Integrating targeted cycle-time reduction into the capital planning process

This paper describes the development and application of an integrated static capacity and dynamic simulation analysis methodology for purchasing equipment capacity. The goal of the study is to address targeted cycle time objectives in a start up recording head wafer manufacturing facility at Seagate Technology, Minneapolis, MN. The short product cycle time, coupled with the competitive nature of the disc drive industry, has made cycle time reduction one of the most important objectives of production capacity planning. This paper describes an equipment procurement strategy in which static capacity analysis is used to identify an initial equipment set with a low slack capacity variable on each tool group. Simulation analysis is then used to identify the critical tool groups that contribute to cycle time delays. The Seagate Industrial Engineering team used the simulation analysis tool Factory Explorer(R) from Wright, Williams and Kelly to perform the cycle time reduction analysis. This targeted approach is compared to the traditional static capacity planning approach of globally applying reserve capacity buffers of 20% or more to achieve the same cycle time reduction goal. Overall, the targeted approach has proven to be efficient in terms of minimizing capital equipment expenditures and also effective on the factory floor.