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

Explain about changing the layout of empty cubicles, Is there an optimal si...

Is there an optimal size for all organizations? Also how should one go about changing the layout of empty cubicles?

Analyzing a current OM technique, ind a scholarly journal article reporting...

ind a scholarly journal article reporting on one or more of the following techniques: business analytics, dashboards, decision support systems, predictive analytics, or supply chai

Explain when you find the potential energy of something, When you find the ...

When you find the potential energy of something and its negative what is the significance of the algebraic sign?

Explain business practice or an invasion of privacy, Prospective employers ...

Prospective employers can conduct a credit check along with a background check to determine employment eligibility. Do you feel this is good business practice or an invasion of pri

Evaluate the two competitor''s strategies, As the industry watches to see h...

As the industry watches to see how United Airlines' strategy performs against American Airlines' strategy, management at United Airlines is anxiously monitoring market signs to det

Explain toyota-production-system-principle, Some information about the toyo...

Some information about the toyota-production-system-principle just in case

Analyze the environment and processes and procedures, Analyze the environme...

Analyze the environment, processes, and procedures at your work or school to determine which aspects can be controlled and which cannot be controlled. Explain your rationale. •From

Evaluation of potential projects by weighted scoring matrix, Evaluation of ...

Evaluation of potential projects by weighted scoring matrix: A five year project has a projected net cash flow of $20,000, $25,000, $35,000, $15,000, and $25,000 in the next f

Explain essential components of a marketing plan, What are the essential co...

What are the essential components of a well-balanced marketing plan?

Explain when you go shopping for a new computer, When you go shopping for a...

When you go shopping for a new computer, is your real objective to import a computer into your apartment, or is it to export cash from your wallet? What does this tell you about th

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