionary 12th Edition
◼ Synonym - throughput time
Example Problem
◼ An order for 100 of a product is processed on work
centers A and B. The setup time on A is 30 minutes,
and run time is 10 minutes per piece. The setup time
on B is 50 minutes, and the run time is 5 minutes per
piece. Wait time between the two operations is 4
hours. The move time between A and B is 10
minutes. Wait time after operation B is 4 hours, and
the move time into stores is 15 minutes. There is no
queue at either workstation. Calculate the total
manufacturing lead time for the order.
Example Problem
Work Center A operation time = 30 + (100 x 10) = 1030 minutes
Wait time = 240 minutes
Move time from A to B = 10 minutes
Work Center B operation time = 50 + (100 x 5) = 550 minutes
Wait time = 240 minutes
Move time from B to stores = 15 minutes
Total manufacturing lead time = 2085minutes
= 34 hours, 45 minutes
Scheduling Techniques
◼ Forward Scheduling ◼ Backward Scheduling
◼ Start when the order ◼ Uses MRP logic
is received ◼ Schedule last
◼ May finish early operation to be
◼ Used to determine complete on the due
the earliest date
completion date ◼ Schedule previous
◼ Determine promise operations back from
dates the last operation
◼ Builds inventory ◼ Reduces inventory
Forward and Backward Scheduling:
Infinite Load
Order Received Due Date
1 2 3 4 5 6 7 8 9
Forward Scheduling
Material 1st 2nd 3rd
Ordered Operation Operation Operation
Backward Scheduling

Figure 6.4 Infinite load profile

Infinite loading
• The assumption is made that the

workstations on which operations
1, 2, and 3 are done have capacity
available when required. It does
not consider the existence of other
shop orders competing for capacity
at these work centers as shown in
Figure 6.5
Infinite Load Profile
Capacity Overload
Capacity
Capacity Underload
Figure 6.5 Infinite load profile
Finite loading
assumes there is a defined limit to

available capacity at any workstation. If
there is not enough capacity available at
a workstation because of other shop
orders, the order has to be scheduled in
a different time period. Figure 6.6
illustrates the condition.
Finite Load Profile
Capacity
Smoothed Load
Figure 6.7 Finite load profile

Forward and Backward Scheduling:
Finite Load
Order Recieved Due Date
1 2 3 4 5 6 7 8 9
Forward Scheduling
Backward Scheduling

Figure 6.6 Forward and Backward scheduling: finite load

Example Problem
Backward Scheduling
◼ A company has an order for 50 brand X to be
delivered on day 100
◼ Only one machine is available for each operation
◼ The factory works one 8 hour shift 5 days a week
◼ The parts move in one lot of 50
Part Operation Time

X A 10 5
20 3
B 10 10
A B X Assembly 5
Example Problem Answer
Part A
OP 10 OP 20
X
Assembly
Part B
OP 10
85 90 95 100
Working Days
Operation Overlapping
◼ The next operation is allowed to begin
before the entire lot is completed
◼ Reduces the manufacturing lead time
◼ Order is divided into at least two
transfer lots
Operation A
SU Lot 1 Lot 2
T=Transfer Time
SU Lot 1 Lot 2
Operation B
Operation Overlapping
◼ Costs involved:
◼ Handling costs between work centers
◼ May increase queue and wait for other
orders
◼ Idle time if the second batch doesn’t
arrive in time
EXAMPLE PROBLEM
◼ Refer to the data given in the example
problem in the section on manufacturing lead
time. It is decided to overlap operations A
and B by splitting the lot of 100 into two lots
of 70 and 30. Wait time between A and B and
between B and stores is eliminated. The move
times remain the same. Setup on operation B
cannot start until the first batch arrives.
Calculate the manufacturing lead time. How
much time has been saved?
Answer
Size of the Optimal Transfer
Batch
SUA = Set up time operation A
SUB = Set up time operation B
RTA = Run time per piece operation A
RTB = Run time per piece operation B
QT = Total order size
T1 = size of the first transfer batch
T1 = QT x RTA - SUB T2 = QT - T1
RTA + RTB
Size of the Transfer Batch
◼ If the second operation is slower than the
first make the first transfer batch small
◼ i.e. get the slower machine started early
◼ If the second machine is faster than the first

make the first transfer batch large
◼ i.e. the second machine will be able to catch up
Example Problem
◼ A batch of 100 whatzits is to be run
through 2 operations, A and B. Times
for the operations are as follows:
Example Problem
Operation A
0 30 730 1,000 (Minutes)
30 70 x 10 = 700 30 x 10 = 300
T T Transfer Time
1,010
50 70 x 5 = 350 30x5 = 150
740 790 1140 1290
Operation B
Stores 1300
Operation Splitting
◼ Reduces manufacturing lead time
◼ The order is split into at least two lots
◼ Similar machines are run simultaneously
◼ Setup time is low compared to run time

◼ Operators can run more than one
machine
Operation Splitting
One Machine
SU Run
Two Machine Operation Splitting

SU Run
Reduction in
Lead Time
SU Run
Figure 6.9 Operation splitting

Load Leveling
◼ Load Report
◼ Tells PAC the current and upcoming
load on a work center
◼ Based on standard hours of operation
for each order
Load Report
Work Center: 10 Available Time: 120 Hours per week
Description: Lathes Efficiency: 115%
Number of Machines: 3 Utilization 80%
Rated Capacity: 110 standard hours / wk
Week 18 19 20 21 22 23 Total
Released
80 30 0 0 315
Load 105 100
60 80 130 80 350
Planned Load
Total Load 105 100 140 110 130 80 665
Rated
110 110 110 110 110 110 660
Capacity
(Over) /
Under 5 10 (30) 0 (20) 30 (5)
Capacity
Figure 6.10 Work centre load report

Scheduling Bottlenecks
◼ Some workstations are overloaded and
some are underloaded; mainly in
intermittent manufacturing.
◼ Bottlenecks
◼ “a facility, function, department, or
resource whose capacity is equal to or less
than the demand put upon it.”
Introduction to Materials Management, 7th Edition
APICs Dictionary 12th Edition
© 2012, 2008, 2004, 2001, 1998, 1996 Pearson Education, Upper Saddle River, NJ 07458.
Throughput
◼ The total volume of product passing
through a facility
◼ Bottlenecks control the throughput
◼ Work centers feeding bottlenecks will build
inventory
◼ Work Centers fed by bottlenecks have their
throughput controlled by the bottleneck
Example Problem -
Bottlenecks
◼ Wagon Wheel Assembly - 1200 sets (2) per week
◼ Handle Assembly - 450 per week
◼ Final Assembly - 550 wagons per week
a. What is the capacity of the factory?

b. What limits the throughput of the factory?
c. How many wheel assemblies should be made?
d. What is the utilization of the wheel assembly?
e. What happens if utilization is 100%
Example Problem -
Bottlenecks
Wagon:
Body
Wheel sets (2)
Handle
Example Problem -
Bottlenecks
a. 450 units per week
b. Throughput is limited by the handle
assembly operation
c. 900 wheel assemblies per week
d. Utilization of the wheel assemblies =
900 ÷ 1200 = 75%
e. Excess inventory of wheel assemblies
Bottleneck Principles (7)
1. Utilization of a non-bottleneck resource is not
determined by its potential, but by another constraint
in the system.
2. Utilization of a non-bottleneck 100% of the time does
not produce 100% utilization.
3. The capacity of the system depends on the capacity
of the bottleneck.
4. Time saved at a non-bottleneck saves the system
nothing.
5. Capacity and priority must be considered together.
6. Loads can and should be split.
7. Focus should be on balancing the flow in the shop.
Managing Bottlenecks
1. Establish a time buffer before each
bottleneck.
2. Control the rate of material feeding the
bottleneck.
3. Do everything to provide the bottleneck with
capacity.
4. Adjust loads.
5. Change the schedule.
Back schedule before the bottleneck; forward
schedule after the bottleneck.
Theory of Constraints continued
2. Exploit the constraint. (idle time?)

3. Subordinate everything to the
constraint.
4. Elevate the constraint.
5. Once the constraint is a constraint no-
longer, find the new one and repeat the
steps.
Drum-Buffer-Rope
◼ Drum - pace of production set by the
constraint
◼ Buffer - inventory established before
the constraint
◼ Rope - coordinated release of material
EXAMPLE PROBLEM
◼ Parent X requires 1 each of component Y
and Z. Both Y and Z are processed on work
center 20 which has an available capacity
of 40 hours. The setup time for component
Y is 1 hour and the run time 0.3 hour per
piece. For component Z, setup time is 2
hours and the run time is 0.20 hour per
piece. Calculate the number of Ys and Zs
that can be produced.
Example Problem
◼ To find the constraint we set the load equal to the
capacity and solve for the number of units to produce
that amount of load.
◼ Since the Bill of Material can not change then the
number of each component can be expressed in
terms of the end item.
◼ This first example has the number of Y’s equal to the
number of X’s and the number of Z’s the same as
well.
◼ It would be wasteful to produce more than this ratio.
X
Example Problem Y Z
Work Center 20: Capacity = 40 hours per week

Y: Setup = 1 hour, Run Time = .3 hours per piece
Z: Setup = 2 hours, Run Time = .2 hours per piece
Calculate Ys and Zs
Let x = the number of Y’s and Z’s to produce
TimeY +TimeZ=40 H
1 + 0.3x + 2 + .2x = 40 hours
0.5x = 37 hours
x = 74 (you can produce 74 Y’s and 74 Z’s)
A
B C(2)
Example Problem
Item Setup (hrs) Run Time (hrs/unit)
A 2 .1
B 2 .2
C 1 .3
Work Station 1 makes A’s and B’s; Capacity = 40 hrs/week

Work Station 2 makes C’s; Capacity = 40 hrs/week
Example Problem
The number of B’s should equal the number of
A’s produced and the load in workstation 1
can be expressed as the number of A’s
produced.
2 hrs + .1×A hrs + 2 hrs + .2×A hrs = 40 hrs
.3×A hrs = 36 hrs
A = 120
Workstation 1 has the capacity to make 120 A’s
and 120 B’s
Example Problem
Workstation 2 (there are 2 C’s in every A)
1 hr + 2×.3×A hrs = 40 hrs

.6 A = 39
A = 65
Workstation 2 can support the number of C’s to

make 65 A’s. (130 C’s)
Implementation
◼ Issuing shop orders to manufacturing
◼ Which have a good chance of being
completed on time
◼ Orders which have the:
◼ tooling
◼ material
◼ capacity
Shop Order Information
◼ Order number, ◼ Material Issue
description Tickets
◼ Engineering
◼ Tool Requisitions
Drawings
◼ Bills of Material ◼ Job Tickets
◼ Route Sheets ◼ Move Tickets
Figure 6.12 Review Order
Order Release
Process Check Tooling
and Material
Availability
No
Okay? Resolve
Yes
Check Capacity
Requirements
and Availability
No
Okay? Resolve
or
Yes Reschedule
Release
Order
Control
◼ Control the work going into and out of a
work center: Input/output control
◼ Set the priority of orders to run at each

work center
Input / Output Control
Input Rate
Control
Queue
(Load, WIP)
Output Rate
Control
Figure 6.13
Input/output control
Work Center: 201
Capacity per period: 40 standard hours
Period 1 2 3 4 5 Total
Planned Input 38 32 36 40 44 190
Actual Input 34 32 32 42 40 180
Cumulative Variance -4 -4 -8 -6 -10 -10
Planned Output 40 40 40 40 40 200

Actual Output 32 36 44 44 36 192
Planned Backlog 32 30 22 18 18 22
Actual Backlog 32 34 30 18 16 20
Figure 6.14 Input/output report

Cumulative Variance
◼ The difference between the total planned for a
given period and the actual total for that period
◼ Cumulative variance
= previous cumul variance + actual - planned
Work Center: 201
Capacity per period: 40 standard hours
Period 1 2 3 4 5 Total
Planned Input 38 32 36 40 44 190
Actual Input 34 32 32 42 40 180
Planned Output 40 40 40 40 40 200

Actual Output 32 36 44 44 36 192
Planned Backlog 32 30 22 18 18 22
Actual Backlog 32 34 30 18 16 20
Cumulative variance week 3 = -4 + 32 -36 = -8
Figure 6.14 Input/output report

Example Problem:
Input/Output
Week 1 2
Planned Input 45 40
Actual Input 42 46
Cumulative Variance
Planned Output 40 40
Actual Output 42 44
Cumulative Variance
Planned Backlog 30
Actual Backlog 30
Operations Sequencing
◼ “a technique for short term planning of actual
jobs to be run in each work center based on
capacities and priorities.”
APICS Dictionary 12th Edition
◼ Priority: The sequence in which jobs should run at a

work center
Dispatching
◼ Selecting and sequencing jobs to be run
at a work center
◼ Dispatch list
◼ Plant, department, work center
◼ Part number, shop order number, operation
number and description
◼ Standard hours
◼ Priority information
◼ Jobs coming to the work center
Dispatching Rules
◼ FCFS - First come, first served
◼ EDD - Earliest job due date
◼ ODD - Earliest operation due date
◼ SPT - Shortest processing time
◼ CR - Critical ratio
Critical Ratio
CR= due date - present date CR<1 Behind
lead time remaining Schedule
CR=1 On Schedule
= actual time remaining
lead time remaining CR>1 Ahead of
Schedule
CR<0 Already late
Sequencing Rules
Process Sequencing Rule
Arrival Due Operation
Job Time
Date Date Due Date FCFS EDD ODD SPT
(days)
A 4 223 245 233 2 4 1 3
B 1 224 242 239 3 2 2 1
C 5 231 240 240 4 1 3 4
D 2 219 243 243 1 3 4 2
Figure 6.16 Application of sequencing rules
Production Reporting
◼ Feedback of what is actually happening on
the shop floor
◼ Needed for management decisions
on-hand on-order
job status shortages
scrap material shortages
Summary
◼ Converting MRP plans into action
◼ Reporting results
◼ Revising plans
◼ Need:
◼ detailed and current schedules and priorities
◼ Results:
◼ on-time deliveries, well utilized labor, and
equipment, minimum inventory levels

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Production Activity Control

◼ Control work orders to complete on time

◼ Control the flow of work

◼ Carrying out the plan to completion

◼ Manage day-to-day activity and provide support

◼ To meet delivery dates

◼ Part description ◼ Quantity available

◼ Shop order detail file

Move Need a lift truck here

Queue Setup Run Wait Move

◼ Synonym - throughput time

Material 1st 2nd 3rd

Figure 6.4 Infinite load profile

• The assumption is made that the

assumes there is a defined limit to

Figure 6.7 Finite load profile

Material 1st 2nd 3rd

Figure 6.6 Forward and Backward scheduling: finite load

Part Operation Time

◼ If the second machine is faster than the first

50 70 x 5 = 350 30x5 = 150

740 790 1140 1290

◼ Setup time is low compared to run time

Two Machine Operation Splitting

Figure 6.9 Operation splitting

Figure 6.10 Work centre load report

◼ Final Assembly - 550 wagons per week

a. What is the capacity of the factory?

2. Exploit the constraint. (idle time?)

Work Center 20: Capacity = 40 hours per week

Work Station 1 makes A’s and B’s; Capacity = 40 hrs/week

1 hr + 2×.3×A hrs = 40 hrs

Workstation 2 can support the number of C’s to

◼ Bills of Material ◼ Job Tickets

◼ Route Sheets ◼ Move Tickets

◼ Set the priority of orders to run at each

Planned Output 40 40 40 40 40 200

Figure 6.14 Input/output report

Planned Output 40 40 40 40 40 200

Cumulative variance week 3 = -4 + 32 -36 = -8

Figure 6.14 Input/output report

◼ Priority: The sequence in which jobs should run at a

CR<0 Already late

Figure 6.16 Application of sequencing rules

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