Production Scheduling – The Danger of Prioritizing by Due Date

This is the second of four blogs on Production Scheduling and the 3 Shop Floor Fundamentals.  In the first, I described how I met a VP of Operations who, in spite of having an ERP with scheduling functionality in it, is struggling to answer these questions, which I call the 3 Shop Floor Fundamentals:

  1. What job should I work on next (shop-wide, or in any dept/work center)?
  2. Where is the job, how is it progressing?
  3. How can I tell my customer – with confidence! – when they’re going to get their order?”

In this blog, I’ll discuss the first question, “What job should I work on next?”.  Put another way, “How do I know what job is most important to be worked on right now?”  This is about establishing a priority system, and having the discipline to follow it.  But no priority system will be followed for very long unless the folks executing the priorities trust them.  And that means they understand the priorities, how they’re established, and believe that following the priorities are the best thing they can do for themselves, their company, and their company’s customers. 

The Importance of Having a Priority System

To emphasize the importance of having a priority system and following it, let’s go back to middle school health class.  As the shop floor is truly the heart of your company, let’s consider an analogy between the human body’s circulation system and a prioritization system in your company.

In middle school health class, we learned that the heart keeps blood flowing, but it’s really in the lungs where “value is added” by re-oxygenating the blood, so the heart can send that O-2 out to the brain, organs, and other parts of the body. 

Imagine if the heart decided it didn’t feel like sending oxygen-depleted blood over to the lungs today; instead it wanted to send it down to, say, the liver.  Or, imagine if the lungs weren’t in the mood to process any more de-oxygenated blood, and took whatever incoming it got, and made it wait under a table, while it processed the already fully-oxygenated blood just a little more.

Surely, that person’s body would likely have some significant health problems; best case, it just wouldn’t be as healthy and feeling as good or strong as it could possibly be.  Worst case, well, you get the picture.

Is the oxygen (value add) getting to your jobs in your shop when it needs it most?  Or do you have work centers that are starving some jobs at the expense of others that may already have “sufficient oxygen”?

Do you have jobs that get ‘trapped’ or forgotten about in a workcenter or at an outside service, work that becomes more and more “oxygen-depleted” (at risk of being, or already, late) as attention is diverted to other less urgent work?

Are you using your shop’s “lungs” – (machine and personnel capacity to add value) on the right jobs at the right times?  Could your company be healthier if it did?

The design of the human body’s circulation system is a closed, tight loop;  so the flow of blood is essentially predetermined; which makes our analogy silly, but helpful.  Helpful in pointing out that because the flow of all the material/jobs/work orders in your manufacturing shop floor is anything but predetermined, it is critical to the strength and health of your company that a strong priority system is put in place.  The right priority system is going to ensure that each of your jobs, regardless of where they are – pre-release, or at any workcenter along its routing – gets the “oxygen” (value-added attention) it needs, when it needs it.

How are Work Orders Prioritized today in your shop?

You may think you know, or have an idea of how jobs are being prioritized on your shop-floor, but is that what’s really happening?  When was the last time you took an order or two and followed their path and tracked the decisions being made at each workcenter?  The results may surprise you.

Priorities are often over-ridden at the workcenter or individual machine level for a number of reasons, many of which seem to make sense at a “local” machine or workcenter level, but may be detrimental to your company’s performance as a whole.  Reasons for priority overrides include the preference of an operator, batching orders to save one or more setups, and managerial fiat.  Some of these may have ‘good intent’ behind them, such as reducing overall processing (setup) time, or calming an angry customer, but these decisions are often made in isolation without the benefit of knowing the overall impact to all the other jobs that need to get through the shop and their customers.

The Danger of Prioritizing by Due Date

With very few exceptions, the production scheduling software you have embedded in your ERP, or bolted-on, uses due date as the priority to produce a schedule.  Similarly, if you’re scheduling using spreadsheets or a manual white board, the priority generally is based on due date.

But if you’re like most (90%+) Manufacturers in North America today, your company is at least partly, and probably fully, custom, make-to-order manufacturing.  What that means is that you will have orders with a later due date, say, 2 months from now, that are more in danger of being late if you don’t get started on them right now, than orders with an ealier due date.  The reason is the varied mix of jobs, that some have just a few relatively short operations, but others have many, longer, more extensive operations, even needing to go outside for processing multiple times, for example.

So, if you work on jobs in strictly due date order, you will be working only on the earlier jobs – making jobs with a later due date even more at risk of being late.  You may be in this situation if you find you’re often having to expedite jobs as they approach their due date. 

With the right priority mechanism, you can avoid the endless expediting and make sure each job is getting the attention it needs when it needs it, so all your jobs get to their customers on-time.

Click here to learn a new approach to shop floor prioritization that is simple, quick and easy to implement, and ensures that you’re working on the right job at the right time..