ISEN 370: Production Systems Engineering

Free Advice

I took the graduate level version of ISEN 370 with Dr. Graul during the Fall 2023 semester. Here is some advice for ISEN 370/615:

• Dr. Graul loves very length slide decks; don't let them overwhelm you. Understand the main concepts and move on and come back to slides when you don't understand one--they often test very detailed information that is not always mandatory to know. 

• The forecasting models at the start of this class build on each other: moving averages become exponential smoothing models when adding the alpha constant (it's just a weighted moving average). Likewise, exponential smoothing becomes Holt's method when adding a second smoothing value; Holt's becomes Winter's method when you add seasonality factors. The root equations stay essentially the same. 

• ISEN 370 starts linking concepts from other core ISEN classes together, especially ISEN 340. There will be a lot of discussion on queueing models. 

• When using the incremental discount method to determine the optimal order quantity, don't forget that the set-up cost will change between the increments (see Quick Guide 8 for the proof and theory). 

Quick Guides

Quick Guide 1: Learning & Experience Curves

Contains key points on the learning curve concept and formula, the rate which cost declines, the linear transformation of learning curves, and experience curves. 

Quick Guide 2: Forecasting Intro, Demand Decomposition, & Error

Contains key points on the differences between subjective and objective forecasting models, breaking demand into trends and seasons, additive and multiplicative decomposition models, types of forecast error (MAD, MFE, MSE, and MAPE) and their calculations, and tracking signals. 

Quick Guide 3: Time Series Forecast Techniques

Contains key points on stationary time series and the theory/examples on how to create a forecast using the following models: moving averages, exponential smoothing, Holt's method, and Winter's method. 

Quick Guide 4: ARIMA Models

Contains key points on constructing ARIMA models, autocorrelation coefficients, partial auto-correlation function, the autoregressive term (P), the differencing parameter (D), the moving average model (Q), ARIMA model notation, and step-by-step instructions how to identify which ARIMA model should be used.  

Quick Guide 5: Decision Making & Delphi Method

Contains key points on subjective forecasting models, cognitive bias in forecasting, Thinking System 1 vs 2, how to prevent noise in judgement, and the Delphi method and steps.

Quick Guide 6: Production Systems Planning

Coming soon!

Quick Guide 7: EOQ Inventory Policy

Contains key points on classifying types of inventory, the ABC inventory classification system, the key components to an inventory policy, graphical solutions to the EOQ, 

the definition/ formulas for EOQ, total cost, holding cost, average annual holding and set-up costs, reorder point, and lead time.

Quick Guide 8: EPQ & Quantity Discounts

Contains key points on how the EOQ is affected by in house production, definitions/ formulas for the production rate, time between production runs, downtime, uptime, maximum inventory level. Additionally, this quick guide explains the theory and shows the step-by-step procedure for all-units and incremental discount models. 

Quick Guide 9: Resource Constraints

Contains key points on limitations on when the EOQ can be used, how to find the next best inventory solution given a budget constraint or storage constraint, using Lagrangian multipliers, and the average annual cost for producing a certain amount of products with a given cycle time.

Quick Guide 10: Power of 2 & Economies of Scope and Scale

Coming soon!

Quick Guide 11: Single Period Stochastic Inventory Model (Newsboy Problem)

Coming soon!

Quick Guide 12: Q&R Models, Lot Size-Reorder Point Systems

Coming soon!

Quick Guide 13-16

Coming soon!

Quick Guide 17: Dependent Lot Size Schemes

Coming soon!