The difficulties in responding to variation in product order mixes and load levels effectively in make to order are known. Most of the existing approaches consider releasing jobs to the shop (input control), changing capacity levels (output control) in a controlled way, order acceptance with different definitions of work load and due date assignment. Controlling the processes, routing options and the order accepting capacity with various tool combinations that will decrease tool loading are not considered properly. However the manufacturing flexibility provided by the computer numerically controlled (CNC) machines, provides both part variety and due date achievement given a reasonable extra capacity. Positive effects of flexibility on the due date achievement of the make to order is shown with a variety of experimental and field studies leaving little doubt. However taking flexibility only as a strategic issue and not considering it as a means of planning and management in either the short term or medium term decisions have been commonplace practice. In this study, benefits of providing three kinds of flexibility, considering order pool and acceptance probability of the new arrivals in a periodic setting, is the focal issue. If the required flexible environment is provided, the necessity to make a detailed job loading, route planning and scheduling will be reduced to a low level and a high shop congestion and due date achievement will be realized simultaneously. A typical realistic shop with a scaled part mix is assumed in the flexibility management modeling and simulation experiments are conducted applying periodical flexibility planning approach. These experiments briefly support the ideas that worth of anticipation is more than plain expectations and flexibility improves robustness.

abstract: Today's competitive markets force companies to constantly engage in the complex task of managing their demand. In make-to-order manufacturing or service systems, the demand of a product is shaped by price and lead times, where high price and lead time quotes ensure profitability for supplier, but discourage the customers from placing orders. Low price and lead times, on the other hand, generally result in high demand, but do not necessarily ensure profitability. The price and lead time quotation problem considers the trade-off between offering high and low prices and lead times. The recent practices in make-to- order manufacturing companies reveal the importance of dynamic quotation strategies, under which the prices and lead time quotes flexibly change depending on the status of the system. In this dissertation, the objective is to model a make-to-order manufacturing system and explore various aspects of dynamic quotation strategies such as the behavior of optimal price and lead time decisions, the impact of customer preferences on optimal decisions, the benefits of employing dynamic quotation in comparison to simpler quotation strategies, and the benefits of coordinating price and lead time decisions. I first consider a manufacturer that receives demand from spot purchasers (who are quoted dynamic price and lead times), as well as from contract customers who have agree- ments with the manufacturer with fixed price and lead time terms. I analyze how customer preferences affect the optimal price and lead time decisions, the benefits of dynamic quo- tation, and the optimal mix of spot purchaser and contract customers. These analyses necessitate the computation of expected tardiness of customer orders at the moment cus- tomer enters the system. Hence, in the second part of the dissertation, I develop method- ologies to compute the expected tardiness in multi-class priority queues. For the trivial single class case, a closed formulation is obtained. For the more complex multi-class case, numerical inverse Laplace transformation algorithms are developed. In the last part of the dissertation, I model a decentralized system with two components. Marketing department determines the price quotes with the objective of maximizing revenues, and manufacturing department determines the lead time quotes to minimize lateness costs. I discuss the ben- efits of coordinating price and lead time decisions, and develop an incentivization scheme to reduce the negative impacts of lack of coordination. / Dissertation/Thesis / Ph.D. Industrial Engineering 2012

Empresas de manufatura contratada terão sucesso se conseguirem definir sua estratégia por meio do desenvolvimento de competências operacionais alinhadas aos requisitos do mercado, direcionando decisões e ações que as impulsionem a obterem um melhor desempenho. As incertezas, tanto de produtos como de volumes que serão demandados, envolvidas no relacionamento com as empresas-cliente reduzem a oportunidade de um planejamento antecipado da produção, requerendo, então, uma política de atendimento da demanda do tipo make-to-order (MTO). O grande desafio enfrentado pelas empresas que operam no ambiente MTO é atender à demanda do cliente de forma rápida e confiável, ou seja, respeitando-se os prazos e as quantidades requeridos. O objetivo geral deste trabalho foi analisar como práticas do sistema Lean Manufacturing (LM) poderiam ser efetivamente implementadas em conjunto a um sistema de planejamento e controle da produção (PCP) apropriado, visando ao desenvolvimento de competências operacionais alinhadas à política MTO. Os objetivos específicos do estudo concentraram-se em identificar na literatura as principais competências operacionais requeridas no ambiente MTO, discutir o processo de implementação de práticas do sistema LM e comparar, conceitualmente, sistemas de PCP. A empresa de manufatura contratada escolhida para este estudo representava um caso puro da utilização da política MTO, dada a natureza de seu relacionamento com os clientes. A aplicação da metodologia pesquisa-ação permitiu que o estudo fosse conduzido de forma participativa e com uma abordagem de solução de problemas, além de fornecer um roteiro de referência, relacionando as etapas da pesquisa aos conceitos abordados na literatura. Como resultado, verificou-se que a adoção de práticas do sistema LM auxilia de forma significativa no desenvolvimento de competências operacionais em empresas que operam em ambientes MTO. No entanto, é necessário que estas práticas estejam associadas a um sistema de PCP apropriado - Workload Control (WLC) - para que se obtenham os resultados esperados. / Contract manufacturing companies will succeed if they can define their strategy through the development of operational competencies aligned to market requirements, directing decisions and actions that lead them to have a better performance. The relationship with the hiring firm involves multiple products and demand uncertainty, reducing the opportunities for advanced planning, requiring a make-to-order (MTO) demand management policy. The main challenge faced by companies operating in an MTO environment is to achieve high delivery reliability in terms of order quantities and delivery schedules. The general objective of this study was to analyze how Lean Manufacturing (LM) practices could be effectively implemented together with an appropriate production planning and control system (PPC), aiming to develop operational competences aligned to the MTO policy. The specific objectives of this study include identifying in the literature the main operational competencies required to operate on a MTO basis, discussing the LM implementation process and comparing conceptually PPC systems. The contract manufacturing company chosen for this study operated according to a MTO policy due to the nature of its relationship with the customers. The application of the action research methodology allowed conducting the study in a participative manner, using a problem solving approach and providing a reference guide relating the action research steps to concepts discussed in the literature review. As a result, it was found that the adoption of LM practices contributes substantially to the development of operational competences in companies operating in an MTO environment. However, it is necessary that these practices are associated with an appropriated PPC - Workload Control - to obtain the expected results.

The increasing emphasis on mass customization, shortened product lifecycles, synchronized supply chains, when coupled with advances in information system, is driving most firms towards make-to-order (MTO) operations. Increasing global competition, lower profit margins, and higher customer expectations force the MTO firms to plan its capacity by managing the effective demand. The goal of this research was to maximize the operational profits of a make-to-order operation by selectively accepting incoming customer orders and simultaneously allocating capacity for them at the sales stage. For integrating the two decisions, a Mixed-Integer Linear Program (MILP) was formulated which can aid an operations manager in an MTO environment to select a set of potential customer orders such that all the selected orders are fulfilled by their deadline. The proposed model combines order acceptance/rejection decision with detailed scheduling. Experiments with the formulation indicate that for larger problem sizes, the computational time required to determine an optimal solution is prohibitive. This formulation inherits a block diagonal structure, and can be decomposed into one or more sub-problems (i.e. one sub-problem for each customer order) and a master problem by applying Dantzig-Wolfe’s decomposition principles. To efficiently solve the original MILP, an exact Branch-and-Price algorithm was successfully developed. Various approximation algorithms were developed to further improve the runtime. Experiments conducted unequivocally show the efficiency of these algorithms compared to a commercial optimization solver. The existing literature addresses the static order acceptance problem for a single machine environment having regular capacity with an objective to maximize profits and a penalty for tardiness. This dissertation has solved the order acceptance and capacity planning problem for a job shop environment with multiple resources. Both regular and overtime resources is considered. The Branch-and-Price algorithms developed in this dissertation are faster and can be incorporated in a decision support system which can be used on a daily basis to help make intelligent decisions in a MTO operation.

Purpose – The purpose of this study is to examine the material flow and production effectiveness at a Make to Order companies. To answer the purpose two research questions have been formed; What challenges do MTO companies have regarding throughput? Which tools and standards are suitable to an MTO companies for an increased throughput? Method – The study is based on an abductive approach in which the authors have chosen to use triangulation to answer the purpose of the study. The data collection methods used are literature studies, interviews, observations and document studies. The authors have done a theoretical review in the relevant field in order to gain an insight into the theories that exist in the area concerned. An analysis has then been made based on the empirical data collected and linked to the theoretical framework. Findings – The findings the authors have come up with is that there is no given method or standard for MTO (Make to order) companies to implement. The authors, on the other hand, have come to the conclusion that it is about working with several models and standards parallel in order to have a greater impact on the material flow. It is also important to know what can be standardized and what cannot be standardized if the product variation and customization are high. Implications – This study has the implication of highlighting the challenges that MTO companies can face with a varying degree of customization. The study also highlights the complexity that exists for the material flow at MTO companies. In this study, the authors have developed a model for the case company over how their production layout can be adapted for a higher throughput. Limitations – The limitations found in this study is that it is done with only one case company where data collection has been done for a limited time. The result is therefore adapted to the case company, but a recommendation from the authors is that the study can be validated on similar activities. / Syfte – Syftet med denna studien är att Undersöka materialflödets- och produktionseffektiviteten hos ett MTO-företag för ökat genomflöde. För att svara på syftet har följande frågeställningar legat i grund för syftet; Vilka utmaningar har MTO-företag med avseende på genomflöde? Vilka verktyg och standarder är lämpliga att tillämpa hos ett MTO-företag för ett ökat genomflöde i tillverkningsprocessen? Metod – Studien bygger på en abduktiv ansats där författarna har valt att använda sig av triangulering för att besvara studiens syfte. De datainsamlingsmetoder som använts är litteraturstudier, intervjuer, observationer och dokumentstudier. Författarna har gjort en teorigenomgång inom aktuellt område för att få en inblick i vilka teorier som finns inom det berörda området. En analys har där efter gjorts utifrån den empiri som samlats in och kopplat detta till det teoretiska ramverket. Resultat – Resultatet författarna har kommit fram till är att det inte finns någon given metod eller standard för MTO (Make to order) företag att implementera. Författarna har däremot kommit fram till att det handlar om att arbeta med flera modeller och standarder parallellt för att få en större påverkan på materialflödet. Det är viktigt att veta vad som kan standardiseras och inte ifall produktvariation och kundanpassningen är hög hos MTO-företag. Implikationer – Denna studie har som implikation att belysa de utmaningar MTO- företag kan ställas för vid olika grad av kundanpassning. Studien belyser även den komplexitet som finns för materialflödet hos MTO-företag. Författarna har i denna studie även tagit fram en modell för fallföretaget över huruvida deras produktionslayout kan anpassas för ett högre genomflöde. Begränsningar – De begräsningar som återfinns i denna studie är att studien är gjord med enbart ett fallföretag där insamling av data skett under en begränsad tid. Där av är resultatdiskussionen anpassad utefter fallföretagets verksamhet men en rekommendation från författarna är att studien kan valideras på likande verksamheter.

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This Master’s thesis has been carried out within the subject area of Production Development and Management and aims to reduce internal lead times in make-to-order (MTO) and job-shop production environments with the use of identified theoretical methods. The reason this particular production environment was chosen was the flexibility and satisfaction it provides its customers. Today, customers expect customised products, a situation which causes problems for manufacturers as they are unable to produce such products in large amounts. In order to investigate problems with these kinds of environments and the causes for long lead times, we have conducted a literature study where we identified the problems these particular kinds of production environments experience regarding production planning and control which are related to the immense amount of time consumed by changeovers because of high demand variance and high requirements for customisation. To affirm the theoretical findings, we opted to undertake a case study and chose Talent Plastics Gislaved AB as our case, because this company utilises an MTO and job-shop production environment for its production of highly customised products with high demand variance. In the analysis of our case, we found that the wastes in the organisation were similar to those identified in the theoretical findings. The current planning system and the current state of the manufacturing lead time system were evaluated and a theoretical framework using a combination of lean production, work load control and constant work-in-process theories was suggested. We claim that concentrating on the reduction of setup times can lead the job-shop towards drastically decreased lead times and a much more effective use of time throughout the organisation. Because the organisation will continue to face problems due to the ever-increasing demand variance and requirements for customisation, there are plenty of opportunities for further research in these kinds of production environments. Emerging theories, such as quick response manufacturing, may also be tested to construct an efficient framework.

In this study, an operational (short term) flexibility management approach is proposed for make-to-order companies with flexible shops. Order Review and Release (ORR) techniques and typical Flexible Manufacturing System (FMS) decisions are combined in this method. The proposed method prepares a shop environment by allocating process and routing flexibility types at different levels to the shop in each production cycle. Variety, volume, and criticality of the part types in the pool and the anticipated orders constitute the main inputs for flexibility allocation. A flexibility management policy is introduced and determination of the proper policy is realized with the integrated utilization of mathematical programming and simulation modeling. An experimental study is performed to investigate the effects of proposed method on a hypothetical flexible shop. Results show that with an appropriate policy, periodical and online flexibility management can be an effective tool to cope with uncertainty in demand if combined with ORR techniques.

Workload control (WLC) systems constitute a framework mainly for the inputoutput control systems which regulate both jobs&rsquo / queues into the workshop and the flow of finished goods out of the workshop. This study is concerned with the job entry and release level of WLC which maintains a pool of unreleased jobs for the controlled release of jobs. While most of the studies in WLC concepts deal with the centralized workload control, our study decentralizes the job entry and release control and makes workstations more powerful in schedule decision making. Job&rsquo / s information is sent to the workstations by mediator which is the supervisor of the workstation. Both mediator and work stations are represented by agents in a distributed system. Jobs&rsquo / routing information is assumed to be known in advance. The developed system is verified and validated by means of test runs. Results are analyzed as well.

A high level of competition in the food industry, specifically in the Middle East and the UK has forced companies to improve their processes by reducing lead time, waste, and costs and increasing production efficiency. The main challenge to the achievement of the process improvement objectives is the high level of process variability. Therefore, this research investigates the different types of variability in food production system and proposes a methodology to reduce the effect variability in food production system. The variability can be caused by several factors, for instance, in biscuit production lines variability can be induced due to short breakdown and long breakdown, variable processing times, variable temperature, etc. The proposed approach addresses process time variability issues associated with both make-to-stock (MTS) and make-to-order (MTO) manufacturing environments using an iterated approach. The proposed methodology integrates process mapping, (which is a lean tool for identifying value added and non-value added activities), discrete event simulation (to mirror the real production line), Taguchi orthogonal arrays (to generate different scenarios in order to investigate the effect of variability on the simulation model), correlation analysis (to identify the highest variability factors), and the rule based system (to improve food production system performance based on identified key performance indicators (KPIs)). The research uses a biscuit production line as a case study to validate the proposed methodology. The application of the proposed approach determines that the highest effected KPI is %working. The results showed that after implementation of the rule-based system, key performance improved in high variable areas. Results analysis based on before scenario shows that %working performance indicator is highly effected by variable temperature, speed, and breakdown factors for high variable areas such as baking, cooling, aligning, and packing. Based on identified factors and high variable areas, rules are developed by applying standardisation setting (SOP, WI, PP) in high variable areas and the results shows %working improved in baking by 4.78%, in cooling by 16.06%, in aligning by 0.35%, in packing machine1 by 2.5%, in packing machine2 by 2.37%, in packaging1 by 3.35%, and in packaging2 by 3.16%. The integrated method allow quick response , control the environment without production interruption, reduce number of experiments , and reducing variability in high variable areas, which narrowed the improvement in the required areas and increased its effectiveness.