OM (Chapter 10)

short-term:

• amout of overtime scheduled for the next week
• numberof emergency room nurses on call during a downtown festival weekend
• number of all center workers to staff during the holiday season

long-term:

• Construction of a new manufacturing plant
• expanding the size and number of beds in a hospital
• number of branch banks to establish in a new market territory

1. Add or share equipment (Leasing of equipment)
2. Sell unused capacity (to other firms)
3. Change labor capacity and schedules (overtime)
4. change labor skill mix (hire the right people)
5. shift work to slack periods

1. Vary the price (cheap on weekends)
2. Provide customers with information (automated messages)
3. Advertising and promotion ( After holiday sales)
4. Add peripheral goods/ services (movie theatre rentals at slow times)
5. Provide reservations

Set of principles that focuses on increasing total process throughput by maximizing the utilization of all bottleneck work activities and workstations.

Amount of money generated per time period through actual sales.

Anything that limits an organization from moving toward or achieving its goal.

Constraint of the capacity of a resource (Machine, employee)

Avtivity that effectively limits capacity of the entire process.

environmental or organizational constraint (low product demand or and inefficient management policy or procedure)

Nonbottleneck Management principles

• Idle time is acceptable (low resource utilization)
• Use smalles order sizes
• An hour lost at nonbottl. has no effect on entire process

Bottleneck Management principles

• Critical to achieving process, should be scheduled first
• An hour lost at bottlen. is an hour lost for whole process.
• Use large order sizes for minimizing setup time
• Bottlen. should work at all times