Throughput Manager Game

[5 marks]

In this problem you will play with the Throughput Manager, a game/ exercise to explore the concepts underlying process science and throughput management. Download the file ThroughputManagerGame.xls from the course site and save it on your computer. You need to Enable Macros, for the file to run on your system, which may need changing the security settings through Tools Macro Security. On opening the Excel file you see a model of manufacturing plant with an IN Station, four resources A, B, C, D, and an OUT Station as shown in the Input sheet. The characteristics of these resources and cost associated with each of them are detailed in sheet System Information. You can lay out three alternative designs for the process by entering appropriate data in each of the columns in the Input sheet. The number of resources at each location can be varied from 1 to 10. Between these resources, possible buffer positions 1-5 are marked. Two buffers of capacity ranging from 1-1000 can be chosen from these five alternative locations. When you click on the Run Scenarios tab, you are taken to the Results sheet The Result sheet shows you the performance of three alternatives entered by you in a tabular form. You can compare the throughput, equipment cost and WIP factors which determine the cost benefit score for each of the alternatives. Weight of each factor is preset and shown under the WT column; however they can be changed to explore a different set of scenarios later on. Further, the FCR column shows the contribution ratio of these factors in decision making. In another table bottleneck for each of the alternatives is compared. Nominal throughput possible through the bottleneck resources and the efficiency of each of these alternatives is also shown. The sheet Basic information describes some fundamental concepts of throughput science. Your aim is to maximize the cost benefit score, for given weights of factors. You can vary the number of resources between the given limits, and you can also set buffer location and capacity as indicated. Remember that there is a cost associated with increase in the number of resources or buffers, so be watchful as you make changes. At any stage, keep the best alternative so far and change the other two alternatives to see if you can improve overall process performance. Explore as many possibilities as you can. Try to reach your own conclusions from the exercise about the bottleneck resource operation, placement of buffer and throughput improvement.

Report the following: A. Best Cost/Benefit Score. Review how you made progress in improving throughput while balancing other issues of cost and WIP. After you reach the best alternative place the buffer at the bottleneck resource, increment it from 0 to 1000 in steps and plot the impact on throughput, efficiency and cost benefit score. B. If minimum throughput required to meet the demand is 40, explore the best alternative in terms of cost/benefit score and in terms of efficiency. Are they same? Why or why not? C. Consider scenarios where inventory cost is low by changing weights to 0.6, 0.3, and 0.1 for Throughput, Equipment cost, and WIP respectively. Under what situations could such values arise? Report the best cost/benefit scenario(s) and compare with the earlier solutions. D. Consider scenarios when inventory carrying cost is rather high - change weighs appropriately along the lines shown in C and report results. Again, under what situations could these arise? E. Explain how different types of imperfections (failure frequency, downtime duration, imbalances etc.) interact and affect a process. Finally, conclude with general Operations Management lessons that can be drawn from this game.