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Do.Dr.BlentSezen,1,FundamentalsoftheTheoryofConstraints,Do.Dr.BlentSezen,Do.Dr.BlentSezen,2,Introduction,Inrecentyearsaratheruniqueandinterestingapproachtovisualizingandmanaginganoperationhasemerged.OriginallydevelopedbyEliyahuM.GoldrattinhisbookTheGoal,thisTheoryofConstraintshasallowedmanypeopletosuccessfullyrethinktheirapproachestoimprovingandmanagingtheirproductionprocesses.,Do.Dr.BlentSezen,3,Introduction,OpinionsabouttheTheoryofConstraintsdiffer.SomethinkthattheTheoryofConstraints(TOC)isagoodwaytoimproveprocesscapabilitywhileusingothercontrolsystemssuchasJlTorMRP,whileothersbelievethatTOCisastand-aloneapproachcompletelyuniqueandseparatefromothertechniques.Inthiscontext,itissuggestedthatTOCcanprovideapproachestodesign,manage,schedule,andimprovevirtuallyanyproductionsystem.,Do.Dr.BlentSezen,4,Introduction,Stillothersbelieveitcanbeeitherjustaprocessimprovementapproachoracompletesystemapproach,dependingontheextentoftheimplementationtaken.Itmaynot,intheopinionofthisthirdgroup,bethemostappropriateapproachforcertainbusinessenvironments,whileitmayprovehighlyeffectiveforotherbusinessenvironments.,Do.Dr.BlentSezen,5,FundamentalPrinciplesoftheTheoryOfConstraints,ThefundamentalconceptbehindtheTOCisthateveryoperationproducingaproductorserviceisprimarilyaseriesoflinkedprocesses.Eachprocesshasaspecificcapacitytoproducethegivendefinedoutputfortheoperation,andthatinvirtuallyeverycasethereisoneprocessthatlimitsorconstrainsthethroughputfromtheentireoperation.,Do.Dr.BlentSezen,6,TheLinkedProcessPipeAnalogy,Do.Dr.BlentSezen,7,FundamentalPrinciplesoftheTheoryOfConstraints,Theanalogyoftenusedisthatproductionflowingthroughoperationalprocessesislikeliquidflowingthroughapipeline.Eachprocesshasacertaindefinedcapacity,illustratedintheanalogybythediameteroftheassociatedpipe.Inthediagramshown,processEhasthelargestcapacitytoprocessproduction,whileoperationChastheleastamountofcapacity.,Do.Dr.BlentSezen,8,FundamentalPrinciplesoftheTheoryOfConstraints,SinceoperationCistheconstraintontheentireprocess,itwilllimittheamountofoutputfromtheprocess,regardlessofthecapacityoftheremainingprocesses.Improvinganyoftheotheroperations(increasingthesizeofthepipeinthatsection)willnotimprovethetotalamountofliquidcomingoutofthesystemofpipes.,Do.Dr.BlentSezen,9,FundamentalPrinciplesoftheTheoryOfConstraints,Aconstraint,initsmostgeneralform,isanythingthatlimitsthefirmfrommeetingitsgoal.Formostfirms,thatgoalistomakemoney,whichmanifestsitselfbyincreasingthroughput-asmeasuredbysales,notjustproduction.,Do.Dr.BlentSezen,10,FundamentalPrinciplesoftheTheoryOfConstraints,Asanumericalexample,considertheoperationproducingproductAinFigure.,Do.Dr.BlentSezen,11,FundamentalPrinciplesoftheTheoryOfConstraints,Itshouldbeclearfromthissimpleexamplethatthetotaloperationisconstrainedbyprocess3at4perhour.Nomatterhowmuchefficiencyyouhaveintheotherprocessesandhowmanyprocessimprovementsaremadeinprocesses1,2,and4,youwillneverbeabletoexceedtheoveralloperationaloutputof4perhourunlessyouaddresstheconstraintsofprocess3.,Do.Dr.BlentSezen,12,FundamentalPrinciplesoftheTheoryOfConstraints,Increasedefficiencyandutilizationinprocesses1and2will,infact,onlyincreaseinventory-notsales.ThatissueisoneofthekeypointsofTOC-themajormeasureforanyoperationshouldbeonthethroughputoftheorganization,or,inotherwords,thecontributiontosales.Anyothermeasuresofprocessefficiency,utilization,orothercommonlyusedoperationalmeasureshavelittlerelevancetotheoveralleffectivenessoftheentiresystem.,Do.Dr.BlentSezen,13,FundamentalPrinciplesoftheTheoryOfConstraints,Thisapproachhasimplicationsfarbeyondhowtheprocessisviewed.Evenaccountingsystemsareimpacted.Forexample,manyaccountingsystemsallocateoverheadcoststoproductsbasedondirectlaborhoursofproduction.Suchsystemsmaygivetheimpressionthatproducingmoreproductwillhelptopayfortheoverheadcosts.Unfortunately,iftheextraproductproducedisnotlinkedtoactualsales,theresultisonlymorecostlyinventoryandanoverallnegativeimpactonthebusiness.,Do.Dr.BlentSezen,14,FundamentalPrinciplesoftheTheoryOfConstraints,TOCprinciplesmakethepointthatonlysalesshouldbecountedasoperationalthroughput.Anotheraccountingimplicationisthelaborcostitself.MosttraditionalaccountingsystemsviewdirectIaborasavariablecost.TOCprinciples,ontheotherhand,contendthatintheshortrunalloperationalcostsexceptdirectmaterialarelargelyfixedandshould,therefore,belumpedtogetherintoanoveralloperationalexpense.,Do.Dr.BlentSezen,15,FundamentalPrinciplesoftheTheoryOfConstraints,Oneofthekeypointsmadebythisexampleisthatproductsdonotreallyhaveaprofit-companiesdo.Thispointhelpstoviewtheoperationmoreasasystemratherthanasasetoflargelyindependentfunctions.SuchaviewisacriticalpartofmanagingbyTOCprinciples.,Do.Dr.BlentSezen,16,UnderstandingandManagingTheConstraints,ThereareseveralfundamentalguidelinesdevelopedforunderstandingtheTOCprinciplesandhowtomanageaconstrainingprocess.Someofthemorenoteworthyguidelinesincludethefollowing:,Do.Dr.BlentSezen,17,UnderstandingandManagingTheConstraints,AsystemoptimalperformanceisNOTthesumoflocaloptima.Anysystemthatisperformingaswellaspossibleusuallyimpliesthatnotmorethanonepartofthesystemisperformingatanoptimallevel.,Do.Dr.BlentSezen,18,AsystemoptimalperformanceisNOTthesumoflocaloptima.,Ifallpartsofthesystemareperformingoptimally,thesystemasawholewillprobablynotbeperformingoptimally.Inotherwords,itisvirtuallyimpossibletoobtainaperfectsystembalance.Evenifthesystemwasdesignedtobeperfectlybalanced,normalvariationsinperformancewillinevitablycausesomedegreeofimbalance.,Do.Dr.BlentSezen,19,UnderstandingandManagingTheConstraints,Systemsarelikechains.Eachsystemwillhaveaweakestlink(aconstraint)thatwilllimittheperformanceofthewholesystem.,Do.Dr.BlentSezen,20,UnderstandingandManagingTheConstraints,Knowingwhattochangerequiresacompleteunderstandingofthesystemandthesystemgoal.OfteninTOC,thesystemgoalistomakemoneythroughsales,notproduction.Productioncompletedwithoutasale(makingandstoringinventory)doesnotcontributetothegoalofthecompanyuntilitdoesbecomeasale.,Do.Dr.BlentSezen,21,UnderstandingandManagingTheConstraints,Mostundesirablesystemeffectsarecausedbyafewcoreproblems.Solvingasymptomofaproblemwilloftendolittlegood.Ifthecoreproblemremains,thesymptom(oranotheroneassociatedwithit)willlikelyreappearverysoon.Truelong-termrelieffromtheundesirableeffectwilloccuronlyifthecoreproblemisidentifiedandcorrected.,Do.Dr.BlentSezen,22,UnderstandingandManagingTheConstraints,Coreproblemsarealmostneverobvious.Theytendtoshowthemselvesasaseriesofundesirableeffects,mostofwhicharereallysymptomsoftheunderlyingproblems.,Do.Dr.BlentSezen,23,UnderstandingandManagingTheConstraints,Eliminatingtheundesirableeffectsprovidesafalsesenseofsecurity.Workingonproblems(oftenreallysymptoms)withoutfindingtherootcausetendstoprovideshort-livedimprovements.Ontheotherhand,eliminatingacoreproblemgenerallyeliminatesalloftheundesirableeffectsassociatedwithit.,Do.Dr.BlentSezen,24,UnderstandingandManagingTheConstraints,Systemconstraintscanbeeitherphysicalconstraintsorpolicyconstraints.Policyconstraintsaregenerallymoredifficulttofindandeliminate,buttheeliminationofapolicyconstraintgenerallyprovidesamorepronouncedsystemimprovement.,Do.Dr.BlentSezen,25,UnderstandingandManagingTheConstraints,Ideasarenotsolutions.Generatingideascanbebeneficial,butonlyifthereisfollow-throughtodeveloptheideaintoasolutionandthenimplementitcompletely.,Do.Dr.BlentSezen,26,UnderstandingandManagingTheConstraints,Thefocusshouldbeonbalancingflowthroughtheshop.Thekeyisthroughputthatendupassales,notonthroughputthatmayendupasinventory.Someaccountingsystemspromotehighproductionratesevenifthesalesarelower.,Do.Dr.BlentSezen,27,UnderstandingandManagingTheConstraints,Utilizationofanon-bottleneckisdeterminedbyconstraintsinthesystem.Non-bottleneckoperationsdonotrestrictsystemoutput.Thoseresourcesshould,therefore,bemanagedinsuchawayastoprovidemaximumsupportforconstraintresources.,Do.Dr.BlentSezen,28,UnderstandingandManagingTheConstraints,Utilizationofanoperationisnotthesameasactivation.IntheTOCconcept,anoperationisconsideredactivatedonlywhenitisprovidingbenefitfortheentiresystemtogivemoreoutput.Theoperationmaybeutilized,orproducingmaterialnotneededuntilsometimeinthefuture,butthatdoesnotnecessarilyhelptheentiresystem.,Do.Dr.BlentSezen,29,UnderstandingandManagingTheConstraints,Anhourlostataconstraintoperationisanhourlosttothroughputfortheentireprocess.Itisforthisreasonthatthemajorfocusofmanagingandschedulinganoperationisontheconstraint.,Do.Dr.BlentSezen,30,UnderstandingandManagingTheConstraints,Anhourlostatanon-constraintwillnotimpacttotalthroughput.Itrepresentsinsteadexcesscapacity.,Do.Dr.BlentSezen,31,UnderstandingandManagingTheConstraints,Transferbatchesdonothavetobethesamesizeasprocessbatches,andoftenshouldnotbe.Processbatchesforconstraintsshouldbeofasizethatmaximizetheeffectiveutilizationoftheprocess(minimizedowntime).Processbatchesatnon-constraintsarenotsocritical.Transferbatches(theamountofmaterialmoved),mayoftenbesmallertomaximizethroughputandminimizeprocessinventories.,Do.Dr.BlentSezen,32,UnderstandingandManagingTheConstraints,Ascheduleshouldbedeterminedbyusingalltheoperationalconstraints.Inmanyoperationsschedulesaresetsequentially.TOCarguesthatallconstraintareasshouldbeconsideredatthesametimewhenmakingaschedule.Thetheoryalsoarguesthatleadtimesarearesultofthescheduleandshouldnotbedeterminedbeforetheschedulingprocess.,Do.Dr.BlentSezen,33,ImprovingtheProcessusingTOCPrinciples,IfaTOCapproachisdeemedappropriatetohelpimproveabusinesssystem,thereisafive-stepprocessthatisrecommendedtohelpimprovetheperformanceofthebusiness.,Do.Dr.BlentSezen,34,ImprovingtheProcessusingTOCPrinciples,1.Identifytheconstraint.Thisimpliestheneedtoexaminetheentireprocesstodeterminewhichprocesslimitsthethroughput.Forexample,intheexampleonSlide10,supposethesalesdepartmentwasonlysellingtheproductoutputattherateof3perhour.,Do.Dr.BlentSezen,35,1.Identifytheconstraint.,Inthatcase,thesalesdepartmentwouldbeconsideredtheconstraintandnotprocess3.itmustbekeptinmindthataconstraintlimitsthroughputwithrespecttooverallbusinesssales,notmerelyinventoryproduction.,Do.Dr.BlentSezen,36,ImprovingtheProcessusingTOCPrinciples,2.Exploittheconstraint.Findmethodstomaximizetheutilizationoftheconstrainttowardproductivethroughput.Forexample,inmanyoperationsallprocessesareshutdownduringlunchtimeorduringbreaks.Ifaprocessisaconstraint,theoperationshouldconsiderrotatinglunchperiodssothattheconstraintisneverallowedtobeidle.,Do.Dr.BlentSezen,37,2.Exploittheconstraint.,Suppose,forexample,anoperationhasacertainprocessthatrepresentsaclearandlargeconstraint.Supposealsothattheycurrentlyhave7productivehoursforan8-hourshift(30minutesforlunchandtwo15-minutebreaks).Assumingtheyhavemultipleworkersthatcanoperatetheprocess(orcantrainmore),theycouldstaggerlunchtimesandbreaktimesforjustthatoneprocess,allowingittooperatethefull8hours.,Do.Dr.BlentSezen,38,ImprovingtheProcessusingTOCPrinciples,3.Subordinateeverythingtotheconstraint.Effectiveutilizationoftheconstraintisthemostimportantissue.Everythingelseissecondary.4.Elevatetheconstraint.Essentiallythismeanstofindwaystoincreasetheavailablehoursoftheconstraint,includingaddingmoreofit.,Do.Dr.BlentSezen,39,ImprovingtheProcessusingTOCPrinciples,5.Oncetheconstraintisaconstraintnolonger,findthenewoneandrepeatthesteps.Astheconstrainteffectiveutilizationincreases,itmayceasetobeaconstraintasanotherprocessbecomesone.Inthatcasetheemphasisshiftstothenewprocessconstraint.Itisalsopossiblethatasales-relatedchangeintheproductmixwillcauseadifferentprocesstobecometheconstraint.,Do.Dr.BlentSezen,40,Notesonthefivesteps:,ThethirdstepisaccomplishedbyReleasingmaterialatthegateway(firstprocessing)centerataratethatwillkeeptheconstraintbusy.Prioritizationofnon-constrainttasksbasedalmostexclusivelyonconstraintneeds.,Do.Dr.BlentSezen,41,Notesonthefivesteps:,Theconceptofexploitreallyimpliesgettingthemostfromexistingconstraintresources.TOCsuggeststhatexploitingshouldbemaximizedpriortospendingadditionalmoneytoacquiremoreoftheconstraintresource.,Do.Dr.BlentSezen,42,Notesonthefivesteps:,Thefifthstepisreallyawarningtocontinuallychecktoensuretheconstrainthasnotshifted.Effectiveexploitationofexistingconstraintsandashiftinproductmixareexamplesofeventsthatcancausetheconstrainttoshift.,Do.Dr.BlentSezen,43,Notesonthefivesteps:,Afterunderstandingthesefivesteps,itmaybehelpfultoconsiderthatnotallfacilitiesoperatinginalltypesofbusinessenvironmentsmayfindtheapproachtoTOCeasytoimplement.Forexample,ifanoperationhasahighlyvolatileproductmixduetoconstantlyshiftingcustomerordersforalargevarietyofproducts,theymaydiscoverthattheconstraintwillalsobevolatile.,Do.Dr.BlentSezen,44,Notesonthefivesteps:,Atonetimethemixofprocessrequirementsmaypointtooneconstraint,whileatanothertimethemixmaycreateanentirelydifferentconstraint.Iftheconstraintshiftingoccursfrequently,thentherecouldbefartoolittleopportunitytoapplytheTOCapproachesononeconstraintbeforeitshiftstoanotherpointintheprocess.,Do.Dr.BlentSezen,45,ImpactOnOperationStrategy,Foragiventypeandmixofproducts,managementcanelecttoconsciouslydecidewheretheconstraintshouldbelocatedandthenproceedtodeveloptheoperationalstrategyaroundthatselectedconstraint.MarketingandSalescanbetightlytiedtotheconstraint.Specifically,ananalysiscanbemadetodeterminethemixofproductstoselltomaximizeprofits,andalsoitispossibletosellmoreofproductsthatdonotusetheconstraint(implyingthatexcesscapacityisavailabletomakemoreofthoseproducts).,Do.Dr.BlentSezen,46,ImpactOnOperationStrategy,Engineeringandotherprocessimprovementactivitiescanandshouldbefocusedonmakingtheconstraintprocessmoreefficientandeffective.Thecompanyshouldconsiderifandhowthenon-constraintprocessesmaybeusedtosupplementorbeusedtomaketheconstraintresourcesmoreeffective.,Do.Dr.BlentSezen,47,ImpactOnOperationStrategy,Ifthecompanyhasachoiceastowheretheconstraintislocatedintheprocess,theymayelecttohavetheconstraintearlyintheprocess.Inthatwaythesizeoftherequiredbufferneededtoguardtheconstraintagainststarvationofmaterialwillbeminimized.,Do.Dr.BlentSezen,48,ImpactOnOperationStrategy,If,ontheotherhand,thereareprocessesearlyintheoverallprocessthathavepoorqualityyield,theconstraintshouldbeplacedlaterintheoverallprocess.Someprocesses,especiallycertainchemicalprocesses,havepooryieldbytheirverynature.Theideaistohavethoseprocessesplacedpriortotheconstraint.,Do.Dr.BlentSezen,49,ImpactOnOperationStrategy,Iftheywereplacedaftertheconstraint,thentheimplicationisthatsomeproductthathasalreadybeenthroughtheconstraintwillnotbescrappedorneedreworkusingtheconstraint.SincetheideabehindTOCistohaveallitemsgoingthroughtheconstraintbeturnedintosales,clearlyitisnotagoodideatohaveconstrainttimebeingwastedbybeingusedforaproductthatwilllaterberejected.,Do.Dr.BlentSezen,50,LogisticsandtheTheoryofConstraints,Logisticsdealswiththephysicalmovementofmaterialthroughtheproductionprocess.TheTheoryofConstraintshasspecificissuesdealingwithlogistics,aswellassomemethodstodealwithmakinglogisticalmovementeffective.,Do.Dr.BlentSezen,51,LogisticsandtheTheoryofConstraints,Mostsystemsaremadeupofaseriesofdependentevents,oraseriesofspecificstepsthatmustbefollowedinacorrectordertocompleteajob.Thisimpliesthatanylatenessatanearlystationintheprocesswillpotentiallyimpactnegativelylaterstationsintheprocess.,Do.Dr.BlentSezen,52,LogisticsandtheTheoryofConstraints,Mostactivitieshavestatisticalfluctuationsinherentintheiroperation.Thisimpliesthatactivitytimesarenotdeterministicanddeviationsaboutthemeanwillexist.TheTOCapproachsuggeststhatitisthesestatisticalfluctuationsthatmaketraditionalassemblylinebalancingapproachesimpractical.,Do.Dr.BlentSezen,53,LogisticsandtheTheoryofConstraints,Thereareoftenthreereasonsgivenforalossofthroughput,andthesereasonsarefocusedontheconstraintinthesystem.,Do.Dr.BlentSezen,54,threereasonsforalossofthroughput,1.Theconstraintisbroken.Sincenoexcesscapacityexistsonaconstraint,thelossofcapacitywilldirectlyresultinalossofthroughputfortheentirebusiness.,Do.Dr.BlentSezen,55,1.Theconstraintisbroken.,Onemajorsolutiontothispotentialproblemisagoodprogramofpreventivemaintenance.Suchaprogramneedstobescheduledandmanagedcarefully,forevenpreventivemaintenancerepresentsauseofcapacityfortheconstraint.Ingeneral,thissituationiscompatiblewithabasicprincipleofmaintenancethehigherthecostofanunscheduledbreakdownofaprocess,themorecriticalthefollowingofawell-designedpreventivemaintenanceprogram.,Do.Dr.BlentSezen,56,1.Theconstraintisbroken.,Thisisthesamebasicissuewefoundwithaleanproductionsystem.Withoutmuchinventoryinthesystem,processestendtobetightlylinked,andthelossofanyoperationwillquicklybringtheentiresystemdown.MaintenancebecomesimportantforTOCforroughlythesamereasonasforleanproductionsystems-thepotentialhighcostofadropinthroughputfortheentiresystem.,Do.Dr.BlentSezen,57,threereasonsforalossofthroughput,2.Theconstraintisstarved.Inthiscondition,thereisnoinventoryfromtheprecedingprocessesavailableforworkbytheconstraint.Theconstraintiscapableofproduction,butcannotproducewithoutmaterialtoworkon.Thesolutiontothisproblemisusingabufferinfrontoftheconstraint.Thebufferisinventoryreleasedearlyintothesystem.,Do.Dr.BlentSezen,58,threereasonsforalossofthroughput,3.Theconstraintisblocked.Inthiscondition,theconstraintisavailableandthereismaterialavailableonwhichtowork,butthereisnophysicalspaceinwhichtoplacethecompletedunits.Thesolutiontothispotentialproblemistohaveaspacebufferavailableaftertheconstraintintheprocessinwhichtoplaceproductioncompletedbytheconstraintoperation.,Do.Dr.BlentSezen,59,SchedulingandtheTheoryofConstraints,TheschedulingsystemdevelopedfortheTheoryofConstraintshasitsownspecificapproach,althoughfairlycloselyrelatedtoapullsysteminherentwithleanproduction.Itisoftendescribedasdrum-buffer-rope.,Do.Dr.BlentSezen,60,SchedulingandtheTheoryofConstraints,DrumThedrumofthesystemreferstothedrumbeatorpaceofproduction.Essentially,itrepresentsthemasterschedulefortheoperation,whichisfocusedaroundthepaceofthroughputasdefinedbytheconstraint.,Do.Dr.Ble
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