Modelling and analysis of dynamic capacity complexity in multi-stage production

The uncertainty associated with managing dynamic capacity problem is the main source of its complexity. This article presents a system dynamics approach to model and analyse operational complexity of dynamic capacity in multi-stage production. The unique feature of this approach is that it captures the stochastic nature of three main sources of complexity associated with dynamic capacity. These are the demand, internal manufacturing delay and capacity scalability delay. The developed model was demonstrated by an industrial case study of multi-stage printed circuit board assembly line. The analysis of simulation experiments showed that ignoring complexity sources can lead to wrong decisions concerning both scaling levels and backlog management decisions. In addition, a general trade-off between the controllability and complexity of the dynamic capacity was illustrated. Finally, comparative analysis of the effect of each of these sources on the complexity level revealed that internal delay has the highest impact on dynamic capacity efficiency. Guidelines and recommendations for better capacity management and reduction of its complexity are presented.