AAOM Handbook

MS.13 Calculate Ouput Distributions and Confidence Levels

Context

The objective of the Production and Service strategies, and Operating Master Schedule, for a process is to define how to deliver the performance targets at the confidence level required. To determine if the proposed Production and Service Strategies, and Operating Master Schedule, will deliver the required performance we must determine the probability distribution for the output delivered by the optimised Operating Master Schedule. The specification for each Activity in the Operating Master Schedule includes the probability distribution for performance parameters (availability, utilisation, operating rate, quality and efficiency) affected by the Activity. The probability distributions for the process performance that will result from the schedule can be obtained by statistically modelling (e.g. using Monte Carlo simulation) the performance parameter distribution for the process over a period of the schedule. This prediction is consistent with the way we have defined and modelled process performance in Setting Performance Targets from business expectations. Performance predictions for processes can be rolled up in the Business Structure from Productive Unit, Process, Process Stream and Asset performance using the same models that were used in Setting Performance Targets.

Purpose

To estimate the output performance that will result from implementation of the Operating Master Schedule.

Quantity

• one run chart containing the forecast 10th percentile, mean and 90th percentile output of the process for each minimum time scale unit, • one capability histogram of the forecast process output for each reporting interval, • one run chart containing the forecast 10th percentile, mean and 90th percentile demand for each Resource Type for each minimum time scale unit, • one capability histogram of the forecast Resource Type demand for each reporting interval,

Quality

Output forecasts shall be produced for each element and level of the Business Structure identified in the Operating Master Schedule. Forecasts for Productive Unit, Process, Operation and Region shall be produced by combining the

© McAlear Management Consultants 2006

Operational Planning: Set Operating Master Schedule

Updated: August 2018

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