4-10-07 cycletime

4-10-07 cycletime - 1 Cycle Time Management Professor...

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Unformatted text preview: 1 Cycle Time Management Professor Robert C. Leachman IEOR 130, Methods of Manufacturing Improvement Spring, 2007 Introduction and Overview “Cycle time” is semiconductor industry jargon for the elapsed time to pass manufacturing lots through the manufacturing process, from lot creation until lot completion. The term is also applied to individual manufacturing steps, measuring the elapsed time from completion of the preceding step until completion of the step in question, or to a series of manufacturing steps (the sum of the cycle times of the subject steps). In produce-to-order environments, cycle time is part of the product/service apparent to the customer and is therefore an important competitive issue. Suppliers able to offer shorter cycle times will be preferred. In the case of goods experiencing a rapid pace of technological obsolescence such as semiconductors, cycle time has a very strong influence on realized average selling prices. Firms with shorter cycle times are able make sales at earlier times when prevailing prices are higher. And by making those sales, they tend to drive prices down and thereby diminish revenue available to competitors. A general managerial strategy with respect to cycle time is proposed as follows: (1) Management should impute an economic value to cycle time and declare this value to the engineering and operations organizations. Management should require that any proposals for changes to the manufacturing process or to operational policies that would change cycle times must be justified by quantifying the overall economic impact, including the gain or loss in value associated with changes in cycle time. (2) Entitlement cycle times should be calculated for every product and process. Entitlement cycle time is the result of an analytical calculation or simulation determining what cycle time the manufacturing process is capable of, considering the process specifications, the equipment released, statistics on process times, and statistics on process and equipment trouble. Practical tools must be distributed to the engineering organization enabling them to measure entitlement cycle times, not only for the current situation, but also for any proposed changes to process, production volume or operational policy. (3) Management should establish cycle time goals for each product. These goals may be dynamic, anticipating learning curve improvements. Where entitlement cycle time is larger than the cycle time goal, the engineering organization must devise changes to equipment, process or policy enabling the goal to be met. 2 (4) Where actual cycle time is larger than entitlement cycle time, the manufacturing organization needs to improve execution. Improved execution tools may be required, i.e., more advanced planning and scheduling systems....
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This note was uploaded on 04/02/2008 for the course IEOR 130 taught by Professor Leachman during the Spring '07 term at Berkeley.

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4-10-07 cycletime - 1 Cycle Time Management Professor...

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