How Does Factory Loading Affect
Product Cost and Cycle Time?

Factory loading affects both product cost and cycle time. The closer the factory as a whole runs to its capacity, the lower product costs will be. However, running close to capacity often drives cycle time higher. To examine the tradeoff between capacity loading, product cost, and cycle time, use Factory Explorer®'s Cycle Time Characteristic Curve Chart, shown below for Factory Explorer®'s sample Aspen model (based on data from SEMATECH's set4 testbed dataset). These results were generated using both capacity analysis and simulation.

Cycle Time Characteristic Curve Chart
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Cycle Time Characteristic Curve Chart, Aspen model. This chart quantifies the tradeoff between factory capacity loading, product cost, and cycle time. For this analysis, the toolset is held constant and the start rate is varied. Cycle time rises quickly when the factory is loaded above 85%, while product cost decreases linearly as the loading increases.

The Factory Explorer® Advantage

Factory Explorer®'s cost analysis engine is a comprehensive system that considers costs at all levels - from factory overhead all the way down to process step materials and consumables. This costing engine provides multiple views of the factory's financial health, including detailed product cost and gross margin outputs. Since the chart above can be created automatically from a single run of Factory Explorer®, it's easy to perform sensitivity analysis, where the performance measure in question is the shape of the cycle time curve. The goal is to shift this curve down and to the right, thereby making it possible to run at higher loadings with lower cycle times. With Factory Explorer®, you can test out potential improvements (tool dedication reduction, capital equipment expenditures, staffing changes, etc.) and quickly see the impact not only in terms of cycle time, but also in terms of cost. For the first time, you can easily perform engineering analysis and financial analysis simultaneously.

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