SM Thacker & Associates

Highlights of our full range of training courses / Workshops:

Lean & Agile Supply Chain / Inventory Modelling

Lean & Agile Manufacturing Planning & Control

Operations Management / Team Leader Training

Step Change Management / Business Process  Reengineering

Continuous Improvement

Procurement (Purchasing & Supplier Management)

IS / IT / e-commerce

Product Management / New Product Introduction  / Quality  Management

Relevant Training Course / In-house Workshop Highlights:

M14 Lean & Agile Manufacturing

M21 Lean Manufacturing

Relevant Further Reading: The following further articles were mentioned in this paper:

Lean Manufacturing

Lean Manufacturing Question

Answer to question posed in Lean Manufacturing

Links to related training and further reading on left

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If the first process breaks down the second process cannot produce, so demand is not fulfilled unless there is stock between them. If the second process breaks down demand is not fulfilled so stock is needed after the second process.

Also capacity is usually expressed as average output. Peak demands cannot be satisfied unless there are buffers after the second process.

How much stock?

In the first case the first process cannot catch up because the capacities are equal when both machines are working. So the stock holding required is infinite since over time any buffer will be depleted. The opportunity to rebuild stock only occurs when the second process breaks down. Meanwhile it could have depleted anything other than an infinite buffer.

In the second case it is a lost sale because if you are working at capacity you are only meeting demand so anything other than an infinite buffer will be depleted!

If the first process is starved of raw materials demand will not be fulfilled, so anything other than infinite buffer stocks of raw materials will become depleted.

So you thought it was a simple question and that this supply chain was the simplest you could imagine and the processes the most reliable you could dream of! And every manufacturing business is trying to balance the supply chain and fill their capacity!

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