Factory Physics

Citation

Hopp, W. J., & Spearman, M. L. (2011). Factory Physics (3rd ed.). Waveland Press.

Chapter Summary

The book runs to about 700 pages in three parts, plus an introductory Chapter 0. Its organizing idea is stated in Chapter 0: a focus on manufacturing management, a scope of operations, a method (factory physics) of describing production systems with general laws, and a perspective of flow lines. Part I surveys the history of manufacturing management and its methods, Part II builds the "science," and Part III applies it to planning and control. Most chapters end with discussion points, study questions or problems, and several have appendices.

Chapter 0: Factory Physics?

Gives a short and a long answer to the title question. The long answer sets out the focus (manufacturing management), scope (operations), method (factory physics) and perspective (flow lines), and ends with an overview of the book.

Part I: The Lessons of History (Chapters 1–5)

Chapter 1: Manufacturing in America. The American experience from the first industrial revolution through the railroads, mass retailers, Carnegie and Ford, scientific management (Taylor and others), the rise of the modern manufacturing organization (Du Pont, Sloan, Hawthorne, management education), and the later peak, decline and resurgence of American manufacturing. Chapter 2: Inventory Control: From EOQ to ROP. The economic order quantity model and its extensions, dynamic lot sizing (the Wagner–Whitin procedure), and statistical inventory models: the news vendor, base stock and (Q, r) models. Appendices review basic probability and collect inventory formulas. Chapter 3: The MRP Crusade. Material requirements planning (inputs and outputs, procedure, lot sizing, safety stock, problems), MRP II and its planning hierarchy, and enterprise resources planning and supply chain management with advanced planning systems. Chapter 4: From the JIT Revolution to Lean Manufacturing. The origins and goals of just-in-time, implementing it, total quality management, pull systems and kanban, and the move from JIT to lean. Chapter 5: What Went Wrong. Takes up the problem and the solutions tried so far (scientific management, the rise of the computer and other "scientific" approaches), and ends by asking where to go from here.

Part II: Factory Physics (Chapters 6–12)

Chapter 6: A Science of Manufacturing. The roots of a science of manufacturing, strategic and operational objectives, models and performance measures, and a methodology for improvement; an appendix covers activity-based costing. Chapter 7: Basic Factory Dynamics. Definitions and parameters, simple relationships among throughput, work in process and cycle time, and labor-constrained systems. Chapter 8: Variability Basics. Variability and randomness, process time variability and its causes, flow variability, variability interactions through queueing, blocking and variability pooling. Chapter 9: The Corrupting Influence of Variability. Variability laws, flow laws, batching laws, cycle time, the effect of variability on performance, and diagnostics and improvements. Chapter 10: Push and Pull Production Systems. Perceptions of pull, why pull works, CONWIP, and comparisons of CONWIP with MRP and with kanban. Chapter 11: The Human Element in Operations Management. Basic human laws, planning versus motivating, and responsibility and authority. Chapter 12: Total Quality Manufacturing. Views of quality, statistical quality control, Six Sigma, and quality in operations and in the supply chain.

Part III: Principles in Practice (Chapters 13–19)

Chapter 13: A Pull Planning Framework. Disaggregation, forecasting, planning for pull and hierarchical production planning, with a quota-setting model in an appendix. Chapter 14: Shop Floor Control. General considerations, CONWIP configurations, other pull mechanisms and production tracking, with statistical throughput control in an appendix. Chapter 15: Production Scheduling. Scheduling within the pull framework. Chapter 16: Aggregate and Workforce Planning. Planning at the aggregate level, including workforce decisions. Chapter 17: Supply Chain Management. Reasons for holding inventory, managing raw materials, work in process, finished goods and spare parts, and multiechelon supply chains. Chapter 18: Capacity Management. The capacity-setting problem, modeling and analysis, modifying existing lines and designing new ones, and capacity allocation and line balancing. Chapter 19: Synthesis—Pulling It All Together. The importance of details, implementation, teamwork, a "factory physics parable," and the future.

Key Concepts

Part I

• EOQ, base stock and (Q, r) models: the classical inventory models and their statistical extensions.
• MRP, MRP II and ERP: the lineage of push-based planning systems.
• JIT, TQM and lean: the Japanese-inspired alternatives, with kanban as a pull mechanism.

Part II

• Throughput, work in process and cycle time: the quantities related by simple laws of factory dynamics.
• Variability and queueing: process-time and flow variability and how they interact to lengthen cycle time.
• Variability, flow and batching laws: the named laws the book builds.
• CONWIP: the pull system the book compares with MRP and kanban.

Part III

• Pull planning framework: forecasting and hierarchical planning organized around pull.
• Aggregate planning and capacity management: planning at the plant and line level.
• Supply chain inventory: raw materials, work in process, finished goods, spare parts and multiechelon systems.

Critical Analysis

Strengths

• A principled approach. Part II sets out laws linking throughput, work in process, cycle time and variability, so that practices such as pull, batching and buffering are explained, not just described.
• History first. Part I traces how inventory models, MRP and JIT developed and ends with a chapter titled "What Went Wrong," which motivates the science that follows.
• Chapters that go from theory to practice. Part III applies the laws to planning, shop floor control, scheduling, aggregate planning, supply chains and capacity, and closes with a synthesis chapter.
• Quantitative apparatus. Probability review, inventory formulas and problem sets at the end of chapters support the quantitative treatment.

Limitations

• Mathematical and probabilistic prerequisites. Chapter 2 comes with a probability appendix and Chapters 8 and 9 deal with variability and queueing, so the later chapters assume comfort with probability and statistics.
• Manufacturing focus. Chapter 0 states the focus as manufacturing management and the perspective as flow lines, so readers whose interest is elsewhere in operations will find a narrower frame than in a general text.
• Long. Seven hundred pages with 20 chapters is more than one course covers.
• A long approach to the core. Part I takes up roughly 180 of the 700 pages before the laws of Part II begin, though it can be read selectively.

Where It Fits in the Course

This is the quantitative, principles-based book in the operations management list. Operations Management (Slack), Operations and Supply Chain Management (Heizer) and Operations Management: Processes and Supply Chains are broad textbooks on operations and supply chains, and are the natural first reading. Essentials of Supply Chain Management is a compact practitioner introduction, and Chopra's Supply Chain Management: Strategy, Planning, and Operation is an advanced, spreadsheet-based treatment of the supply chain as a whole.

Factory Physics complements these by concentrating on how production systems behave, in Chapters 7 to 10 on factory dynamics, variability and pull. Read it after a survey course, and use Chapter 17 together with Chopra for supply chain material.

How to Use This Book

It expects comfort with probability, basic statistics and calculus, and some exposure to operations management.

• Core: Chapter 0, then Chapters 6 to 10, the heart of the science (objectives, factory dynamics, variability, push and pull).
• Background: Chapters 1 to 5 can be skimmed or read as needed; Chapter 2 supplies the inventory models that later chapters use.
• Application: Chapters 13 and 14 for planning and shop floor control, then 15 to 18 by interest, and Chapter 19 to bring them together.
• Practice: the discussion points, study questions and problems at the end of chapters.