Shop Floor Control and Reporting

Shop Floor Control and Reporting: A Comprehensive CPIM Exam Guide

Shop Floor Control and Reporting

Why Is Shop Floor Control Important?

Shop Floor Control (SFC), also known as Production Activity Control (PAC), is a critical function in manufacturing because it serves as the execution layer of the entire planning hierarchy. Without effective shop floor control, even the most carefully developed master schedules, material requirements plans, and capacity plans will fail to deliver results. SFC bridges the gap between planning and actual production by managing the flow of work through the factory, ensuring that orders are completed on time, within budget, and to quality standards.

Its importance can be summarized as follows:

• Execution of plans: SFC translates planned orders into actionable work on the shop floor, ensuring that the output of MRP and CRP is realized.
• Visibility and control: It provides real-time or near-real-time visibility into the status of production orders, work-in-process (WIP), and resource utilization.
• Feedback loop: Reporting from the shop floor feeds critical information back to planners, enabling corrective actions and future planning improvements.
• Cost management: By tracking labor, materials, and machine usage, SFC supports accurate cost accounting and variance analysis.
• Customer service: Timely and accurate execution on the shop floor directly impacts on-time delivery performance and customer satisfaction.
• Continuous improvement: Data collected through SFC reporting enables identification of bottlenecks, inefficiencies, and opportunities for improvement.

What Is Shop Floor Control?

Shop Floor Control is the set of activities, systems, and techniques used to manage the priority and flow of work through a manufacturing facility. It encompasses the release of production orders to the shop floor, the scheduling and sequencing of operations at each work center, the tracking of order progress, and the reporting of completed activities.

Key components of SFC include:

1. Order Release (Dispatching)
This is the process of authorizing and releasing planned orders to the shop floor for execution. Before release, several checks are typically performed:
• Material availability: Are all required components and raw materials available?
• Tooling availability: Are the necessary tools, fixtures, and gauges available?
• Capacity availability: Is there sufficient capacity at the required work centers?
• Documentation: Are routing sheets, engineering drawings, and work instructions ready?

Only orders that pass these checks should be released, to prevent unnecessary WIP buildup and shop floor congestion.

2. Order Scheduling and Sequencing
Once released, orders must be scheduled and sequenced at individual work centers. This involves determining the order in which jobs are processed using priority rules (also called dispatching rules or sequencing rules). Common priority rules include:
• Earliest Due Date (EDD): Jobs with the earliest due date are processed first.
• Critical Ratio (CR): Calculated as (Time Remaining) / (Work Remaining). A ratio less than 1.0 indicates the job is behind schedule.
• Shortest Processing Time (SPT): Jobs with the shortest operation time are processed first, minimizing average flow time.
• First Come, First Served (FCFS): Jobs are processed in the order they arrive.
• Slack Time: Jobs with the least slack (due date minus remaining processing time minus current date) are prioritized.

3. Work-in-Process (WIP) Tracking
SFC systems track the location and status of every production order as it moves through the routing. This includes monitoring:
• Which operation is currently being performed
• Queue times at each work center
• Move times between work centers
• Wait times for tooling, inspection, or other resources

4. Data Collection and Reporting
This is the feedback mechanism that closes the loop between planning and execution. Key data collected includes:
• Operation completions: When each operation on a routing is completed
• Quantities completed and scrapped: Actual output versus planned output
• Labor hours: Actual hours worked versus standard hours
• Machine hours: Actual machine utilization versus planned
• Material usage: Actual material consumed versus bill of materials requirements
• Move transactions: Movement of materials between work centers or to/from stockrooms

5. Input/Output Control (I/O Control)
Input/Output Control is a technique used to manage work center queues and lead times. It compares the planned input and output of a work center with actual input and output over time. Key principles include:
• If input exceeds output, the queue (and therefore lead time) will grow.
• If output exceeds input, the queue will shrink.
• The goal is to keep queues at a planned level that balances flow and utilization.
• Tolerance limits are set so that deviations trigger corrective actions.
• I/O control manages both priorities and capacity at the work center level.

How Does Shop Floor Control Work?

The SFC process follows a logical sequence that can be described as a closed-loop cycle:

Step 1: Planning Phase
MRP generates planned orders based on the master production schedule and bill of materials. CRP validates that sufficient capacity exists. These planned orders become the input to SFC.

Step 2: Order Release
The planner reviews planned orders approaching their release dates and performs availability checks. Orders that pass all checks are released (also called launched or opened). A shop packet is typically created containing:
• Shop order documentation
• Routing information
• Material requisitions or pick lists
• Engineering drawings and specifications
• Move tickets
• Tool requisitions

Step 3: Dispatching
A dispatch list is generated for each work center, showing all released orders queued at or scheduled to arrive at that work center, listed in priority sequence. The dispatch list is the primary tool used by shop floor supervisors to determine what to work on next.

Step 4: Execution and Monitoring
As work is performed, operators and supervisors report progress. The SFC system updates order status, calculates revised completion dates, and flags any orders that are falling behind schedule. Key monitoring tools include:
• Dispatch lists: Updated regularly (often daily) to reflect current priorities
• Gantt charts: Visual representation of scheduled versus actual progress
• Exception reports: Highlight orders that are behind schedule, over budget, or experiencing quality issues
• Anticipated delay reports: Generated by shop floor personnel when they foresee a problem that will delay an order

Step 5: Corrective Action
When problems are identified, corrective actions may include:
• Expediting: Accelerating a specific order through the shop (should be the exception, not the rule)
• Lot splitting: Dividing a lot into smaller quantities so that part of the order can proceed to the next operation while the rest is still being processed
• Operation overlapping: Sending completed units to the next operation before the entire lot is finished at the current operation
• Alternate routing: Using different machines or work centers than originally planned
• Subcontracting: Sending work to an outside vendor to relieve capacity constraints
• Overtime or additional shifts: Increasing available capacity

Step 6: Order Completion and Close-Out
When all operations on a routing are complete and the finished goods are received into inventory (or shipped to the customer), the order is closed. Final reporting includes:
• Actual versus planned costs (labor, material, overhead)
• Actual versus planned quantities
• Actual versus planned lead time
• Scrap and rework data
• Variance analysis for cost accounting purposes

Step 7: Feedback to Planning
Data from completed orders feeds back into the planning system to update:
• Planned lead times
• Standard costs
• Routing and BOM accuracy
• Capacity planning parameters
• Inventory records

Key Concepts You Must Understand for the CPIM Exam

Lead Time Elements:
Manufacturing lead time consists of several elements that SFC must manage:
• Queue time: Time an order waits at a work center before processing begins (typically the largest component of lead time — often 80-90%)
• Setup time: Time to prepare the work center for the operation
• Run time: Actual processing time
• Wait time: Time after processing before the order moves (e.g., waiting for inspection, drying, cooling)
• Move time: Time to physically transport the order to the next work center

Critical Ratio (CR):
CR = (Date Due - Date Now) / Lead Time Remaining
• CR > 1.0: Order is ahead of schedule
• CR = 1.0: Order is exactly on schedule
• CR < 1.0: Order is behind schedule
• CR ≤ 0: Order is already past due

Input/Output Control:
• Planned input should equal planned output to maintain stable queues
• Cumulative deviation is monitored against tolerance limits
• Corrective action is required when deviations exceed tolerances
• Increasing output alone is not always possible — you may also need to reduce input

Push vs. Pull Systems:
• Traditional SFC is a push system — orders are released based on the schedule and pushed through work centers
• Pull systems (like kanban) authorize production based on actual consumption or demand signals from downstream operations
• Many modern environments use a hybrid approach

Reporting Accuracy:
The effectiveness of SFC depends entirely on the accuracy and timeliness of shop floor reporting. Inaccurate or late reporting leads to:
• Incorrect inventory records
• Flawed priority decisions
• Inaccurate cost data
• Poor planning decisions going forward

Exam Tips: Answering Questions on Shop Floor Control and Reporting

Tip 1: Understand the hierarchy. SFC sits at the execution level of the manufacturing planning and control hierarchy. Know where it fits relative to S&OP, MPS, MRP, and CRP. Questions may test whether you understand that SFC executes plans rather than creating them.

Tip 2: Know the order release prerequisites. A common exam question involves identifying what checks should be performed before releasing an order. Remember: material, tooling, capacity, and documentation. Releasing orders without proper checks leads to WIP inflation and longer lead times.

Tip 3: Master the priority rules. Be able to calculate and compare Critical Ratio, Earliest Due Date, Shortest Processing Time, and Slack Time. Practice calculating CR for multiple jobs and determining which job should be processed first. Remember that CR < 1.0 means behind schedule.

Tip 4: Understand Input/Output Control deeply. I/O control is a favorite exam topic. Be prepared to interpret an I/O report, calculate cumulative deviations, and recommend corrective actions. Remember: you can control input by releasing fewer orders, and you can influence output through overtime, additional resources, or process improvements. You cannot increase output beyond demonstrated capacity without making real changes.

Tip 5: Know the lead time elements. Questions may ask you to identify the largest component of manufacturing lead time (queue time) or to calculate total lead time given the individual elements. Reducing queue time is the most effective way to reduce total lead time.

Tip 6: Differentiate between corrective action techniques. Understand when to use lot splitting versus operation overlapping versus alternate routing. Lot splitting divides the batch; overlapping sends partial quantities ahead; alternate routing uses different equipment. Each has different implications for cost and scheduling.

Tip 7: Remember that expediting is a symptom, not a solution. If the exam presents a scenario with excessive expediting, the correct answer is usually to improve the planning and scheduling process, not to hire more expediters. Chronic expediting indicates systemic problems with priority planning or capacity management.

Tip 8: Connect SFC to the closed-loop MRP concept. The exam values your understanding that SFC is part of a feedback system. Data from the shop floor validates and corrects planning parameters. Without accurate feedback, the entire planning system degrades over time.

Tip 9: Pay attention to the role of the dispatch list. The dispatch list is the primary shop floor scheduling tool. It shows the prioritized sequence of jobs at each work center. It is typically generated daily and is more useful than Gantt charts for real-time decision-making on the shop floor.

Tip 10: Understand the anticipated delay report. This report is generated by shop floor personnel (not planners) when they foresee a problem that will cause an order to miss its scheduled completion. It is a proactive communication tool that enables planners to take corrective action before the delay actually occurs. The exam may ask who generates this report and what its purpose is.

Tip 11: Read each question carefully for context. SFC questions often describe a specific scenario — a work center falling behind, queues growing, or orders being late. Focus on identifying the root cause before selecting a corrective action. The CPIM exam rewards systematic thinking over reactive fixes.

Tip 12: Know the difference between scheduling techniques in different environments. Job shops typically use dispatching rules and dispatch lists. Flow shops and repetitive environments may use rate-based scheduling. Process industries may use run-out lists. The appropriate SFC technique depends on the manufacturing environment.

Summary

Shop Floor Control and Reporting is the critical link between planning and execution in any manufacturing environment. It ensures that production orders are released, sequenced, tracked, and completed in a manner that supports the master schedule and customer commitments. For the CPIM exam, focus on understanding order release criteria, priority rules (especially Critical Ratio), Input/Output Control, lead time elements (especially the dominance of queue time), corrective action techniques, and the importance of accurate and timely shop floor reporting as a feedback mechanism in the closed-loop planning system.