How often does the line miss its monthly number?
Nameplate capacity says the plant clears its commitment with 4 percent to spare. Put availability, rate and first pass yield on ranges and the same line misses in 40 of every 100 months, because three numbers that are each usually fine multiply.
Operations Intermediate Monte Carlo Pro engine
After you install, this is the model to open.
Will the Plant Make the Volume?
- In your spreadsheet, click the Sortia icon in the strip of icons down the right-hand edge. No strip? Click the arrow at the bottom-right to open it. You can also use Extensions, then Sortia, then Open Sortia.
- Click Start from a template and put that name in the search box.
- Pick the card with that name and click Load this template. It arrives on a new tab with real numbers already in it.
This one runs on a Pro engine, and every free install includes five full-quality runs on your own numbers, shared across all five Pro engines rather than five for each. After that, Pro is $199/year.
The answer
- Miss the commitment
- 40% of months, on a plan with 4% headroom
- Good units
- 77,000 expected a month against a 76,000 promise
- Short when it misses
- 3,414 units, not the 1,377 all-months average
- P5 month
- 69,400 good units
One line, 315 planned hours a month, and a commitment of 76,000 good units. At the numbers on the wall the line makes 78,940, which is 4 percent of headroom and reads like a safe promise. Three things are uncertain and none of them is controversial: availability between 72 and 92 percent, first pass yield between 89 and 96.5, and the running rate around 310 units an hour give or take 12.
Click Run. Good output averages about 77,000 units a month with a cautious P5 near 69,400 and a P95 near 84,500, and the miss flag comes back at 0.40. The line that had 4 percent of headroom misses in 40 of every 100 months. The reason is that the three inputs multiply rather than add, so three numbers that are each usually fine produce a month that usually is not.
Availability averages 84.7 percent against the 86 on the wall and yield averages 93.2 against 94, and those two small gaps compound into about 1,900 units a month before the running rate has said anything. The shortfall output is the number to take into the customer conversation. Averaged across all months it is about 1,380 units, which sounds survivable, but averaged across the months that actually miss it is about 3,400, which is a truck.
A monthly average of a shortfall is not what anybody experiences. The tornado puts availability first, the running rate second and yield a long way third, and that ordering matters, because yield is usually where the quality effort goes and availability is where the money is. The second run makes the case for the maintenance contract. Lift the availability range to a PERT of 0.80, 0.88 and 0.92, which is what a response-time commitment actually buys, and run again: mean output rises to about 79,500 and the miss flag falls from 0.40 to 0.19.
Removing the bad tail of availability halves the miss rate without touching yield at all. Two things this model does not know. It draws each month independently, so it cannot tell you whether misses cluster, and they do: the month after a bad changeover is usually another bad month. And it has one line and one product, so it has no view of the mix penalty you pay when the schedule changes product three times a week.
To make it yours, take availability straight from your line monitor rather than from the capacity study, take yield from the quality record, and put your real committed volume in.
The model
It arrives on a tab called Template: Will the Plant Make the Volume:
| Shifts per month (two a day, 21 working days) | 42 |
| Net hours per shift (decimal hours) | 7.5 |
| Line availability (share of planned time run) | 0.86 |
| Units per running hour (rated cycle time) | 310 |
| First pass yield (units accepted first time) | 0.94 |
| Good units per month | 78,940.3 |
| Committed volume (units a month) | 76000 |
| Misses the commitment (1 = yes) | 0 |
| Shortfall against the commitment (units) | 0 |
Once it is in your sheet
- The model arrives with real numbers in it and runs as it stands, so you can press the button first and understand it second.
- Change the numbers to yours. The sheet marks which cells are inputs and which hold formulas, and most labels carry a note explaining the row.
- Press the run button at the bottom of the panel. It is labeled for the tool you are in, and the result lands on its own tab, with a written reading of it beside the figures.
Never used Google Sheets? Start here goes the whole way, in seven steps, and assumes nothing.
Next question
- How much cash does the bigger buy tie up?Which Season Plan Should the Chain Commit To?
- Are bookings growing, or is that the zigzag?Smooth the Booking Curve
- Can you spot the bad batch before inspection does?Predict the Defect Before It Ships
- Does the new capacity pay if growth stops?Should We Add the Second Line?
- How often does this plan beat the deadline?Will We Be Ready for Peak?
- Could your sample keep checking the same head?Pull the Units to Inspect
Every model like this one, and the method behind them: Monte Carlo simulation.