Page 450 - Orlicky's Material Requirements Planning

428 PART 4 Looking Backward and Forward

Trying to use level-loading in conjunction with seasonally adjusted buffered items
poses a problem. Seasonal buffer profiles will mirror their bulge effect with regard to
capacity requirements. The biggest capacity contention occurs during the ramp-up peri-
od going into a high-demand period. Generally, during periods in which capacity is
under more contention, batch sizes should be increased (assuming that there is a time
cost associated with setup). During times when capacity is under less contention, setups
should be less of an issue, and batches can track to demand or replenishment require-
ments more closely.
Figures 25-7, 25-8, and 25-9 are examples of how the preceding aggregate buffer pro-
file might translate to batch requirements to build up the seasonal buffer positions and
then be responsive to requirements during the high season. Figure 25-7 is meant to show
an average batch size that grows during the ramp-up period. This is due to the fact that
during the buffer ramp-up period, load exceeds average plant capacity of 60,000 gallons
per day. This means that capacity has become a bottleneck during this time period. A bot-
tleneck, by definition, is “a facility, function, department, or resource whose capacity is
less than the demand placed upon it. For example, a bottleneck machine or work center
1
exists where jobs are processed at a slower rate than they are demanded.” When capac-
ity becomes a bottleneck, saving setup is an appropriate tactic (assuming that there is a
capacity cost to a setup). During this time, the plant will be running larger batches and
possibly using overtime, additional shifts, or even temporary labor. In so doing, its out-
put probably will exceed its average calculated capacity.
Notice how the average batch size grows during ramp-up but quickly reduces when
buffer positions have been established. Now the factory has “sprint” or surge capacity in
order to react to how the buffers are performing while it is still peak season. The factory
is essentially storing capacity in strategic or safe positions, as defined by the buffers, and

FIGURE 25-7
Variable Batch
Variable batch
size to coincide
with buffer
Note: Smaller batches during
strategy.
peak and second half of high
season

Buffer ramp up Agile and responsive

1 APICS Dictionary, 12th ed. New York: Blackstone, 2008, p. 14.