A system dynamics model for total-factor productivity measurement of the manufacturing system: its implications for JIT

Abstract

This research provides a basis to explore the relationship between Just-In-Time (m) and performance of the manufacturing system using a systems approach. Specifically, a conceptual model that captures system-wide performance of the manufacturing system was built using system dynamics in an effort to investigate the relationship between JIT and performance of the manufacturing system. The model was designed and built to measure total-factor productivity (TFP) which represents a global performance measure of the manufacturing system. TFP captures the integrated, synergistic effect of the system variables and functions on global system performance.

A major part of the research was devoted to building and testing the system dynamics model. The model consists of four sectors: production-inventory, labor, machine, and material. The labor, machine, and material sectors represent the input classes used to produce the finished goods. The production-inventory sector contains a variable representing the finished goods (output of the system). It also contains the TFP variable which relates all the input classes and the output, and calculates the TFP value simulated under a specific system state.