RULES FOR BOTTLENECK SCHEDULING IN TOC

A proprietary scheduling system for TOC by Goldratt initiated aggressive marketing of software, Optimized Production Technology (OPT). The principles involved in OPT are helpful in handling bottlenecks in the scheduling of the production systems. These rules are as follows:
Rule 1: Balance Flow, not Capacity

Line balancing, which is an example of tradition system, attempts to balance the capacity of each work-station. Work-stations are so designed that their capacity is nearly same and, hence, there is a high utilization factor. OPT, using TOC on the other hand, focuses on balancing the flow within the plant (rather than resources as in line-balancing). This will ensure the identification of bottleneck (on constraint). Once the bottleneck is handled for improvement, the throughput of the system increases. Rule 2: The level of utilization of a non-bottleneck resource is determined not by its own potential but by some other constraint in the system.
To understand this rule, let us consider the four classis relationship of bottleneck and non-bottleneck resources: (i) Type I Relationship

In this relationship, a bottleneck resource (B) feeds work-in-process material (WIP) to a non-bottleneck (N) resource. Let us presume that both resources (B and N) are placed in the middle of an assembly line. Thus, these are followed and preceded by few other resources, which are non-bottleneck (N). Fig.29.5 depicts this relationship:

Type I relationship

For this relationship, despite non-bottleneck resource being faster, cannot deliver faster than the output rate of bottleneck resource, which is B. Thus, the non-bottleneck resource is a starving resource, which is under-utilized. This is also illustrated in Figure 29.2
(ii) Type II Relationship In this relationship, a non-bottleneck resource (N) feeds work-in-process material WIP) to a bottleneck (B) resource.

Type II relationship

For this relationship, the difference between the supply rate of non-bottleneck (N) and bottleneck (B) is the inventory pile-up rate between the non-bottleneck and bottleneck resources (Fig.29.6). The through put is still limited by the capacity of the bottleneck.
(iii) Type III Relationship

In this relationship, a bottleneck and other non-bottleneck resources feed parts to an assembly operation (which is a non-bottleneck).

Type III relationship

For this relationship, the difference between non-bottleneck and bottleneck resource is the inventory pile-up rate. The assembly resource (A) is also under-utilized, as its capacity is faster than that of bottleneck resource.
(iv) Type IV Relationship

In this relationship, both non-bottleneck and the bottleneck resources directly supply in the market.

Type IV relationship

The bottleneck resource, whose rate is lesser than the market demand, is utilized at its 100% capacity. The nonbottleneck resource can be utilized at 100% only when the market demand increases otherwise it will remain under utilized.
Through all the four relationships just discussed, following guidelines emerge:

(a) Utilize bottleneck at 100% capacity.

(b) Under-utilize non-bottleneck to eliminate the inventory pile-up. (c) The level of utilization of non-bottleneck is determined by the capacity of bottleneck and not by its own capacity. In the last (IV) relationship, it is driven by market demand.
(d) Enforcing idle time on non-bottleneck and tolerating a certain level of inventory pile-up should have an optimal trade-off.

(e) Throughput of the plant is limited by the capacity put of the bottleneck resource (which is the constraint). Therefore, these rules suggest that the non-bottleneck should not produce more than the absorption-capacity of bottleneck resources, otherwise there will be an increase in inventory pile-up and the operating expenses. Thus, under-utilization of non-bottleneck is the only prudent strategy. Rule 3 Rule 3: Utilization and activation of a resource are not synonymous or the same thing. Traditionally, activation of resource and utilization of resource are treated as same thing. Goldratt, in his TOC, treats these two issues separately. First, let us understand: what is the difference between utilization and activation? Activation: What we should do is activation. It is the indication of doing the required work. Activation is directed towards effectiveness. It is systems measure of performance or holistic approach. A non-bottleneck machine may be active (producing 100%), yet not doing anything useful beyond the capacity of bottleneck. Utilization: What we can do is utilization. It also includes performing work not needed at a particular time. Utilization is directed towards efficiency. It is a reductionist emasure of performance or mechanistic approach.
Example

Both non-bottleneck and bottleneck operating at 100% efficiency

Let us assume that a non-bottleneck has a capacity of 100 parts per day while a subsequent bottleneck has capacity of 60 parts per day as shown in fig. When both resources work at 100% efficiency, the inventory building-up is (100-60) or 40 parts per day. However, at a global or holistic level, the system (combined) is operating at only 60% efficiency level as throughput is 60 parts per day. Thus, the utilization of non-bottleneck (i.e. 100%) is not same as its activation (i.e. 60%) as it is effective for only 60% of its capacity. Traditionally, activation and utilization have been considered as same. TOC/OPT/Synchronous manufacturing treats these separately.

Therefore, the scheduling of all non-scheduling of all non-bottleneck resources of the manufacturing system should be done on the basis of the constraints of the system (i.e., bottleneck resources). A non-bottleneck resource. However, it cannot remain busy all the time. Scheduling Rules in TOC (Goldratt) 1. Balance the flow, not capacity 2. The level of utilization of a non-bottleneck resource is determined not by its own potential but by some other constraint in the system. 3. Utilization and activation of a resource are not synonymous or the same thing. 4. An hour lost at a bottleneck is an hour lost for the entire system. 5. An hour saved at a non-bottleneck is just a mirage. 6. Bottlenecks govern both throughput and inventory in the system.
7. Transfer batch may not and many times should not be equal to the process batch. 8. A process batch should be variable both along its route and in time.

9. Set the schedule by examining capacity and priority simultaneously and sequentially. Lead times are the result of a schedule and cannot be predetermined. Rule 4 Rule 4: An hour lost at a bottleneck is an hour lost for the entire system. Let us presume that there is sufficient demand for parts in the market. Now, if the bottleneck of the previous example (in Rule 3), is running at 100% capacity and, by chance, it stops for an hour, say, for repair and maintenance. An hour lost on this bottleneck will directly reduce the overall production rate (throughput) by one hour. This will be the case, even if there is enough inventory pile-up before the bottleneck. An hour lost on bottleneck can never be recovered because this machine will never have time to process parts, which would otherwise been made in the lost time. This is due to non-availability of buffer capacity for bottleneck. Therefore, an hour lost on bottleneck is an hour lost for the entire factory. In short, if the bottleneck has lost one hour, the overall impact is: the factory has topped for one hour.
Rule 5 Rule 5: An hour saved at a nonbottleneck is just a mirage.

For a non-bottleneck resource, there is some idle time, during which either this resource is unutilized or producing inventory pile-up. Even in case the working or processing time of this resource is crashed, the overall impact on the system will be zero as far as throughput is concerned. This is because throughput is dictated by the bottleneck resource. Therefore, TOC advocates attack on bottleneck for increasing its efficiency. Let us look at the set-up time, which is needed for setting the tool/machines, etc., for each batch of partprocessing. Traditional system treats set-up time for bottleneck and non-bottleneck resource equally. TOC advocates different approaches. In Table above an example is presented. In this, the bottleneck resource processes one batch of part in 14 time units (hour), while non-bottleneck does it in 12 time units (thus, has 2 units of idle time per batch). Read this table column-wise. The processing of batch of this part first goes to bottleneck, followed by on the nonbottleneck. Originally, due to lesser processing time (PT) on the non-bottleneck, there is an idle time (IT) of 2 hours on non-bottleneck. When, the set-up of bottleneck is squeezed by one hour, the idle time of nonbottleneck reduces by one hour and the system throughput increases due to faster disposal at bottleneck.

However, when the set-up of non-bottleneck is squeezed by one hour, its idle time increases by one hour due to no change at bottleneck resource. Throughput remains same:

Effect of an hour saved on bottleneck or non-bottleneck Thus, an hour saved on non-bottleneck has no impact on the system performance (which is the throughput in this case). Looking at the condition of lower set-up time of non-bottleneck, we find an important observation. Lower set-up time of non-bottleneck can facilitate more numbers of set-ups and, thus, batch-size can be reduced in part processing. The effect of lower batch size means:
(a) Lower build-up inventory

(b) Lower operating expenses (c) No effect on throughput Rule 6 Rule 6: Bottlenecks govern both throughput and inventory in the system. One of the most important reasons to maintain in-process inventory is to keep bottleneck machine busy. There must be no time loss on it. WIP is to ensure continuous feed to bottleneck. Throughput of the system is governed by the bottleneck and an hour lost/saved on it will reduce/increase the system throughput. This feature is already explained in the previous example.
Rule 7

Rule 7: Transfer batch may not and many times should not be equal to the process batch.

Lot size is an important variable, which plays vital role in inventory build-up and throughput. OPT advocates two lot sizes (rather than one, as in traditional system). These are transfer-batch and process-batch. From part point of view, lot size is the transfer batch size. However, from resource point of view, lot size is process batch size. Let us look at the example to follow:
Example

Let us consider an example. Suppose a part requires three operations: milling, drilling and inspection. The processing time for individual part and for one processing-batch of 100 parts is as follows: Operation Milling Drilling Inspection Total Processing Time for one part 0.45 hour 0.35 hour 0.20 hour 1.00 hour Processing Time for one batch of 100 parts 45 hours 35 hours 20 hours 100 hours

Process batch and transfer batch are equal

Process batch is greater than transfer batch

When process-batch is same as transfer-batch, the situation is same as in Fig. Thus, when milling of 100 items is complete, they are transferred to drilling and so on. The total time is 100 hours. If the transfer on milling,

transfer-batch is smaller than process-batch (which is 100), a small batch (say 44 parts, after getting processed on drilling, transferred from milling to drilling after every 20 hours; and 57 parts, after getting processed on drilling, transferred to inspection after every 20 hours of drilling for this batch) may be transferred to next operation on the process-sheet. The situation may be one like shown in Figure. In the modified scenario, there will be a substantial reduction in total busy time of machines and overall increase in the throughput-time. In addition, there will be marked reduction in inventory pile-up and operating expenses. Thus, one process-batch (which is 100 in above example) needs one set-up on machines. However, in each process-batch, there may be more than one transfer to next machines. As shown above, the smaller transfer batch (than process-batch) increases the throughput, reduces inventory pile-up, reduces operating expenses and reduces the total busy time of the resources
Rule 8 Rule 8: A process-batch should be variable both along its own route and in time.

The process-batch at different levels of manufacturing: both route-wise and time-wise, should be different. Traditionally, we follow a fixed batch-size unless exceptional situation occurs. OPT argues against it. In OPT, lot size is a dynamic decision, which should change as per time and situation. It should be decided upon issues such as inventory level, set-up time/cost, material handling, flexibility and agility of the system, uncertainty on the shop-floor as well as in market, etc. It the resource is non-bottleneck, we can afford to have smaller processbatch; but if the resource is bottleneck, we should go for larger process-batch.
Rule 9

Rule 9: Set the schedule by examining capacity and priority simultaneously, not sequentially. Lead times are the result of a schedule and cannot be preterminated. In a tradition system (such as, MRP), the lead time is fixed and predetermined. However, OPT advocates that scheduling must recognize that lead time is not necessarily a fixed quantity. It may vary as a function of schedule. The schedule should be set by examining the capacity and priority simultaneously. Email Based Homework Assignment Help in Rules for Bottleneck Scheduling In TOC Transtutors is the best place to get answers to all your doubts regarding rules for bottleneck scheduling in toc with examples. You can submit your school, college or university level homework or assignment to us and we will make sure that you get the answers you need which are timely and also cost effective. Our tutors are available round the clock to help you out in any way with industrial management. Live Online Tutor Help for Rules for Bottleneck Scheduling In TOC Transtutors has a vast panel of experienced industrial management tutors who specialize in rules for bottleneck scheduling in toc with examples and can explain the different concepts to you effectively. You can also interact directly with our industrial management tutors for a one to one session and get answers to all your problems in your school, college or university level Industrial management. Our tutors will make sure that you achieve the highest grades for your industrial management assignments. We will make sure that you get the best help possible for exams such as the AP, AS, A level, GCSE, IGCSE, IB, Round Square etc.