Wallace J. Hopp

CONWIP : A Pull Alternative to Kanban

SUMMARY This paper describes a new pull-based production system called CONWIP. Practical advantages of CONWIP over push and other pull systems are given. Theoretical arguments in favour of the system are outlined and simulation studies are included to give insight into the systems performance.

Commissioned Paper: On the Interface Between Operations and Human Resources Management

Operations management (OM) and human resources management (HRM) historically have been very separate fields. In practice, operations managers and human resource managers interact primarily on administrative issues regarding payroll and other matters. In academia, the two subjects are studied by separate communities of scholars publishing in disjoint sets of journals, drawing on mostly separate disciplinary foundations. Yet, operations and human resources are intimately related at a fundamental level. Operations are the context that often explains or moderates the effects of human resource activities such as pay, training, communications, and staffing. Human responses to OM systems often explain variations or anomalies that would otherwise be treated as randomness or error variance in traditional operations research models. In this paper, we probe the interface between operations and human resources by examining how human considerations affect classical OM results and how operational considerations affect classical HRM results. We then propose a unifying framework for identifying new research opportunities at the intersection of the two fields.

Benefits of Skill Chaining in Serial Production Lines with Cross-Trained Workers

To gain insight into the potential logistical benefits of worker cross-training and agile workforce policies, we study simple models of serial production systems with flexible servers operating under a constant work-in-process (CONWIP) release policy. Two important and interrelated issues are: (a) how to decide which skill(s) are strategically most desirable for workers to gain, and (b) how to coordinate these workers to respond dynamically to congestion. We address these by considering two cross-training strategies: a straightforward capacity-balancing approach, which we call cherry picking (CP), and an innovative overlapping zone strategy that we call skill chaining . Our comparison shows that skill-chaining strategies have the potential to be robust and efficient methods for implementing workforce agility in serial production lines.

Agile Workforce Evaluation: A Framework for Cross-training and Coordination *

This paper outlines approaches for assessing and classifying manufacturing and service operations in terms of their suitability for use of cross-trained (flexible) workers. We refer to our overall framework as agile workforce evaluation. The primary contributions of this paper are: (i) a strategic assessment framework that structures the key mechanisms by which cross-training can support organizational strategy; (ii) a tactical framework that identifies key factors to guide the selection of an architecture and worker coordination policy for implementing workforce agility; (iii) a classification of workforce agility architectures; (iv) a survey of a broad range of archetypical classes of worker coordination policies; (v) a survey of the literature with an operational perspective on workforce agility; and (vi) identification of opportunities for research and development of architectures for specific production environments.

Performance Opportunity for Workforce Agility in Collaborative and Noncollaborative Work Systems

To gain insight into the potential logistical benefits of worker cross-training and agile workforce policies, we study simple models of flexible workers in serial production systems. The primary control issue is how to assign workers to jobs/stations over time. Under assumptions of complete worker flexibility and collaborative work, we prove that a simple expedite policy minimizes along each sample path the cycle time (delay) for each job. Therefore, the expedite policy also minimizes work in process and maximizes throughput along every sample path. We also compute the performance improvement opportunity achievable using flexible workers as opposed to the optimal static allocation of workers. This enables us to examine the factors that make workforce agility a potentially attractive strategy. We also consider the intuitive analog of the expedite policy for the noncollaborative work environment, which we call the pick-and-run policy; however, we demonstrate by counterexample that it is not always optimal. Finally, we extend some of our insights from the demand-constrained environment to a capacity-constrained environment operating under a CONstant WIP (CONWIP) protocol.

Setting WIP levels with statistical throughput control (STC) in CONWIP production lines

We develop a simple adaptive production control method for setting WIP levels to meet target production rates in a pull production operating under the CONWIP (Constant work in process) protocol. This method, termed Statistical Throughput Control (STC), uses real-time data to automatically adjust WIP levels (via kanban cards) in the face of noisy estimates of throughput. Because STC does not rely on a steady-state model, it is well-suited to systems subject to environmental changes such as those induced by continuous improvement efforts. Using simulation, we demonstrate the effectivness of STC under a variety of conditions, including single and multiple products, simple flow lines, routeings with shared resources and assembly systems.

The Impact of Misalignment of Organizational Structure and Product Architecture on Quality in Complex Product Development

Product architecture and organizational communication play significant roles in complex product development efforts. By using networks to characterize both product structure and communication patterns, we examine the impact of mismatches between these on new product development (NPD) performance. Specifically, we study the vehicle development process of a major auto company and use vehicle quality (warranty repairs) as our NPD performance metric. Our empirical results indicate that centrality in a product architecture network is related to quality according to an inverted-U relationship, which suggests that vehicle subsystems of intermediate complexity exhibit abnormally high levels of quality problems. To identify specific subsystems in danger of excessive quality problems, we characterize mismatches between product architecture and organizational structure by defining a new metric, called coordination deficit, and show that it is positively associated with quality problems. These results deepen our understanding of the impact of organizational structure and product architecture on the NPD process and provide tools with which managers can diagnose and improve their NPD systems.

Operations Systems with Discretionary Task Completion

Most performance evaluation models in the operations management literature implicitly assume that tasks possess standardized completion criteria. However, in many systems, particularly service and professional work, judgment is frequently required to determine how much time to allocate to a task. In this paper, we show that introducing discretion in task completion adds a fourth variability buffer, quality, to the well-known buffers of capacity, inventory and time. To gain insight into the managerial implications of this difference, we model the work of one- and two-worker systems with discretionary task completion as controlled queues. After characterizing the optimal control policy and identifying some practical heuristics, we use this model to examine the differences between discretionary and nondiscretionary work. We show that in systems with discretionary task completion, (i) adding capacity may actually increase congestion, and (ii) task variability in service time can improve system performance. This implies that it may be suboptimal to expect shorter delays as a result of a capacity increase, and that task variability reduction may not be an appropriate goal in systems with discretionary task completion. We also find that the benefit of queue pooling is smaller in systems with discretionary task completion than in systems with nondiscretionary task completion.

A model for equipment replacement due to technological obsolescence

We consider the problem of deciding whether to keep a piece of equipment or to replace it with a more advanced technology. This decision must take into account both the nature of the available replacement technology and the possibility of future technological advances. Existing models are restrictive in the way they model the appearance of future technologies and the costs and revenues associated with those technologies. In an earlier paper we allowed the probability of appearance of new technologies to be non-stationary in time but required the costs and revenues of technologies to be different but constant over time. In this paper, we allow the technology forecasts and revenue functions associated with technologies to be non-stationary in time and consider salvage values for technologies. We develop a simple and efficient algorithm for finding the optimal decision using a forecast horizon approach. This approach finds the optimal decision in any period with minimal reliance on forecast data.

Product Line Selection and Pricing with Modularity in Design

This paper addresses the strategic impact of modular design on the optimal length and price of a differentiated product line. We represent consumer demand with a Bayesian logit model. We also break operations costs into product design and production components. Our analysis shows that reducing product development costs via modular design always makes it attractive to offer greater product variety. However, reducing production costs can sometimes motivate a reduction in variety for a risk-averse producer in a multiple-segment market. We also characterize the impacts of degree of modularity and production cost on price markup and market share. Finally, we show that the optimal product line length is monotonic in risk attitude and the monotonic weak majorization, partial order on product assortment.