The Hickory Flat Sawmill (HFS) makes four kinds of lumber in one mill. Orders come from a variety of lumber companies to a central warehouse. Whenever the warehouse hits the reorder point, an order is placed to HFS. Pappy Red, the sawmill manager, has set the lot sizes to be run on the mill on the basis of historical demands and common sense. The smallest amount made is a lot of 1,000 board-feet (1 kbf). The time it takes to process a lot depends on the product, but the time does not vary more than 25 percent from the mean. The changeover time can be quite long depending on how long it takes to get the mill producing good product again. The shortest time that anyone can remember is 2 hours. Once it took all day (8 hours). Most of the time it takes around 4 hours. Demand data and run rates are given in Table 15.10. The mill runs productively 8 hours per day, 5 days per week (assume 4.33 weeks per month). 

The lot sizes are 50 of the knotty 1 x 10, 34 for the clear 1 x 4, 45 for the clear 1 x 6, and 40 for the rough plank. Lots are run on a first-come, first-served basis as they arrive from the warehouse. Currently the average response time is nearly 3 weeks (14.3 working days). 

The distributor has told HFS that HFS needs to get this down to 2 weeks in order to continue being a supplier. 

(a) Compute the effective SCVC for the mill. What portion of c2 is due to the term in square brackets in equation (15.8)? What can you do to reduce it? 

(b) Verify the 14.3-working-day cycle time. 

(c) What can you do to reduce cycle times without investing in any more equipment or physical process improvements?

TABLE 15.10 Data for the Sawmill Problem Parameter Knotty 1 x 10 50 0.2000 Demand (kbf/month) One lot time (hour) Clear 1 x 4 170 0.4000 Clear 1 x 6 45 0.6000 Rough Plank 80 0.1000