Organizational Segmentation and Labor Transfer Policies in Labor and Machine Limited Production Systems

This paper describes a simulation study to examine the effects of different organizational structures on the performance of a dual‐constraint job shop production system. A hypothetical shop in which machines and workers are constraining resources is the setting of the study. The shop consists of divisions comprised of work centers which contain machines to which workers are assigned. There are fewer workers than machines. Variations in organizational structure are achieved by segmenting a fixed number of work centers equally into varying numbers of divisions. Mean flow‐time, flow‐time variance, and worker transfers between divisions and work centers are used as performance measures. Changes in organizational segmentation are shown to affect the performance of the production system and the effects are dependent on the extent to which workers can be transferred between the divisions of the system.