Theory of Constraints Handbook - James Cox Iii [147]
V, A, T, and I Flows—Descriptions and Examples
V-Plants
V-plants are dominated by the presence of divergence points throughout the product flow. The PFD for a plant that exhibits divergence at every step is shown in Fig. 8-13. Notice that this diagram resembles the letter V; hence, the name V-plant. In addition, in most real life V-plants, the different products share common resources at most stages in the process. A steel rolling mill provides a good example of a V-plant. The first step in the process is annealing where the sheets of steel are softened in preparation for rolling. At the rolling operation, a given piece of steel can be rolled into any of a large number of different thicknesses. Rolling represents a divergence point. At each divergence point, the number of distinct products increases. For example, after rolling each of the different thicknesses, steels can be heat-treated to many different products with different strength and hardness characteristics (based on the manner of heat-treating). Each of these steels, now with unique thickness and mechanical properties, can be cut into desired widths at the slitting operation. From just a few varieties of steel coils at the start of the operation, one can end up with thousands of finished products—characterized by thickness, mechanical properties, width, and length.
FIGURE 8-13 Product flow diagram illustrating a typical V-plant.
The existence of divergence points gives rise to three primary characteristics of a V-plant regardless of the specific industry or materials.
1. The number of end items is large compared to the number of raw materials. Because divergence points exist throughout the different stages of production, by the time several stages are completed, the number of different products can be very large as can be seen in the rolling mill example.
2. All end items are produced in essentially the same way. All products are processed through the same basic operations—rolling, heat-treating, slitting, etc.
3. The equipment is generally capital-intensive and highly specialized. The evolution into capital-intensive equipment is not difficult to understand. Since every product goes through the same sequence of operations, there are a relatively small number of basic operations performed repeatedly. Because the focus of improvement under the traditional cost-based system is to reduce the product’s direct labor content, the equipment naturally became specialized, high-volume, capital equipment.
The one characteristic that all V-plants share is that despite having high levels of finished goods inventory, there is constant scrambling to meet customer requirements. The capital-intensive nature of the equipment, which typically comes with lengthy setup times and the presence of divergence points, is at the heart of this problem. The lengthy setup times encourage supervisors to increase batch sizes, to minimize setups by combining batches whenever possible, and to produce families of products together. All of these actions, which are consistent with cost-world thinking,13 result in a mismatch between customer required priorities and production priorities. In addition, the large production batches cause the production lead times to increase. The result of all of these actions is that lead times are long and unpredictable and this ultimately leads to missed due dates.
FIGURE 8-14 The WIP profile of each resource (in hours of work for that resource) for a V-plant.
V-plants typically face the following concerns:
1. Finished goods inventory is large.
2. Customer service is poor.
3. Manufacturing managers