Manufacturing Master Schedule

The first concept to understand is that Company B is indeed "several companies within acompany"; for scheduling purposes. Company B looks like most other companies with large, complex structures. It has many parts and subassemblies coming together at a configuration of "demand rated" tooling for final assembly. The final assembly process has several positions that move at the same rate; that being the demand rate of the customer. The fallacy in the thinking was that all previous and supporting operations of final assembly had to move at the same rate as final assembly. While it is true that all operations must move at least as fast as final assembly, it is not true that they have to move as fast as final assembly.

The mindset that all operations need to be paced at the same rate as the end of the line causes a company to add cost to its products. This added cost is a product of the schedule failure that is being built into the schedule before it ever goes to the floor. A good example of this condition is revealed by looking at a typical product; the GSIV.

GSIV's demand rate was for one finished product every five (5) working days. Therefore, all supporting assembly operations were presented with a schedule for one each of their subassemblies every five working days. In turn, the Industrial Engineering Department set the manning levels for the subassembly departments based upon the schedule requirements. The lE's were careful to match the manning levels (capacity) very closely to the load so as to maximize direct labor efficiency. While this approach sounds good in theory, it is poor in practical application. By balancing capacity (workers) to the schedule the company is setting itself up for a fall the first time one of the areas misses schedule. Since capacity=schedule, there is very little, if any, residual capacity to regain schedule when (not if) an area falls behind.

Conversely to falling behind, some subassembly areas will get ahead of schedule. This condition creates another set of problems equally as bad as missing schedule. Since the workers are dedicated to the GSIV product line, in particular, certain assemblies, they have nothing to do except build ahead. This creates a rippling affect through the rest of the organization. Order Release is requested to release more work. Material Planning must replan material to respond to the accelerated schedule, and Purchasing must expedite material from suppliers. All of these needless activities add cost to the product, but they do so in an indirect fashion, contributing mostly to overhead. These costs are not readily visible when the cry goes out for more work. The only visible impact at the time is the fateful "direct labor efficiency" measurement. There is a way to avoid the pitfalls mentioned above, that being through proper MPS and BOM techniques, and a recognition on the part of management that there are other ways of running a business.

Since the rate tooling moves the same at every position, we can master schedule at as many of those positions as we choose. The way in which we select the positions to be submitted to MPS is based upon the subassemblies that feed a given position. For example, the position that drives the bonded assembly requirements can be selected to provide scheduling flexibility for the bonding department. The positions that drive certain types of minor subassemblies can be master scheduled for better control of those areas. Since these subassemblies are now master scheduled, they can have rates of move developed individually. The only constraint we have to keep in mind is that the rate of move cannot be slower than the final assembly positions. The advantage

of altering the schedule for the subassemblies is that we can better manage the labor, most likely reduce it.

The previous schedule for a subassembly area would have had all of the supporting subassemblies moving at one every five days. Now we can change the rate of move on certain subassemblies to perhaps two days; maybe three for others; or four. Instead of certain workers being assigned to certain subassemblies, they are now assigned to a family of subassemblies. Since we can vary the schedule rates on the subassemblies we can be more flexible with the workers. Now the workers can be mixed and matched to a variable number of subassemblies. This arrangement provides other benefits. Once the proper mix of subassemblies and rates are identified, bills of material are constructed under them to allow MRP to process and schedule the components and raw materials. Now the components and raw materials match the schedule and can support the flexibility required in subassembly.

By using the methods described, Company B can build flexibility into its system rather than schedule failure.