Changes In Product Mix Research Articles

The reconfiguration issues in manufacturing systems

The main characteristic features of today’s dynamic manufacturing environments are apparent and they can be listed as follows: stochastic demand, variable but smaller production batch size, frequent and unpredictable changes in product mix, highly variable processing and set-up times, variable production sequences, very high volume of information and a strong competition. To become competitive and thrive under such environments, the production system should be managed to respond quickly and cost effectively. To sustain competitiveness and agility under this unpredictable environment, appropriate design strategies for the reconfiguration of production facilities should be developed to improve their performance. In this paper, the reconfiguration issue in future manufacturing systems is highlighted and a new integrated approach for the reconfiguration of cellular manufacturing system is introduced. The proposed approach constitutes of sub-modules, namely: configuration and reconfiguration module, loading module, and simulation based scheduling module. The main focus of this research work is the configuration and reconfiguration module. Answers to two important questions “ When do we reconfigure?” and “ How do we reconfigure?” are provided.

Virtual cell formation

The concept of a virtual cellular manufacturing system (VCMS), which operates very much like a traditional cellular manufacturing system (CMS), has attracted considerable attention in recent years. Unlike traditional cellular manufacturing systems, virtual cellular manufacturing systems are most suitable in production environments that experience frequent product mix changes. Whereas, in traditional CMS, the shop floor configuration is fixed, in VCMS the shop floor configuration changes in response to changes in product mix over time. Therefore, the life of a given shop floor configuration continues as long as the product mix remains relatively unchanged. Furthermore, whereas in traditional cellular manufacturing systems, a machine cell occupies a contiguous region of the shop floor, the same is not necessarily true with virtual cells. Virtual manufacturing cells are simply logical cells in which the machines belonging to the same cell need not occupy the same contiguous area. Because cell members are logical instead of physical, machines in a cell can be at any location on the floor. In this paper, we present a methodology for designing virtual manufacturing cells.

Unidirectional AGV guidepath network design: A heuristic algorithm

In an AGV system, the design of the guidepath network is one of the most important factors that determine the system effectiveness. Many alternative guidepath design schema have been introduced in the literature. However, the methods generally address the static production environment where the product mix or machine routings are assumed to be stable over time. In today's dynamic production systems with small lot sizes and short product cycles, the assumption of an unchanging product mix over an extended period is unrealistic in some situations. Considerable system inefficiency can be introduced when a network designed under the assumption of a stable product mix is used when indeed the product mix has changed. To avoid this kind of hidden source of inefficiency, what is needed is a tool that can recognize when a previously designed network is inappropriate for a new product mix and then uses the new product routing information to reconfigure a new network appropriate for the new production condition. A heuristic algorithm for the design of AGV guidepath in an environment with changing product mix is proposed here. The algorithm not only makes it possible to adapt the system network as the product mix changes, but also produces new designs at reasonably short computational time.

THE DESIGN OF RAPID PRODUCTION PLANNING MECHANISM FOR THE PRODUCT MIX CHANGING IN A WAFER FABRICATION

ABSTRACT Due to supply over demand, the wafer fabrication industry in Taiwan became dramatically competitive. Providing more service or flexibility for customers is very important for manufacturers. Among them, flexibility in order changeover for customers is one of key issues. This paper develops a rapid production planning mechanism, containing three modules, for reacting product mix changing problems. When product mix change is requested, the target planning module updates the performance targets (product cycle time, throughput, order due date) with an analytical method. Then, capacity demand evaluation module monitors the loading of bottleneck and capacity-constrainted resources (CCRs) by order-oriented scheduling method so as to prevent bottleneck from shifting. Finally, integrated performance evaluation module evaluates the difference in the profit making and in system slackness that induced from the changing of product mix. The case study showed that the rapid production planning mechanism not only achieved the system targets, but also set an achievable due date for these changed orders. It also decreased the impact from changing product mix, since the loading of bottleneck and CCR machine were controlled in the capacity demand evaluation module. The rapid production planning mechanism proposed hence is effective and efficient for wafer fabrication.

CO 2 Emission Trends in the Cement Industry: An International Comparison

We present an in-depth decompositionanalysis using physical indicators oftrends in Carbon dioxide (CO2) emissions in the cementindustry in Brazil, China, South Korea andthe United States. Physical indicatorsallow a detailed analysis of intra-sectoraltrends, in contrast to the often usedmonetary indicators. We assess thecontribution of different factors affectingCO2 emissions in the cement industry,including change in product mix, efficiencyof power generation, changes in fuel mixand changes in energy efficiency. Thedecomposition results show that in allexamined countries, increased productionwas the main contributor to the increase intotal CO2 emissions. Energy-efficiencyimprovement is the most important factorthat led to the reduction of emissionintensities for all countries except Korea.For Korea, structural change in the productmix is the most important factorcontributing to the emission intensityreduction.

A Structural Decomposition of Energy Consumption Based on a Hybrid Rectangular Input-Output Framework: Japan's Case

This paper proposes an I-O SDA model, based on a commodity technology assumption, to identify the sources of changes in the energy demand structure, the non-energy input structure, the non-energy product-mix and the non-energy final demand of embodied energy requirements. The model contains two features. First, the hybrid rectangular input-output framework expressed in both monetary and physical terms is introduced to relax the effects of different energy prices among industrial sectors on the input structure in physical terms. Second, the demand structure of the input-output system is decomposed into the structure of energy sectors and other sectors by applying the hierarchy system with feedback loops of non-energy sectors. We identify the sources of the changes in Japan's energy use structure between 1985 and 1990. The major findings are that the total energy requirement has increased, mainly because of the changes in the non-energy final demand, while the product-mix changes have opposite effects, that is, energy savings.

Combining Activity-Based Costing with the Simulation of a Cellular Manufacturing System

Abstract Discrete-event simulation is one of the most effective techniques for analyzing a manufacturing system. Unfortunately, little attention is given to using simulation models to estimate the economic impact of a proposed system configuration. This paper defines how activity-based costing (ABC) concepts can be incorporated into a discrete-event simulation model. Special emphasis is on demonstrating how decision making can be aided by having the simulation create a detailed “Bill of Activity” describing costs associated with manufacturing a part. The integration of ABC and simulation is illustrated by evaluating the impact of a proposed manufacturing cell configuration. The additional costing information aids in cell design, determining part sequencing and scheduling, and provides a quick evaluation of product mix changes for a part family.

A multi-echelon multi-commodity, logistic system design at the Dead Sea Works Ltd

The Dead Sea Works Ltd extracts more than 2 million ton of potassium a year from the Dead Sea and ships it by surface and marine transportation to markets around the world. Product mix and market distribution changes have made it necessary to redesign the surface logistics system. This system consists of four sites with a total of more than 300,000 ton of roofed storage capacity. The purpose of the study was to suggest changes in the storage capacity of each product at each of the sites. We have designed a model that expresses the expected annual loss for the firm and have solved it under potential market scenarios and management and technological constraints. Sensitivity analyses were then carried out for several uncertain cost and reliability parameters. Based on the best system configuration for each scenario, alternative configurations were designed in detail and compared under potential market scenarios. With a clear understanding of the risks and expected benefits involved, the decision makers then selected the best configuration. The annual net benefit from implementing the proposed solution is expected to be 1.7 million dollars.

Effect of Irrigation Development on Greenhouse Gas Emissions in Alberta and Saskatchewan

Irrigation can be a major emitter of greenhouse gases, and can contribute to global climate change. Most studies dealing with the evaluation of irrigation projects worldwide have not taken this aspect of irrigation development into account. In this study, changes in greenhouse gas emissions from converting a given area from dryland into irrigated acreage in Alberta and Saskatchewan were estimated. A systems approach was used in which changes in crop production mix are considered in terms of induced livestock production, increased input demand, and other induced economic activities. A modified Canadian Economic and Emissions Model for Agriculture was employed to estimate the change in emissions. The net contribution of irrigation to emissions of three major greenhouse gases (GHG): carbon dioxide, methane, and nitrous oxide was estimated. Results suggest that each hectare of land converted into irrigation leads directly to an additional emission of major GHG of 1.68–2.61 t yr−1 (in carbon dioxide equivalents). When various indirect and induced sources of emissions were included with the direct emissions, irrigation’s net emission level is 3.35–3.65 t ha−1 yr−1 (in carbon dioxide equivalents). Additionally, storage reservoirs, developed for supplying water to these irrigation projects, could also be associated with emissions of GHGs. Considering all these sources, irrigation adds 3.7% and 6.5% of total (agriculture and agri-food sector level) GHG emissions in Saskatchewan and Alberta, respectively. This has implications for the assessment of future irrigation projects from an environmental perspective.

A survey of index decomposition analysis in energy and environmental studies

Index decomposition methodology was a technique first used in the late 1970s to study the impact of changes in product mix on industrial energy demand. A survey in 1995 listed a total of 51 studies. Since then, many new studies and several new decomposition methods have been reported and the methodology has been increasingly used in energy-related environmental analysis. We trace these new developments, discuss method formulation using an index number framework, and classify more than one hundred studies based on application area, aggregate indicator, and decomposition scheme. Application issues useful to researchers undertaking new studies and possible areas for future research are presented.

A transformed two-stage method for reducing the part-usage variation and a comparison of the product-level and part-level solutions in sequencing mixed-model assembly lines

The minimization of the two-stage variation in the mixed-model sequencing problem of reducing the part-level variation is transformed to product-level terms. The development is based on an existing simplification of the one-stage part-level variation, a simplification of the two-stage part-level variation, and the usage of a relationship matrix that evaluates the relevance among the product structures of various models. Algorithms based on these simplification and transformation are presented. The transformation can be shown to be equivalent to that of Bautista et al. (1996) but results in a smaller empirical computational burden in minimizing the two-stage variation and uses a relationship matrix that is independent of product-mix changes. The computational results show that the transformed two-stage algorithm significantly outperforms the direct enumeration method in computation time for large problems, and generally outperforms the one-stage method in mean squared deviation. The transformed two-stage method can be used as a heuristic procedure or as an intermediate tool for another solution approach. A more general sufficient condition than the existing conditions for the equivalence of the problems of minimizing the product-level variation and minimizing the part-level variation is also presented. The computational experimentation demonstrates that there is a potential of obtaining significantly better solutions in part usage variation by directly considering the part-level variation when this sufficient condition is not met.

The effect of new and continuing prescription drug use on cost: A longitudinal analysis of chronic and seasonal utilization

To provide basic information about 2 factors contributing to rising prescription drug costs--utilization trends and product selection. Prescription drug costs have risen sharply in recent years, and continued growth is expected. There is little consensus about appropriate cost-management strategies, in part because quantitative data on the causes and implications of increased drug costs are lacking. This study followed 463,820 continuously enrolled adult (> or = 18 years of age on January 1, 1996) utilizers of 15 chronic or seasonal therapeutic classes for 2.5 years (January 1996 through June 1998) using a pharmacy benefit manager's multiple-payer claims database. Outcome measures included (1) change in utilization rate, (2) relationship between new use and utilization growth, (3) stability of the treated population (ie, mostly long-term use vs high rates of turnover), and (4) product mix changes (ie, cost per dispensed day for 1996 vs 1997 and for new vs continuing users, controlling for inflation). Of the 463,820 utilizers, 97% were commercially insured and 3% enrolled in Medicare risk plans; 40% were enrolled in managed care and the remainder covered by indemnity insurance. Rates of growth and turnover varied substantially by class. The highest 2-year utilization rate change was 66.7% for antihyperlipidemic agents; change was < 10% in only 3 classes. Across classes, an average of 38.7% of 1997 users were new (ie, no use in 1996) and an average of 34.0% of 1996 users were dropouts (ie, no use in 1997). Utilization growth depended heavily on treatment continuation; classes with high dropout rates (eg, antirheumatic, antiasthmatic) did not have high growth rates, even with high rates of new use. In most classes, costs were not higher for new than for continuing users. In some classes, however (eg, antipsychotic, antidiabetic), both new and continuing users increased their use of newer, more expensive products. Because factors underlying rising prescription drug costs vary by therapeutic class, cost-containment strategies should address these differences. Further research is needed to assess the clinical and economic costs and benefits of rapid growth in the utilization of certain therapeutic classes.

A decomposition technique for quantifying real process performance

A decomposition technique for quantifying the impacts of changes in product mix and process performance on aggregate process-related indicators is presented. Through application of the technique, the real performance of a process can be quantified. Changes in real performance over time can be monitored to provide useful information for process evaluation and production planning. Two case studies, one related to the aggregate defective rate for an assembly line of an integrated circuit fabrication plant and the other to the aggregate inventory turnover for a tyre distribution company, are presented to illustrate the application of the technique.

Facility layout design in a changing environment

Increasing global competition, rapid changes in technology and the necessity to respond quickly to a cost and quality conscious customer have changed the dynamics of facilities planning. Today's manufacturing facility needs to be responsive to the frequent changes in product mix and demand while minimizing material handling and machine relocation costs. In this paper, we present a framework for the design of a dynamic facility which can respond effectively to the changes in product design, mix and volume in a continuously evolving work environment. A genetic algorithm-based heuristic is used for solving the design problem and two test cases are presented to illustrate the use of the methodology.

AN OVERVIEW OF TRADEOFF CURVES IN MANUFACTURING SYSTEMS DESIGN

In this paper we review the use of tradeoff curves in the design of manufacturing systems that can be modeled as open queueing networks. We focus particularly on the tradeoff between expected work‐in‐process (or product leadtime) and capacity investment in job shops. We review the algorithms in the literature to derive tradeoff curves and illustrate their application in evaluating the efficiency of the system, in deciding how much capacity to have, how to allocate resources between the reduction of uncertainty and the introduction of new technologies, and how to assess the impact of changes in products throughput and product mix. The methodology is illustrated with an example derived from an actual application in the semiconductor industry.

The bitter and the sweet

This paper focuses on the processes by which different manager groups can influence product mix changes. The paper analyses three different types of process ‐ dominance, compromise and integration ‐ through which the extensiveness and renewal of a product mix was shaped by groups of marketing and production managers, general managers and owner‐managers. Each of the groups developed their own understanding, or “logic of action”, about the most desirable product mix. It is shown that these logics of action play an important role in product mix changes, not as isolated elements but in interaction with one another and the industry context. This paper provides a detailed empirical analysis of a product mix pattern over a long duration by illustrating the three different forms of managerial interaction by which the product mix was achieved. The contribution of the study is twofold. First, the study shows that historical and contextual studies are required in order to understand the role and relevance of marketing activities and marketing based actors in business firms. Second, the study gives evidence for the usefulness of inter‐disciplinary research and discussion within the field of marketing studies.

Decomposition of aggregate defective rate in batch production

In batch/short run production, changes in productmix (or inter-product demand) can have a significant impact on the overall process defective rate, but this effect neglected in process quality analysis. This paper describes the use of a decomposition technique to single out this effect and the effect associated with changes in real process performance. The technique allows both effects to be expressed in indices which conveniently summarize information in a more concise and is often usable form. The results of an application study using a set of batch/short-run production data are presented.

Concurrent consideration of product design, process planning and production planning activities

In manufacturing engineering, product design, process planning and production planning activities are often considered independently. However, in order to effectively respond to changes in business situations, such as changes in demand forecast, product mix and technology, it is desirable to consider them concurrently. For this purpose, a large-scale linear programming model has been developed. The model considers minimization of the sum of processing cost, late shipment cost and inventory holding cost as the objective, and concurrently selects product designs, and generates process plans and production plans. The number of columns in the formulation can be large and, hence, an efficient column generation scheme is developed to solve the model. The model and solution procedure are illustrated with examples.

Can More Frequent Price Changes Lead to Price Inertia? Nonneutralities in a State-Dependent Pricing Context

The authors present a generalized (s,S) state-dependent pricing model in which menus are changed, not just in response to price misalignment but also in response to factors such as changing product mix. Their model generates aggregate price inertia, and so reverses an important earlier result on neutrality in state-dependent pricing contexts in more general settings than previous modifications. It also provides a compromise between state- and time-dependent rules, gives a glimpse at the dynamic implications of menu cost models, and reproduces two recent results: one on Phillips curve slopes and one on asymmetric fluctuations. Copyright 1997 by Economics Department of the University of Pennsylvania and the Osaka University Institute of Social and Economic Research Association.

Decomposition of Aggregate Energy Intensity of Industry with Application to China, Korea and Taiwan

There have been significant decreases in the aggregate energy intensity of industry in China, Korea and Taiwan since 1980. We decompose changes in this often-used energy performance indicator into contributions associated with industry product mix and sectoral energy intensity. In all cases, the results obtained show a large effect of changes in sectoral energy intensity and a relatively smaller effect of changes in product mix. We further decompose the sectoral energy intensity effect to identify the impact of fuel substitution. It is concluded that decreases in the aggregate energy intensity of industry in the three economies were due primarily to improvements in fuel use efficiency.