Inventories and Work In Progress (WIP) can be helpful clues to visually identify the bottleneck or constraint in a process, but they can also be insufficient or even misleading as I explained in part 2 of this series.
It is often also necessary to study material and parts routes to really understand where they get stuck and delayed. Chances are that the missing or delayed items are waiting in a queue in front of the constraint. Or have been stolen by another process…
In the search for the system’s constraint, experienced practitioners can somewhat “cut corners” by first identifying the organization’s typology among the 3 generic ones: V, A or T. Each category has a specific structure and a particular set of problems. Being aware of the specific problems and possible remedies for each of the V, A and T categories may speed up the identification of the constraint and improvement of Throughput.
V, A & T in a nutshell
Umble and Srikanth, in their “Synchronous Manufacturing: Principles for World Class Excellence”, published 1990 by Spectrum Pub Co (and still sold today), propose 3 categories of plants based on their “dominant resource/product interactions”. Those 3 categories are called V, A and T.
Each letter stands for a specific category of organization (factories, in Umble’s and Skrikanth’s book) where the raw materials are supplied mainly at the bottom of the letter and the final products delivered at the top of the letter.
V type plants use few or unique raw material processed to make a large variety of products. V-plants have divergence points where a single product/material is transformed in several distinct products. V-plants are usually highly specialized and use capital-intensive equipment.
You may imagine a furniture factory transforming logs of wood into various types of furniture, food industry transforming milk in various dairy products or a steel mill supplying a large variety of steel products, etc.
The common problems in V-plants are misallocation of material and/or overproduction.
As the products, once gone through a transformation cannot be un-made (impossible to un-coock a product to regain the ingredients), thus if material is misallocated, the time to get the expected product is extended until a new batch is produced.
The misallocated products wait somewhere in the process to meet a future order requiring them or are processed to finished goods and sit in final goods inventory.
The transformation process usually uses huge equipment, not very flexible and running more efficiently with big batches. Going for local optimization (Economic Order Quantity (EOQ) for example) regardless of real orders leads to long lead times and overproduction.
V-plants often have a lot of inventories and poor customer service, especially with regards to On-Time Delivery. A commonly heard complaint is “so many shortages despite so many inventories”.
Misallocations and overproduction before the bottleneck will burden the bottleneck even more. Sales wanting to serve their upset customers often force unplanned production changes, which leads to chaos in planning and amplification of delays (and of the mess).
Identification of the bottleneck should be possible visually: Work In Progress should pile up before the bottleneck while process steps after the bottleneck are idle waiting for material to process.
Note: while the bottleneck is probably a physical resource in a transformation process, the constraint might be a policy, like imposing minimum batch sizes for instance.
A-plants use a large variety of materials / parts / equipment (purchased and) being processed in distinct streams until sub-assembly or final assembly, that make few or a unique product: shipbuilding or motor manufacturing, for example.
Subassembly or final assembly is often waiting for parts or subassemblies because insuring synchronization of all necessary parts for assembly is difficult. Expediters are sent hunting down the missing parts.
Expediting is likely to disrupt the schedule on a machine, a production line, etc. If the wanted part is pushed through the process, it is at the expense of other parts that will be late. The same will repeat as the chaos gets worse.
In order to keep the subassembly and assembly busy, planning is changed according to the available kits. Therefore some orders are completed ahead of time while others are delayed.
The search for the bottleneck(s) starts from subassembly or final assembly based on an analysis of the delays and earlies. Parts and subassemblies that are used in late as well as in early assemblies are not going through the bottleneck. Only parts constantly late will lead to the bottleneck. For those, follows the upstream trail until finding the faulty resources where the queue accumulates.
T type factories have a relatively common base, usually fabrication or assembly of subassemblies and a late customization / variant assembly ending in a large display of finished goods. Subassemblies are made to stock, based on forecasts while final assembly is made to order and in a lesser extend made to stock. In this latter case it’s to keep the system busy even there are no sufficient orders. Assembly is made to stock for the top-selling models.
Computers assembled on-demand for instance use a limited number of components, but their combinations allow a large choice of final goods.
In order to swiftly respond to demand, final assembly generally has excess capacity, therefore the bottleneck is more likely to be found in the lower part – subassemblies – of the T.
The top and bottom of the T-plants are connected via inventories acting as synchronization buffers. The identification of the bottleneck(s) starts at the final assembly with the list of shortages and delayed products. The components or subassemblies with chronic shortages or long delays point to a specific process. The faulty process must then be visited until finding the bottleneck.
Yet bear in mind that assembly cells, lines or shops may “steal” necessary parts or components from others or “cannibalize” i.e. remove parts or subsystems on some products for completing the assembly of others. If this happens, following the trail of missing and delayed parts upstreams can get tricky.
Combinations of V, A and T plants
V, A & T-plants are basic building blocks that can also be combined for more sophisticated categories. For instance a A base with a T on top, typical for consumer electronics. Yet the symptoms and remedies remain the same in each V, A & T category, combined or not.
As we have seen so far along the 3 parts of this series, the search for the constraint in a system is more an investigation testing several assumption and checking facts before closing in on the culprit.
There are some general rules investigators can follow, like the search for large inventories in front of a resource while the downstream process is depleted of parts or material, but it is not always that obvious.
Knowledge about the V, A & T-plants can also help, without saving the pain of the investigation. And we are still not done in the search for the constraint! There is more to learn in the part 4!
Readers may be somewhat puzzled by my alternate use of the name bottleneck and constraint despite the clear distinction that is to be made between the two. This is because in the investigation stage, it’s not clear if the bottleneck is really the system’s constraint. Therefore, once identified, the critical resource is first qualified as a bottleneck and further investigations will decide if it qualifies for being the system constraint or not.
Bibliography about V, A & T-plants
For more information about V, A and T plants:
- Try a query on “VAT plants” on the Internet
- “Synchronous Manufacturing: Principles for World Class Excellence”, Umble and Srikanth, Spectrum Pub Co
- “Theory of Constraints Handbook”, Cox and Schleier, Mc Graw Hill