Shop Floor Control When Tacit Worker Knowledge is Important

We investigate a shop where the workers and supervisors have tacit knowledge of how to operate efficiently and where efficiency is important to providing capacity to meet demand. This tacit knowledge includes setup dependencies between products as well as which worker or machine is best suited for a particular product. We discuss a real-world shop where this is the case. Management expects workers and supervisors to use their knowledge to schedule efficiently by monitoring their performance based on standards. The question that we explore is how management should control for due date performance in light of the discretion given to the workers and supervisors to sequence jobs on the basis of efficiency. We explore management control of due date performance through the use of order review and release (ORR) and management expediting. We find that although ORR is quite effective at reducing work-in-process (WIP) inventories, it may foster very late deliveries in a shop such as this. In fact, under such conditions, deftly executed expediting with no ORR at all can be far more effective at supporting all deliveries. Even improving ORR into a hybrid by actively updating path efficiencies (observed from supervisor/worker scheduling) did not support a change to this conclusion. Conversely, when conditions are created where tacit knowledge plays a reduced role or utilization is decreased, ORR delivers in a timely manner. The interaction between utilization, WIP levels, and worker knowledge all help dictate the appropriate control methodology.