Simulation and Optimization of Production Control for Lean Manufacturing Transition

Title of Document: SIMULATION AND OPTIMIZATION OF PRODUCTION CONTROL FOR LEAN MANUFACTURING TRANSITION Sean M. Gahagan, Ph.D., 2008 Directed By: Associate Professor Jeffrey W. Herrmann, Department of Mechanical Engineering Lean manufacturing is an operations management philosophy that advocates eliminating waste, including work-in-process (WIP) inventory. A common mechanism for controlling WIP is “pull” production control, which limits the amount of WIP at each stage. The process of transforming a system from push production control to pull is not well understood or studied. This dissertation explores the events of a production control transition, quantifies its costs and develops techniques to minimize them. Simulation models of systems undergoing transition from push to pull are used to study this transient behavior. The transition of a single stage system is modeled. An objective function is introduced that defines transition cost in terms of the holding cost of orders in backlog and material in inventory. It incorporates two techniques for mitigating cost: temporarily deferring orders and adding extra capacity. It is shown that, except when backlog costs are high, it is better to transform the system quickly. It is also demonstrated that simulation based optimization is a viable tool to find the optimal transition strategy. Transition of a two-stage system is also modeled. The performance of two simple multistage transition strategies is measured. In the first, all of the stages are transformed at the same time. In the second, they are transformed one at a time. It is shown that the latter strategy is superior. Other strategies are also discussed. A new modeling formalism, the Production Control Framework (PCF), is introduced to facilitate automated searches for transition strategies in more complex systems. It is a hierarchical description of a manufacturing system built on a novel extension of the classic queue server model, which can express production control policy parametrically. The PCF is implemented in the form of a software template and its utility is shown as it is used to model and then find the optimal production control policy for a five stage system. This work provides the first practical guidance and insight into the behavior and cost of Lean production control transition, and it lays the groundwork for the development of optimal transition strategies for even the most complex manufacturing systems. SIMULATION AND OPTIMIZATION OF PRODUCTION CONTROL FOR LEAN MANUFACTURING TRANSITION