Inventory and capacity trade-offs in a manufacturing cell

This paper describes an investigation into the trade-off between capacity, inventory and variance reduction techniques for buffering against uncertainty and model mix fluctuations in a manufacturing cell. The cell is patterned after one that produces engine blocks which feed directly on to the assembly line at a plant manufacturing large diesel engines. A simulation model is used to evaluate the effect of different buffering techniques on capacity utilization, throughput time and output rate. Two production control systems are used in the cell, one based on a pull approach, the other on a push approach. The results show that variance reduction and capacity increases are serious alternatives to using inventory for buffering in either system.