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Using Cyclic Planning to Manage Capacity at ALCOA

Author

Listed:
  • Edie Schmidt

    (School of Technology, Purdue University, West Lafayette, Indiana 47907-1310)

  • Maqbool Dada

    (Krannert Graduate School of Management, Purdue University, West Lafayette, Indiana 47907-1310)

  • James Ward

    (Krannert Graduate School of Management)

  • Duane Adams

    (ALCOA, Engineering Products Division, Lafayette, Indiana 47905)

Abstract

ALCOA makes aluminum-tubing products to order. The product lines' success caused a backlog of customer orders and long customer lead times. This problem was exacerbated by frequent machine breakdowns at a bottleneck operation. ALCOA implemented cyclic planning to improve capacity management. The results were immediate and dramatic. Over eight months, output increased by over 20 percent, almost eliminating the backlog of customer orders. The cyclic-planning implementation resulted in additional benefits throughout the organization, including improved workforce planning and better machine maintenance scheduling.

Suggested Citation

  • Edie Schmidt & Maqbool Dada & James Ward & Duane Adams, 2001. "Using Cyclic Planning to Manage Capacity at ALCOA," Interfaces, INFORMS, vol. 31(3), pages 16-27, June.
    • Handle: RePEc:inm:orinte:v:31:y:2001:i:3:p:16-27
    DOI: 10.1287/inte.31.3.16.9628
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    References listed on IDEAS

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    1. Milgrom, Paul & Roberts, John, 1990. "The Economics of Modern Manufacturing: Technology, Strategy, and Organization," American Economic Review, American Economic Association, vol. 80(3), pages 511-528, June.
    2. Anantaram Balakrishnan & Stuart Brown, 1996. "Process Planning for Aluminum Tubes: An Engineering-Operations Perspective," Operations Research, INFORMS, vol. 44(1), pages 7-20, February.
    3. Anantaram Balakrishnan & Stuart Brown & Duane Dunlap & Robert Pahl, 1995. "Interdisciplinary Industry-University Collaboration: Lessons from an Operations Improvement Project," Interfaces, INFORMS, vol. 25(5), pages 12-41, October.
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    Cited by:

    1. Apujani, Payal & Dutta, Goutam & Gupta, Narain, 2016. "An Introduction to the Aluminum Industry and Survey of OR Applications in an Integrated Aluminum Plant," IIMA Working Papers WP2016-03-50, Indian Institute of Management Ahmedabad, Research and Publication Department.
    2. van der Vaart, Taco & Wijngaard, Jacob, 2007. "The contribution of focus in collaborative planning for make-to-order production situation with large set-up times," International Journal of Production Economics, Elsevier, vol. 108(1-2), pages 436-443, July.
    3. Goutam Dutta & Payal Apujani & Narain Gupta, 2016. "An Introduction to the Aluminium Industry and Survey of OR Applications in an Integrated Aluminium Plant," Working Papers id:11097, eSocialSciences.
    4. Germs, Remco & Van Foreest, Nicky D., 2011. "Admission policies for the customized stochastic lot scheduling problem with strict due-dates," European Journal of Operational Research, Elsevier, vol. 213(2), pages 375-383, September.

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