Time lag effects - operations function, Operation Management

Assignment Help:

Time Lag Effects - Operations Function

Feedback control in complex systems can bring its own problems, due to time lag between measuring the output deviation and realising the effects of the corrective adjustments. A well-known illustration of this phenomenon was presented by Jay W Forrester in his book, Industrial Dynamics. He had been consulted by a white goods manufacturing concern which had been experiencing wildly fluctuating production levels over a period of years; despite the best efforts of the company's management they had been unable to keep production output in reasonable balance with customer demand. Forrester and his team studied the operations of the company's distribution chain (shown in simplified form in the figure) and formulated a computer simulation model of the factory - warehouse - distributor - retailers.

1355_Time Lag Effects – Operations Function.png

The figure below (adapted from Forrester, 1965) shows the results obtained when a 10 per cent step-increase in demand at the retail outlets was introduced. This chart is necessarily 'cluttered', to show how the various order, inventory and production levels changed in response to the initial increase in sales.

1964_Time Lag Effects – Operations Function 1.png

For our purposes it will be sufficient if you locate the two lines labeled 'Retail sales' and 'Factory production output'. It was found that, because of a series of time-lags in the chain, the feedback signal was greatly amplified by the time it reached the factory, resulting in over-reaction. Note that the production level climbs by 45 per cent, creating an excessive build up of inventories. In response the production level falls to 3 per cent less than the original level, and so on. It takes about 18 months for the fluctuations to be damped out.


Related Discussions:- Time lag effects - operations function

What are the potential advantages of profit sharing plan, To compete more e...

To compete more effectively, your organization is considering a profit sharing plan to increase employee effort and to encourage employees to think like owners. What are the potent

Explain network design is a key business decision, Network design is a key ...

Network design is a key business decision as well as a technological decision. Why? Provide an example of a company you believe has a good network design, providing supporting rati

Explain deprivation of food, Which of the following independent variables a...

Which of the following independent variables are appropriate for a quasi-experimental design and why? 1. Blood type, 2. Reading group, 3. Level of abuse, 4. Math strategy, 5. Depri

Describe the mission- vision- values- and goals, The formal strategic plann...

The formal strategic planning process has five main steps. We are going to analyze at the first step involving corporate mission, vision, values and goals in the context of the com

Analytical estimating, Analytical Estimating This technique  of work m...

Analytical Estimating This technique  of work measurement  is used  to determine the  time  values for jobs  having  long and  non repetitive  operations. The time  values  ar

Five focusing steps of theory of constraints, Five Focusing Steps of Theory...

Five Focusing Steps of Theory of Constraints Evaporating clouds  This is a term used to describe a methodology developed by Goldratt to resolve conflicts in a 'win-win' m

Describe the rational you used for determining the factors, Select an indus...

Select an industry. Using the Porter's Five Forces of Competition, illustrate the forces to the industry you selected. Explain the rational you used for determining the necessary f

Conscientiousness is a big five dimension that includes, Conscientiousness ...

Conscientiousness is a big five dimension that involve the traits of being-----------------1.unworried; secure and relax/2.imaginative and broad minded/3.responsiable; dependable a

Explain implied warranties of merchantability, The UCC includes both implie...

The UCC includes both implied warranties of merchantability, warranties of fitness, and product liability. Some of these warranties protect the customer from defective products and

Explain cross-cultural repatriation, Preparing employees to work across nat...

Preparing employees to work across national and cultural boundaries is known as: Answer (1) cross-cultural repatriation. (2) Cross-cultural preparation. (3) Culture shock. (4) Reve

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd