Friday, October 5, 2007

7.Forecast “push,” customer “pull,” and hybrid models

Attributes of a "push" System

- Manufacturing activities are planned based on a market forecast rather than actual customer demand.

- Implicitly this means:

- There is an emphasis placed on a central planning function
- Service levels are assured by increasing or decreasing finished goods inventory levels.
- The system optimzes “efficiency” rather than “effectiveness” by leveloading the factory.
- Material flows through the factory in batches following a prescribed routing sheet attached to the work order.
- There is a heavy reliance on heuristics to compensate for the inherent complexty of the optimization problems encountered.
- “planning horizons” and “fences” are used to adjust the production plan on a weekly or monthly basis based on the forecast.
- Distinction between dependant and ndependent demand.

Attributes of a "pull" System

- Manufacturing plan is based on actual customer demand “pull”.

- Implicitly this means:
- Control of manufacturing execution is at the working level.
- Service levels are assured by increasing or decreasing kanban levels between workstations (WIP).
- The system is optmized for “effectiveness” which is achieved through continuously improving “efficiency”.
- Material flows through the factory based on visual queues triggered by customer “pull” from the final kanban.
- The system requres a very hands-on management style.
- Culmination of all lean principles. Kanban, Andon, Kaizen, 5S,

Hybrid Model

"The issue is not to make a choice between MRP and JIT, but to make the best use of both techniques." – Karmarker (1989)

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