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General Information Manual
Improved Job Shop Management
Through Data Processing
Copyright 1960 by International Business Machines Corporation
Contents
INTRODUCTION 5 Manpower ..... ................................................ 26
PART I: THE NATURE OF THE PROBLEM ................. .
Cost of Resources .......................................... 27
7
The Goals. of Management ................................. . 7 C: Dispatching Rules - Organization of
The Inventory Problem ....................................... . 7 Resources in Relation to Work ........... 28
The Machines and Manpower Problem ............ .. 7 Rule 1: First Come, First Served ............ 29
The Work-in-Process Problem ............................. . 8 Rule 2: First Come, First Served, within
The Changing Order Problem ........................... . 9 Dollar-Value Classes . ................. 29
The Dispatching Problem ................................... . 9 Rule 3: Minimum Slack Time per
The Interrelation of All Problem Areas ............. . 11 Remaining Operation ................ 29
The Trial and Error Solution ............................. . 11 Rule 4: Shortest Processing Time for
The Computer Simulation Solution ................... . 12 Present Operation ...................... 30
PART II: DESCRIBING THE JOB SHOP FOR Rule 5: Longest Processing Time for
SIMULATION PURPOSES ............................................... . 14 Present Operation ...................... 30
A: Orders -The Job of the Job Shop ............... . 15 Rule 6: Earliest Planned Start Date ........ 31
Order Items and Quantities ....................... . 15 Rule 7: Earliest Planned Start Date
Raw Material Costs ..................................... . 15 within Dollar-Value Classes ...... 31
Order Routings and Processing Times ..... . 15 Rule 8: Earliest Due Date ........................ 31
Lower Limits for Simulation ..................... . 16 Rule 9: Dollar Value and Start Date ...... 31
The Order Record .................................... .. 16 Rule 10: Random Selection ...................... 32
The Problem of Scheduling ....................... . 16
PART III: THE DEVELOPMENT OF SIMULATION
The Nature of a Schedule ........................ .. 17
INFORMATION FOR DECISION ...................................... 33
Forward and Backward Scheduling ........ .. 17
The Simulation Procedure.................................... 33
Simulation as an Aid to Improved
Simulation Output .......................................... 34
Scheduling ...... ,........................................ . 18
Output Reports .................................................. 34
The Built-In Scheduling Procedure ........ .. 19
1. Identification Report ................................ .... 34
Adjustment of Recorded Processing
2. Load Analysis Report .................................. 35
Times for Scheduling ............................. . 20
3. Shop Performance Report .......................... 36
Adjustment of Recorded Processing
4. Labor Utilization Report ............................ 37
Times for Simulation .............................. 21
5., 6. Analysis of Queues ........................................ 37
Order Arrival Rate ...................................... 22
7. Tabulation of Completions ........................ 39
Order Release Pattern .............................. .. 22
8. Inventory Carrying Cost Report ............... 39
Orders Already in Process ....................... .. 22
Late Order Releases .................................. .. 23 ApPENDIX I List of All Input Cards.................... 4]
Origin of Orders for Simulation .............. . 23
ApPENDIX II The Synthetic Order Tape
B: The Shop's Resources ................... ......... ...... .... 24 Generator ...................................... 45
Time .............................................................. 24
Machine Tools ............................................. 25 ApPENDIX III Order Analysis Program .................. 49,
Introduction
Some of the most complex problems confronting mod- The specific program was developed by Interna-
ern business lie in the area of manufacturing control. tional Business :Machines Corporation in cooperation
At the same time it has become increasingly apparent with the General Electr~c Company. Its scope actually
that enormous savings may be gained by effective solu- extends beyond the job shop context into the area of
tions to these problems. Efforts to effectively deal with scheduling problems generally. The specific use to
them in the past have been hampered by two related which it is put depends on how its variables are inter-
difficulties. One of these is the great volume of infor- preted. In exploring its use in connection with job
mation which must be taken into consideration. The shop manufacturing only one application of the pro-
other is the comparatively small amount of time which gram is being considered. In this application the pro-
is available before decision is necessary. gram design enables companies with job shop type
The advent of the powerful data processing system operations to experiment with these operations on a
in recent years has changed this picture considerably. computer simulation basis.
Because of its large storage capacity and electronic For the majority of practical situations an IBM 704
speed it is capable of both processing voluminous in- with at least 8,192 words of storage and the following
formation and arriving at results which are timely system components is necessary: 5 magnetic tape units,
in relation to manufacturing processes. I card reader, 1 printer (with standard SHARE con-
This manual contains a description of the way in trol panels).
which an IBM 704 Data Processing System can be used Readers of this manual who wish to avail them-
to deal with difficult problems in the area of job shop selves of the 704 program may obtain it by writing to:
manufacturing. It will be concerned with discussing Applications Library, International Business Machines
the logic of the approach which has been taken by the Corporation, 590 Madison Avenue, New York 22, New
704 program rather than the technical details of the York. In addition to the program cards, a program
program. In this sense it is application-oriented. Along listing, block diagram, assembly information, operat-
this line it will attempt, first of all, to clarify the na- ing instructions, and information on how the program
ture of the problems involved in designing an dfec- may be modified in certain respects, will be sent. The
tive job shop. Once attention has been brought to information and materials which are available have
a focus on the problems, the manner of their solution an immediate bearing on the 704 program as such and
will be discussed in considerable detail. are necessary for its use.
Introduction 5
Improved Job Shop Management
Through Data Processing
PART I
The Nature of the Problem
The Goals of Management The Inventory Problem
A basic necessity for any manufacturing organization Let us consider still another way of dealing with the
is to have sufficient machines and manpower. If suf- customer delivery problem. Why not maintain a large
ficient machines and manpower are not available, inventory of finished products? If this were done,
orders will not be delivered to its customers on time. customer orders could be filled from stock. Customer
The responsibility for satisfying this goal lies with deliveries could be immediate.
management. In many cases, however, the finished products in
If meeting customer delivery obligations were the question are not known in advance. They must be
only goal, it could be achieved very easily. The prob- manufactured according to specifications which are
lem could be solved by having a very great number of not known until the order is placed.
machines and unlimited manpower. If this were done But even when this is not so, there are still other
every customer order could be quickly completed. problems. It is necessary to consider the cost of
No order would ever have to wait until a machine maintaining an inventory. Capital tied up in inven-
or an operator became available. Since there would tory is not directly producing income. Instead, it is
be no waiting, the amount of time required to com- subject to such additional charges as insurance and
plete an order would be no greater than the amount storage. It also involves risks, such as the possibilities
needed for actual processing. This would be ideal of obsolescence, spoilage and changing market con-
from a customer's standpoint. ditions. These costs must be balanced against the ad-
Unfortunately, from the standpoint of manage- vantages of meeting customer obligations quickly. The
ment in a manufacturing organization, this solution most efficient use of available capital funds is cer-
is completely unrealistic. The cost of having so much tainly another of management's goals.
manpower and so many machine tools would make Quite possibly management might decide to main-
the price of the product so high as to be noncompeti- tain a partial inventory. Such an inventory might
tive. There is no point to having a lot of machines consist of parts and assemblies of finished products
if you have no customers. for which there is repeated demand. If this were done,
It can be seen from this that the problem of de- it would take less time to fill a customer order for the
ciding how many machines to have is not simple. finished product.
It is difficult because management must take many The fact of the matter is that many means might
goals into account. Thus, the additional goal of suc- be used to adequately meet customer delivery obliga-
cessfully competing with other manufacturers affects tions. This does not, however, eliminate the goal of
the means which may be used to achieve the goal of using manpower and machines as efficiently as pos-
meeting customer delivery obligations. The existence sible.
of both goals at the same time places management in
the position of having to work with comparatively
The Machines and Manpower Problem
limited machine and manpower resources. The effort
to achieve both goals dictates that these resources be The efficient use of machines and manpower is actu-
used as efficiently as possible. As will be seen later, ally not very difficult where manufacturing requires
this is in itself no easy problem. only one type of machine. In this situation experi-
The N"ature of the Problem 7
ence will have shown that a certain quantity of this tinuc to grow behind certain machine groups. This
type of machine and operator is required. Predicted would happen if orders are arriving at these machines
demand for the product involved will also make pos- faster than they can be processed by them. At the
sible the provision of additional tools and operators same time machines may be idle at other points of
for the future. the shop. Under these conditions the machine and
Actual manufacturing, however, is not usually as manpower efficiency level of the shop is suffering.
simple as this. Consider the situation where the prod- The practical problem is to improve efficiency.
uct changes, and where its manufacture involves more In an actual shop it may be at just this point that
than a one-tool, one-operator process. Suppose it in- the possibility of installing an additional machine sug-
volves many different types of .tools and operators. gests itself. Perhaps this will solve the bottleneck
Job shop manufacturing tends to be of this type. problem and thereby increase efficiency. Before de-
Physically, the most common job shop consists of a ciding, however, it is important to know just how
collection of machine tools -lathes, drill presses, mill- much efficiency will increase. But this would be very
ing machines, and so on. Ordinarily these machines difficult to estimate. Because of the complexity of the
are of the general-purpose type, capable of being used situation even intelligent estimates might easily be
in the production of a variety of finished products. wide of the mark.
Job shop machines are usually arranged in physical Management's decision here is complicated by the
groups on the basis of the general type of work they fact that other considerations are involved. It is also
perform. The work lots handled by these machines a management goal to keep the cost of machine tools
tend to be variable in several respects - quantity, down. If this particular goal were the whole basis
dollar value, and type. Such variations, along with for decision, no machine would be added.
the general-purpose character of the machines, make The point is, however, that the problem does not
for a number of possible paths along which jobs can lend itself to solution in terms of anyone principle.
move. Different types of orders may use the same ma- In abstract it is certainly desirable to minimize capi-
chines at 'different points along their work paths. tal investment in machine tools. But this is so only
This kind of manufacturing contrasts with what has if order delivery obligations can still be adequately
been called the continuous type. In continuous man- met.
ufacturing, work routes are fairly fixed. The machines The problem of what to do about the situation
are more specialized and are used in the production exists because these two goals are in conflict. If the
of comparatively fixed end products. comparatively low efficiency of the shop means that
Let us take a closer look now at some of the prob- too many orders are delivered later than they were
lems facing management in the specific situation of promised, this could be serious. The cost of customer
a job shop. First of all, the general problem of ma- dissatisfaction might be much greater than the cost
chines and manpower also exists here. It is especially of an additional machine.
difficult, in the complex situation of an actual job An economic balance between these factors is nec-
shop, to decide how many of each type of machine essary. But this can be properly achieved only when
and operation the shop. should have. It was suggested fairly precise information on the effect of installing
at the outset that having too many machines would an additional machine is available. Only such infor-
be too costly. The specific problem of how many is mation could make clear whether or not it is worth it.
too many is related to the question of how efficiently Yet it is exactly such precise information which is so
available machines can be used. often missing.
An illustration of a practical job shop situation
may help to clarify the complexities involved here.
TheWork-in-Process Problem
The various types of machines making up a job shop
are functionally related to each other. This is true The entire problem has still not been clarified. Let
because each machine is a working unit in the paths us consider another factor involved in a practical
along which orders may flow. Some of the machine attack upon the bottleneck situation. This is the so-
operations necessary for an order are required earlier called "in-process" inventory investment.
in time than others. In addition some of the opera- Like finished stock inventory, work that is in the
tions take much longer than others. A short opera- process of moving through the shop also represents
tion may follow a long operation but it cannot be an investment of money. Such funds are frozen so
begun until the longer one has been completed. long as the work remains in process. If it remains in
In this situation, as a given set of orders moves process longer than necessary, the money resource of
through a shop, waiting lines may develop and con- the organization is being used inefficiently.
8
Investment in an additional machine, by speeding The Dispatching Problem
the flow of work in the shop, might result in lessen-
The question of how many machines are desirable
ing the amount of money tied up by in-process inven-
depends partly on how efficiently their use is organ-
tory. This saving could also easily overbalance the
ized. A comparatively few machines can do more
cost of the additional machine.
work than a greater number if they are used more
Unhappily, a usefully accurate prediction of the effectively. In fact, not only machine tool efficiency
degree to which in-process inventory would be re- but everyone of the management goals discussed is
duced is also difficult to make. Yet the question of affected by the "strategy" with which machines are
degree is again central in importance. Without such put to work.
knowledge management is operating in the dark. In a job shop this strategy expresses itself by de-
cisions made at machine operating stations. These de-
cisions must be made. They can, however, be made
either on a haphazard basis or in terms of a guiding
The Changing Order Problem principle established by management decision. Such
Among other things, an accurate prediction depends a principle is usually referred to as a "dispatching
also on the volume and type of customer orders which rule."
may be expected. The strategy contained in a dispatching rule comes
into play every time it is necessary to decide which
If the volume falls below a certain point, there may
available machine should be put to work on which
already be enough machines. Previous bottlenecks
eligible customer order. In effect, the rule decides
might vanish. In this case an additional machine
on a priority rating for each order. Thus, given a
might have no purpose. It might neither reduce in-
machine and a collection of orders now requiring it,
process inventory nor help meet customer delivery
the priority ratings determine the sequence of assign-
schedules.
ment to the machine.
If the type of customer order changes, work routes One very simple strategy is the so-called "first come,
will also change. This is a frequent occurrence in a first served" rule. On this basis the highest priority
job shop. As a result a bottleneck at one machine is always given to the order which arrives first at a
group might give way to one at quite another ma- machine station. The application of this rule in the
chine group. Since this is a possibility the question shop is a very simple matter. Orders arriving at a
of whether to obtain an additional machine is not machine station are simply placed at the bottom of a
separable from the question of which machine it list. Machine assignment is made from the top of the
should be. list. The priority of each order is fixed by its position
Only a few of the problems involved in so seemingly on the list. It is not reviewed or changed as new
simple a management decision have been touched orders arrive.
upon. It should be evident, however, that this ques- Since a great many different strategies are possible,
tion of additional machines cannot be separated from management's problem is to decide which one offers
such matters as the volume and type of orders in the the most advantages. There is no doubt that the "first
shop. Similarly, it cannot be properly considered in come, first served" rule has all the advantages of sim-
isolation from the goal of adequately meeting cus- plicity. This, however, is not sufficient recommenda-
tomer delivery obligations. Nor can it be considered tion. What is important in evaluating it in relation
apart from the goal of reducing in-process inventory to other possibilities is its consequences for the total
and capital investment generally. All of these matters job shop operation. What comparative effect does it
bear upon each other. It should also be pointed out have on the value of in-process inventory? Will it
that the same problems surround decisions regarding result in more efficient usage of machines and man-
increases in operating personnel, or increases in the power? Would fewer customer orders be late if some
number of shifts of work, etc. other rule were used? These are the kinds of ques-
Although they are all related to each other, some of tions which must be answered. Only when they are
the problem areas we have discussed center on the adequately answered can a decision be made as to
work orders of the shop. Some are focused on the which strategy would best serve management's goals.
resources of the shop. A third basic problem area has At first glance it would not seem difficult to predict
to do with the way in which the resources of the shop the effects which some rules are likely to have. Let
are organized in relation to its work. This third us consider a specific example. Suppose priorities
problem area further complicates management deci- were to be assigned to orders on the basis of their due
sion at every point. dates. By such a rule each dispatching station might
The ~ature of the Problem 9
give highest priority to the order which has the earli- priority on the basis of the dollar value of the order.
est due date. An order arriving at a given station Such a rule might give precedence to those orders
would be assigned a higher priority than that of any having the highest accumulated value. This strategy
of the orders already waiting, provided that it had an would insure that these orders moved through the
earlier due date than any of them. shop as quickly as possible. Now it is tempting to
On the surface, the general effect of such a rule assume from this that the capital tied up with work
would seem no great mystery. Common sense tends in process would thereby be minimized.
to suggest that the extent of order lateness would be Here again, however, the conclusion of common
reduced. After all, the orders which have due dates sense may easily be false. Assume, for example, that
dose at hand would be processed first. It would seem there are three orders awaiting assignment at a dis-
that the shop is being organized specifically to achieve patch station. Suppose, in addition, that the dollar
the goal of minimizing lateness. values are $1,000 for one of them and $700 each for
This does not, of course, mean that if an "earliest the other two. Now let us assume that the $1,000
due date" strategy were used there would be no late order requires 6 hours on the machine tool in ques-
orders. That would be too much to expect. It has tion, whereas the other two require only 3 hours each.
already been pointed out that the job shop situation In this situation, assigning the $1,000 order first
is complicated. Other factors also have a bearing on would certainly move it through the shop faster. Sur-
whether or not the goal of meeting customer obliga- prisingly, however, it turns out that less capital would
tions is satisfactorily achieved. What one would tend be tied up if the high-value order is not assigned first.
to expect, however, is that those orders which would The basic reason for this is that in calculating in-
still be late would not be as late as they otherwise process inventory cost, time is as important as dollar
might have been. value. Tying up $100 for 3 minutes is not as bad as
Unfortunately, the actual complexity of a specific tying up $1. 00 for 3 days.
job shop situation could easily prove this expectation In the present illustration, for example, there are
wrong. A simple illustration may make this clear. three possible dispatching priority patterns. These as-
Let us assume that the relative priority of two differ- signment sequences are: 1000-700-700; 700-700-1000;
ent orders is under consideration at a dispatching sta- 700-1000-700. The calculation of an in-process inven-
tion. Which order should be assigned to an available tory rating for each, in terms of both dollar value and
machine first? Order 1 has a due date of October 14 time, is shown and explained below.
and order 2 has a due date of October 16. By an DISPATCHING PATTERN RATING OF
"earliest due date" dispatch rule, therefore, order 1 DISPATCHING CALCULATION IN TIME IN-PROCESS
is assigned first. Order 2 is kept waiting. PRIORITY PATTERN AND DOLLAR VALUE INVENTORY
But now consider the situation a bit more closely. 1ST 2ND 3RD
The two orders may have altogether different machine 1 1,000 700 700 (1,400 x 6) + ( 700 x 3) 10,500
tool routes to follow. In view of this it is possible that 2 700 700 1,000 (1,700 x 3) + (1,000 x 3) 8,100
at this point order I has almost been completed. 3 700 1,000 700 (1,700 x 3) + ( 700 x 6) 9,300
Order 2, on the other hand, may still have a great The first pattern above would be the result of a
many machine operations to go through before it is "high dollar value" dispatching rule. According to it,
completed. the $1,000 order is assigned first. During the 6 hours
Under these conditions the decision to keep order 2 of its machining, the two $700 orders are kept waiting.
waiting might have the effect of making this order Hence: (1400 X 6). When processing of the high-
very late by the time it is finished. This would be value order has been finished, one of the $700 orders
especially true if the remaining operations for order 2 is assigned. For the next 3 hours the second $700
were comparatively time-consuming. It might also be order will be waiting. Hence (700 X 3). The rating
that the waiting lines for these remaining operations or index of in-process inventory, considering both dol-
are very long. In addition, other factors might tend lar value and time, turns out to be 10,500. Perform-
in the same direction. To the extent that some of ing the same calculation for the two other dispatching
these conditions exist in the shop, an "earliest due patterns, the ratings turn out to be 8,100 and 9,300.
date" rule would not have the result suggested by Thus, it is the second pattern which is really best,
common sense. The fact is that the actual situation from the standpoint of minimizing capital frozen in
is too involved for easy prediction. unfinished orders. Interestingly enough, this is the
In a similar way common sense might anticipa'te pattern which gives lowest priority to the high-dollar-
the general effect of other dispatching rules. It would value order.
be possible, for example, to have a rule which awards The e~::!mDle above has shown that it i~ necessary
10
to consider the number of comparatively low-value to achieve in its action a favorable balance among all
orders and the amount of time they are tied up in of its goals. The reason a decision regarding a particu-
waiting while a higher-value order is being processed. lar action is difficult is that the action can affect
These factors vary, of course, at different times and more than one goal. The successful solution to the
at different dispatching stations in the shop. This problem demands accurate, detailed in.formation re-
makes it that much more difficult to predict accurately. garding the results of each proposed action. And the
The main point is that common-sense impressions re- basic reason this is so difficult in the job shop situa-
garding the likely result of a dispatching rule are tion is that this situation is so complex.
very likely to be wrong. It is a little like assuming It should be evident now that this complexity
the earth is flat because it sounds pretty reasonable. comes from the fact that an operating job shop is
Many other simple dispatching rules could be used. really a system in which all the parts are related and
It is also possible to combine more than one strategy dependent on each other. In some ways it is like a
in a single rule. Thus, to give a comparatively simple network of rubber bands which are linked together.
example, a rule might assign priorities on the basis of Plucking one makes all the others vibrate. This in
earliest due date and, where there are ties, give first turn reacts on the band which was first touched, and
place to the order having the higher value. The more so on. The main difference is that a system of rubber
complex the rule, the more difficult it is to predict bands tends to return to its original state. By con-
its overall effect. trast, a job shop either gets better or worse and tends
In addition to the unreliability of common sense to stay that way. This is what makes for manage-
in predicting, there is still another great difficulty. ment's opportunity as well as management's risk. The
This problem stems from the fact that, even when it amount and type of information available at the mo-
is possible to guess the general effect of a rule, its ment of decision is what makes it primarily the one
impact can still not be predicted in detail. Detail is, or the other.
however, all-important.
To be sure, it is obvious enough that, all other
things being equal, it is good to reduce the value of The Trial and Error Solution
in-process inventory. But this merely states the goal
in ideal terms. Such a statement pays for being ob- Of course, where information is needed, ordinary ex-
vious by being practically useless. In real job shop perience can generally provide some. It is always pos-
situations the advantage of reducing in-process inven- sible to try changing something in the job shop and
tory depends upon many considerations. Just how then simply wait and see what happens. The effect
much would it be reduced, and just how much would of a change will be known after it has happened.
the reduction cost in sacrificing other goals. In this actual trial approach information is gained
Suppose it should turn out that the price of lower from experience. Unfortunately experience also makes
in-process inventory is a lessened ability to meet some clear that where there is trial there is error. Error is
delivery obligations. This price could be too high. the price of this method.
There is no way of knowing unless these consequences But apart from the fact that a ch~nge may not work
can be predicted in detail. out too well, there are also other circumstances which
The basic question is always: Will the final effect make trial and error difficult. In the first place a
of a rule increase or decrease the "health" of the job shop is not a laboratory. It cannot be made a
shop's operation from the standpoint of management's laboratory without upsetting the shop's work patterns.
goals? In addition it cannot be made a laboratory because
it does not provide the proper conditions for a con-
trolled experiment. It would not be possible to be
sure that all of the significant variables had been con-
The Interrelation of All Problem Areas
trolled. This is important because, if unplanned
Clearly, the same sort of difficulty hangs over all the changes can enter the situation, the relation between
other considerations which have been discussed here. a specific planned change and the final result cannot
The question of whether an additional machine be established. The result may, to some degree, be
should be acquired is as much subject to this difficulty caused by the influence of the uncontrolled variable.
as is the question of what dispatching rule to use. It is Has the experimental change improved the shop or
certainly desirable to avoid investing in additional not? The answer to this question would still not be
machines- but only so long as goals A, B, C, - - - - - - - Z clear.
are not affected too adversely. Another difficulty is that it takes time to acquire
This, then, is the heart of management's problem- experience. If every reasonable possibility for improv-
The ~ature of the Problem 11
ing job shop operation were tried, it would take a ning the risk of bad guessing. A valid decision
great deal of time. Also, during this time the condi- could therefore come before actual trial in .the
tions under which the shop would operate might shop instead of following it.
change. This alone could cancel much of the value 5. Information would be in sufficient detail to en-
of previous experience. able decision.
One change that is very common is a change in the
On the surface, satisf)ring the above conditions
type of order processed. It may not be possible to con-
seems a little like having your cake and eating it too.
trol such a change. If there are frequent and signifi-
cant changes in the "order mix," learning from With the development of the high speed computer,
however, this is no longer a dream.
experience is rather hopeless from the outset.
In recent years there has been increasing interest
Still another difficulty associated with trial and
in the use of computers for the solution of some of
error merits brief mention. It might be called the
the more difficult problems of manufacturing control.
"irreversibility" problem. The difficulty here stems
Much work has been done in connection with the
from the fact that many of the decisions which may
problems we have been discussing. It has become
be made in a job shop are not reversible once they
clear, for example, that the most important aspects
have been made. It may be desirable, for example,
of job shop operation can be expressed in numerical
to find out what effect adding a machine would have.
terms. This applies to such things as the due dates
But the decision is an "either-or" decision: you either
of orders, the number of machine groups in the shop
add one, or you don't. Suppose a machine is added
and the number of machine tools in each group, the
and the results are disappointing. The die has none-
amount of processing time each machine operation
theless been cast because the machine has already been
takes, the number of shifts during which the shop op-
obtained.
erates, the amount of manpower available for each
A careful examination of the trial and error ap-
shift, the cost per hour of each operation, etc. In ad-
proach would reveal still other difficulties. Enough
dition, the dispatching procedure used in a shop can
has been said, however, to suggest that while it may
also be expressed in numerical and logical terms.
sometimes be a path to improvement, it is also a fairly
What this means is that a description of a physical
rocky and uncertain path.
job shop can be made in terms of these variables. This
Unfortunately, however inadequate a method of
description can be entered into a computer. In effect,
trial and error may be, until recently management has
the entire pattern of variables necessary for describ-
had little choice but to rely on it. Management has
ing a shop - those having to do with orders) shop l-e-
therefore been in the position of having to make
sources and dispatching strategy - can be read into a
guesses. It has also been obliged to pay for the bad
computer. The large storage capacity of a modern
ones.
computer makes a fully workable description possible.
Now a computer is essentially a processor of infor-
The Computer Simulation Solution mation - a data processing system. Its processing abil-
ities can therefore be used to turn a "static" descrip-
An ideal solution to the problem would eliminate the tion of a shop into a model of an operating shop_ The
guesswork. It would have all of the advantages of an application of a dispatching rule, which is what is in-
actual trial and still avoid its costs and its uncertain- volved here, uses the computer's ability to make
ties. Let us be as clear as possible about this. An logical decisions. At the same time, its processing
idea~ solution would satisfy at least the following con- ability enables it to calculate the changes which would
ditions: occur in the value of certain factors because of the
1. Information would be obtainable quickly. It shop's operation. To sum it up, it is possible for a
would therefore be appropriate to current shop computer to simulate the actual operation of a job
conditions. Its usefulness would not be de- shop.
stroyed because conditions had changed while The important thing to note at this point is that
it was being ga thered. simulating the actual operation of a shop is not the
2. The process of obtaining information would not same thing as simulating an existing shop. In fact the
upset the normal operation of the shop. usefulness of a computer here is that it can simulate
a proposed shop. Thus, if a change in an existing
3. The information would be reliable. There shop is proposed, the computer can simulate the op-
would be no problem of questioning results be- eration of the shop as it would be if the change were
cause of accidental or uncontrolled factors.
carried out. In this way it can test the effect of chang-
4. Information would be obtained without run- ing a dispatching rule, or the number of machines,
12
or the number of shifts of work, etc. a variety of products. Such products may be sales
Simulation, of course, has meaning only if the com- reports, budget reports, inventory reports, payroll
puter is able. to present its results in a meaningful way. checks, etc. Each of these jobs is likely to follow a
The results are all-important. They must enable man- different work route and have different due dates.
agement to decide on the advantages or disadvan- Because of such similarities the operation of a
tages of possible changes in the existing shop. They punched card installation involves many of the same
should therefore be presented in terms of the ways in problems as a job shop. Thus, many of the principles
which they influence management's goals. In other for running a job shop efficiently also apply to the
words, the results of a proposed change for such punched card system.
things as the value of in-process inventory, the meet- The general point in this is that the specific prob-
ing of customer obligations, the percentage of ma- lems of a job shop sometimes find a close parallel in
chine tool and labor usage, etc., must be shown. other business problems. This is so even when their
The introduction to this manual announced that immediate content is entirely outside the area of
a data processing application had been developed to manufacturing control.
do exactly this. It satisfies all of the conditions speci- Perhaps the main reason for this is that the logical
fied above. It is flexible in its ability to. simulate structure of the job shop as a whole is basically the
the important characteristics of a shop. The results same as that of a business as a whole. The situation
of simulation are shown in a set of printed reports. always involves work, resources, and rules for apply-
In this way, the effect of changing any of the char- ing resources to work. For this reason the task of
acteristics of the shop can be conveniently displayed. operating a job shop is, at bottom, the same as that
The remaining sections of this manual will be de- of running any business. From management's point
voted to a more detailed discussion of this application. of view it always consists of selecting and using re-
Before turning to this, however, the present chap- sources as efficiently as possible to achieve the goals
ter will be concluded with a few remarks on some of of the organization. The specific goals and resources
its more general uses. involved may be different. Resources may be harbor
Some organizations operate entirely as a job shop. or airport facilities, or traffic lights, etc. The impor-
In addition, almost evc::ry manufacturing organization tant thing, from the standpoint of using the present
contains some operations which are of the job shop application in other areas, is that the basic model is
type. Over and above this, however, the present ap- the same.
plication is pertinent to many work situations not This is not the place to further explore such paral-
ordinarily associated with an actual job shop. lels. Their existence, however, gives the simulation
To mention one example, a punched card data approach to job shop problems additional signifi-
processing installation resembles a job shop in many cance. They are mentioned here only to illustrate the
ways. Like a job shop, it contains different types of bearing which a computer, as a management tool, has
general-purpose machines. It is capable of producing upon the solution of business problems generally.
The Nature of the Problem 13
PART II
Describing the Job Shop for Simulation Purposes
The first part of this manual has endeavored to make Thus, in the application's chronology the 704 pro