Theory of Constraints Handbook - James Cox Iii [271]
10. Late—Received (DR). The work order was received after the time it was scheduled on the drum. By definition, it has caused a disruption to the drum schedule.
In Drum-Buffer-Rope (DBR), “Early,” “Late,” and “Red” zone arrivals should require a reason code to be attached to the job explaining why this work arrived when it did. In the previous example of a buffer board, the reason code is forced in order for a work order to move from the “Yet to Be Received” status to the “Received” status. A red zone arrival is not necessarily a negative thing—in fact a good system should have approximately 20 percent of its work arriving in this zone—as it is pointing us to the work center with the greatest opportunity to apply improvement focus (i.e. Lean tools) to enable shrinking the buffer and cycle time (more on this in the following section “Metric 2: Local Improvement/Waste”).
The reason codes for early and late are essential in removing the variation from inaccurate standards and routings resulting in a more accurate model for scheduling. The beauty of TOC is that it allows any company to start on a process improvement path regardless of the state of accuracy of their routings and standards. Buffers are initially sized to absorb the system’s current variation. Entry into the received status of the buffer parts that have inaccurate routings or standards will fall outside the green and yellow zones. These part work orders will be captured in the red, late and early zones with a reason code denoting the standard is wrong or the routing is wrong. This allows a systematic method to correct those parts and remove variation. Ultimately, this allows for more accurate ropes, smaller buffers, and shorter cycle times.
Stock buffers according to the TOCICO Dictionary (Sullivan et al., 2007, 43) are defined as “(a) quantity of physical inventory held in the system to protect the system’s throughput.” (© TOCICO 2007, used by permission, all rights reserved.) In TOC, these stock buffers also have five zones for management and measurement. Figure 14-7a visibly depicts the typical stock buffer zones.
As you can see, light blue (some authors call this the white zone) depicts a position that is overstocked. Green indicates a position with ample stock, which requires no action. Yellow indicates a stock position that is in its rebuild zone. Red typically means danger or expedite, while dark red gives a visible signal of out of stock (some authors refer to this as the black zone). The total number of parts as well as the total number of days those parts have spent in red “stocked out” and “stocked out with demand” can easily be tracked over time. An example is illustrated in Figs. 14-7b and 14-7c. In both figures, the vertical axis simply represents various part numbers. In Fig. 14-7b, you can see that part 78df has been stocked out 58 days over a 180-day period. Within that 58-day period, for 34 of those days, the part has been stocked out with demand against it (represented by the dark red portion on the right side of the bar). Obviously, it is more damaging to be stocked out with demand. In Fig. 14-7c, you can see that part r643 has been over the limit of the green zone for 30 days over a 180-day horizon. This kind of clear visibility dramatically increases the reliability of a materials/inventory system over conventional tools like material requirements planning (MRP).
The expected behaviors of reliability-based metrics are quite simple. First, localities will perform work in an accurately prioritized sequence since buffer status is a direct reflection of that priority. Second, localities are encouraged to make or buy only what is necessary relative to the buffers. Since these buffers are highly visible, there tends to be little to no conflict about what the real priority is. This is effective Buffer Management (BM). Of course, this assumes that the buffers are set up properly. For more on setting up buffers properly (including placement and sizing), see Drum-Buffer-Rope, Buffer Management, and Distribution of the handbook.