Consider two stations in series. Each is composed of a single machine that requires a rather lengthy setup. Large batches are used to maintain capacity. The result is an effective process time of 1 hour per job and an effective CV of 3 (that is, te 1.0 and cz 9.0). Jobs arrive in a steady stream at a rate of 0.9 job per hour, and they come from all over the plant, so Ca = 1.0 is a reasonable assumption. Now, suppose a flexible machine is available with the same capacity but less effective variability (that is, te = 1.0 and ce^2 = 0.25) and can be used to replace the machine at either station. Requied:
At which station should we replace the existing machine with the new one to get the largest reduction in cycle time?