Delft University of Technology
FACULTY MECHANICAL, MARITIME AND MATERIALS ENGINEERING
Department Marine and Transport Technology Mekelweg 2 2628 CD Delft the Netherlands Phone +31 (0)15-2782889 Fax +31 (0)15-2781397 www.mtt.tudelft.nl
This report consists of 50 pages and 10 appendices. It may only be reproduced literally and as a whole. For commercial purposes only with written authorization of Delft University of Technology. Requests for consult are only taken into consideration under the condition that the applicant denies all legal rights on liabilities concerning
Specialization: Transport Engineering and Logistics
Report number: 2016.TEL.8076
Title:
Tracking reusable packaging
materials
Author:
E.W.L.A. van Bodegom
Title (in Dutch) Tracking herbruikbare verpakkingen
Assignment: Masters thesis Confidential: Yes
Initiator (university): Prof.dr.ir. G. Lodewijks
Initiator (company): D. Koterba, MBA (VDL Nedcar, Born) Supervisor: Dr. W.W.A. Beelaerts van Blokland
T
U
Delft
FACULTY OF M E C H A N I C A L , M A R I T I M E AND M A T E R I A L S E N G I N E E R I N GDelft University of Technology Department of Marine and Transport Technology
Mekelweg 2 2628 CD Delft the Nethedands Phone +31 (0)15-2782889 Fax +31 (0)15-2781397 www.mtt.tudelft.nl Student: Supervisor (TUD): Supervisor (Connpany):
E.W.L.A. van Bodegom Dr. W.W.A. Beelaerts van Blokland D. Koterba, I^IBA (VDL Nedcar, Born) Assignment type: Creditpoints (EC): Specialization: Report number: Confidential: [faster project 35 TEL 2016.TEL.8076 Yes until: 23-11-2019
Subiect: Tracking r e u s a b l e packaging materials
VDL Nedcar is a car manufacturer located in Born (NL) and is currently assembling two types of MINI'S on behalf of BMW, of which the second type started production at November 2015. Nedcar's suppliers are selected by BMW who is technically also owner of the car (parts) during manufacturing. For both environmental and financial motives, BMW has invested over recent years in durable and reusable packaging materials. Around 500 suppliers individually pool these packaging materials and use them when transporting their products to Nedcar, i.e. for 85% - 90% of the orders. After receiving these products and packaging materials at inbound logistics, the packaging materials are send back to the suppliers based on future demand of packaging material.
Figure 1: Reusable packaging materials
Problem definition:
VDL Nedcar has acknowledged having issues with tracking its packaging materials effectively, which has negative effect on both operations and cost (Nedcar, 2015). Synchronizing its physical flow of packaging materials with its corresponding flow in the information system is currently insufficient. When the tracking system of reusable packaging materials is unreliable in case of VDL Nedcar, they risk having packaging material shortages at its suppliers (Nedcar, 2015). Although some packaging materials are specifically developed for a specific product, suppliers may be forced to use alternative packaging materials which can lead to damages and quality issues. Which on its turn can result in customer complaints and claims. In other situations suppliers are not able to supply at all, or will use non-durable packaging materials instead, which increases operational cost (Nedcar, 2015). At the same time Nedcar is about to invest in these durable packaging materials. Manufacturing of a third type of MINI at Nedcar is scheduled for November 2016, increasing the flow of reusable packaging materials.
T
U
Delft
FACULTY OF M E C H A N I C A L , M A R I T I M E AND M A T E R I A L S E N G I N E E R I N GDepartment of Marine and Transport Technology
Delft University of Technology
Mekelweg 2 2628 CD Delft the Netherlands Phone +31 (0)15-2782889 Fax +31 (0)15-2781397 www.mtt.tudelft.nl
Based on the problem definition, the following research objective can be formulated:
Develop an improved tracking system of reusable packaging materials in order to minimize differences between the actual stock levels and the expected stock levels according to the information system at both VDL Nedcar and supplier
In order to satisfy the research objective, research questions are formulated. The main research question is formulated which is substantiated with four research sub-questions.
The following main research question is formulated:
What are the design characteristics of a tracking system for reusable packaging materials?
A substantiated answer on this main research question is found by answering the following four sub-questions focusing on four different parts of the research:
How is the tracking process of reusable packaging materials executed currently? What is the performance of this process?
What are the strengths and weaknesses of the current state tracking process? What would a new process design look like?
How can this new design be implemented at VDL Nedcar? What is the rate of improvement in terms of reliability and transparency?
The report should meet the requirements as described in the "guidelines for writing reports" of the department.
Tracking reusable
packaging materials
Synchronization of physical process with
information system
Tracking reusable packaging materials
Synchronization of physical process with information system
By
E.W.L.A. van Bodegom
1332996
in partial fulfilment of the requirements for the degree of
Master of Science in Mechanical Engineering at the Delft University of Technology,
to be defended publicly on Wednesday November 23, 2016 at 14:00 PM.
Supervisor: Prof. dr. ir. G. Lodewijks TU Delft
Thesis committee: Dr. W.W.A. Beelaerts van Blokland TU Delft
Dr. ir. M. Godjevac TU Delft
D. Koterba, MBA VDL Nedcar
This thesis is confidential and cannot be made public until November 23, 2019. Report Number: 2016.TEL.8076
Preface
Ever since I was little I have a passion for trucks and cars. During many long rides to my grandmother in the south of the Netherlands when I was a kid, we always travelled along car manufacturer Nedcar in Born. After I got my driver license, I bought my first (classic) MINI, which became a hobby as these little old cars require quite some maintenance in order to increase their reliability.
All three elements together made me decide to strive for a research project at VDL Nedcar when possible. With a research proposal from VDL Nedcar about tracking of reusable packaging materials, a perfect match was found between my background and the master track Transport Engineering & Logistics. Being able to perform a research project within a high tech automotive environment and specifically contributing to the end product, the MINI has been a real privilege to me.
The results of the research project about tracking of reusable packaging materials at VDL Nedcar are presented in this report. With this master thesis I complete my master study Transport Engineering & Logistics at the Delft University of Technology.
I could not have completed the master thesis without the help of others. First of all, I want to thank Danny Koterba for giving me the opportunity to conduct my thesis at VDL Nedcar and for his feedback and help during the research. I also want to thank Mart, Frans and all other colleagues from the transport and receipt department at VDL Nedcar, for their time, help and feedback during my stay at VDL Nedcar.
Besides I want to thank my thesis committee, Prof. dr. ir. Gabriël Lodewijks, dr. Wouter Beelaerts van Blokland and dr. ir. Milinko Godjevac for their supervision, feedback and critical questions during my research project, especially during project meetings.
Moreover I want to thank my family, Cynthia and my twin brother Remie for their support and all “good times” we had in Delft. Lastly I would like to thank my parents for their support and motivation during my entire study. Although it had not been easy the last twelve years, you two always motivated me to go on and strive for becoming “ingenieur”.
Emiel van Bodegom Delft, november 8, 2016
Summary
VDL Nedcar is a car manufacturer located in the Netherlands. As a contract manufacturer, VDL Nedcar is currently assembling two types of MINI’s on behalf of BMW. Parts required to assemble these cars are transported in reusable packaging materials between suppliers and VDL Nedcar. VDL Nedcar is having issues with tracking its packaging materials effectively.
This research focuses on tracking of reusable packaging materials at VDL Nedcar. As VDL Nedcar experiences problems in tracking reusable packaging materials effectively, the following research objective is formulated:
Develop an improved tracking system of reusable packaging materials in order to minimize differences between the actual stock levels and the expected stock levels according to the information system at both VDL Nedcar and supplier.
To accomplish the research goal, a main research question is formulated, substantiated with four sub-questions. The main research question is:
What are the design characteristics of a tracking system for reusable packaging materials?
The sub questions are: How is the tracking process of reusable packaging materials executed currently? What is the performance of this process? What are the strengths and weaknesses of the current state tracking process? What would a new process design look like? How can this new design be implemented at VDL Nedcar? What is the rate of improvement in terms of reliability and transparency?
The scope of this research focusses on modular packaging materials. Nineteen different types of packaging materials are analyzed. These standardized packaging materials are handled by multiple suppliers and can be interchanged with other BMW plants as well.
In order to provide answers on the research questions in a structured way the Six Sigma method: Define, Measure, Analyze and Control (DMAIC) is used throughout the entire research.
Improvement tools are applied during the research after analyzing multiple process improvement methods from literature, to be able to provide substantiated results. A Failure Mode & Effects analysis is performed to determine improvement opportunities in the current state process of handling reusable packaging materials. A multi criteria analysis is executed in order to rank different alternatives and determine the most promising solution based on predefined criteria’s. Thereby the Analytical Hierarchy Process is applied to perform pairwise comparisons between criteria’s as well as between alternatives. A feasibility study is performed via Cost- Benefit Analysis.
The research focuses first on the current state process. This process is divided into a physical tracking of reusable packaging materials and a corresponding information system, used to control the handling of reusable packaging materials. Tracking of reusable packaging is performed at two moments, at departure from VDL Nedcar and at arrival at VDL Nedcar. The location switches of the analyzed packaging materials are updated in the information system at those two instants in the process. The performance of the current state tracking process is determined from the control mechanisms used to synchronize the physical location of packaging material with the expected location according to the information system. The results of the performance analysis present low response rates of suppliers on the control mechanisms, and a significant number of performed stock level changes caused by unreliable tracking of packaging materials.
As the performance of the current state tracking process does not give insight in the causes of unreliable tracking of reusable packaging materials, a risk analysis, Process Failure Mode and Effects Analysis, is performed. The PFMEA identifies the performance between the different process steps of the tracking process. The results showed that tracking of incoming shipments present a high risk level compared to the other process steps. This is caused by time pressure which affects the tracking accuracy. Another cause is found in incorrect shipment details of an incoming shipment used to verify the physical tracking process. A combination of omitting physical tracking and incorrect shipment details lead to mismatches as the shipment details are updated in the information system by default.
From the analysis of the current state tracking process can be concluded that the tracking system for reusable packaging materials performs ineffective. Especially tracking of incoming shipments is unreliable. Effects in terms of an unreliable information system due to unreliable tracking cannot be corrected effectively as the response rate of suppliers on the control mechanisms is insufficient. Improvement opportunities are focusing specifically on physical tracking of incoming shipments and on the correctness of the supplied information about reusable packaging materials of an incoming shipment. The process improvements are divided into physical tracking technology alternatives and improvements of the information system.
Four different types of tracking technologies are described: Barcode, RFID, GPS and Weighing of items. The most promising tracking technology is determined via a Multi Criteria Analysis. Both RFID technology and GPS technology scored highest. To determine the most suitable tracking technology out of these two tracking technologies, a feasibility study is performed in order to analyze viability of both tracking technologies from a financial perspective. The results displayed that RFID technology is viable and GPS technology not, as the running costs exceeds the gained benefits in case GPS is applied. Therefore GPS technology will never become profitable in this application.
Two alternatives are proposed to improve the current state information system. The first alternative represents an additional reference on packaging material content of a shipment via an Advance Ship Notice. By verifying this information with the unloading list, an additional check on correctness of the incoming packaging material shipment is performed. Differences between the two independent information sources results in special attention while tracking this incoming shipment at VDL Nedcar. The second alternative is a shared information system between VDL Nedcar and Supplier. Real time insight in current stock levels and incoming and outgoing flow of packaging materials will increase transparency as expected differences can be checked real time and causes can be analyzed easier while all information is presented within the same information system.
The recommended future state tracking process consists of a tracking system using RFID technology and a verification between the existing unloading list and shipment details from the supplier via an ASN. By verifying in total three different information sources about a specific incoming packaging material shipment, tracking performance and reliability will increase significantly. The verification will increase transparency of the control process while differences among the three independent information sources already indicates what causes this difference, in order to prevent these differences in future shipments. Last stage of the research focusses on the implementation of the future state tracking system at VDL Nedcar. Steps required to implement RFID technology are presented, as well as the implementation steps of verification of information in the information system.
To validate whether the future state tracking system will fulfil the research objective, a pilot study is performed. This pilot focusses on the accuracy increase from implementing the verification of the unloading list information with the ASN information. The pilot was based on count report data which represented differences in stock levels of packaging materials due to unreliable tracking. The results of the pilot show that a significant number (82%) of the differences could have been detected via a mismatch between the ASN and unloading list.
It can be concluded that the implementation of the improved information system would increase tracking reliability drastically. This implementation combined with RFID technology used for tracking of reusable packaging materials will significantly increase the reliability of the future state tracking system.
Referring back to the formulated main research question: What are the design characteristics of a tracking system for reusable packaging materials? The following answer can be formulated based on the results of the performed research.
The design characteristics of a tracking system for reusable packaging materials can be divided into physical tracking and a corresponding information system. The recommended physical tracking technology is found in RFID technology. The information system verifies shipment details about packaging materials from two independent sources, the unloading list according to the packaging instruction and ASN information generated by the supplier. A combination of both systems result in an information verification out of three independent sources, significantly improving tracking reliability.
Contents
Summary ...
IList of Figures ...
VList of Abbreviations ...
VII Define ... 1
1 Introduction ... 1
1.1. Problem definition ... 1 1.2. Scope of research ... 1 1.3. Research objective ... 2 1.4. Research questions ... 2 1.5. Research approach ... 22 Literature review ... 4
2.1. Lean manufacturing ... 42.1.1. History of Lean manufacturing ... 4
2.1.2. Lean principles ... 5
2.1.3. Lean tools ... 6
2.2. Delft Systems Approach ... 7
2.3. Six Sigma ... 8
2.3.1. History of Six Sigma ... 8
2.3.2. Six Sigma cycle - DMAIC ... 9
2.3.3. Six Sigma tools...10
2.4. Research methods applied to tracking at VDL Nedcar ...10
2.5. Conclusion research methods process improvement ...11
3 Process description ... 12
3.1. Physical process ...12
3.2. Information flow corresponding to the physical process ...14
3.3. Conclusion current state process description ...16
II Measure ... 17
4 Performance current state process ... 17
4.1. Annual stock taking 2015 ...17
4.2. Monthly count reports 2015 ...20
4.3. Conclusion current state performance ...21
III Analyze ... 23
5 Failure mode & Effects Analysis ... 23
5.1. PFMEA description ...23
5.2. PFMEA procedure ...24
5.3. Failure modes PFMEA ...25
5.4. PFMEA session ...26
5.5. PFMEA results ...27
5.6. Conclusion PFMEA ...29
IV Improve ... 31
6 Design of future state process ... 31
6.1. Physical tracking reusable packaging materials ...31
6.1.1. Suitable technologies for tracking packaging material ...31
6.1.2. Analyzing tracking technologies – Multi Criteria Analysis ...33
6.2.1. Improvement alternatives ...36
6.2.2. Analyzing improvement alternatives ...37
6.3. Monitoring points future state tracking process...37
6.4. Recommendation process improvements ...39
6.5. Feasibility study - Cost-Benefit Analysis ...39
6.6. Conclusion future state tracking process ...42
7 Implementation at VDL Nedcar ... 43
7.1. Implementation physical tracking technology ...43
7.2. Implementation improved information system ...43
7.3. Performance future state tracking process ...44
7.3.1. Failure mode scenarios ...44
7.3.2. Accuracy ASN information ...46
7.4. Conclusion implementation future state process ...47
V Control ... 49
8 Conclusion & recommendations ... 49
8.1. Conclusions ...49
8.1.1. Current state tracking system for reusable packaging materials ...49
8.1.2. Future state tracking system for reusable packaging materials ...49
8.1.3. Implementation of future state tracking system at VDL Nedcar ...50
8.1.4. Design characteristics tracking system for reusable packaging materials ...50
8.2. Recommendations ...50
Appendix A: Research paper ...
51
Appendix B: KLT & GLT reusable packaging material ...
58
Appendix C: Process flowchart...
63
Appendix D1: RPN Criteria’s ...
64
Appendix D2: Possible failure modes ...
65
Appendix D3: Results calculated RPN ...
70
Appendix D4: Process flowchart prioritized on risk ...
73
Appendix E1: Analytic hierarchy process...
74
Appendix E2: Input data Cost-benefit analysis ...
78
Appendix E3: Stock level differences of packaging materials ...
80
List of Figures
Figure 1.1: DMAIC method – research chapters ... 3
Figure 2.1: The Toyota production system ”House” ... 5
Figure 2.2: Lean implementation tools [3] ... 6
Figure 2.3: The standard deviation of six sigma. ... 8
Figure 3.1: Physical flow packaging materials ... 12
Figure 3.2: Information flow packaging material ... 14
Figure 3.3: Flowchart - process of tracking reusable packaging materials ... 16
Figure 4.1: Response rate on annual stock taking 2015 ... 18
Figure 4.2: Stock level packaging material - annual stock taking 2015 ... 19
Figure 5.1: Worksheet PFMEA session ... 25
Figure 5.2: Boxplot representation of the RPN per possible failure mode. ... 28
Figure 6.1 Prioritized criteria’s determined with AHP ... 35
Figure 6.2: Results multi criteria analysis ... 35
Figure 6.3: monitoring points tracking process of reusable packaging material. ... 38
List of Abbreviations
Abbreviation Explanation
AHP Analytical Hierarchy Process
ASN Advance Ship Notice
CBA Cost – Benefit Analysis
DMAIC Define, Measure, Analyze, Improve and Control
DPMO Defects Per Million Opportunities
EDI Electronic Data Interchange
ERP Enterprise Resource Planning
FMEA Failure Mode & Effects Analysis
GLT GroßLadungsTräger (stillages)
GPS Global Positioning System
KLT KleinLadungsTräger (plastic box)
MCA Multi Criteria Analysis
PFMEA Process Failure Mode & Effects Analysis
RFID Radio Frequency Identification
RPN Risk Priority Number
I
Define
1
Introduction
VDL Nedcar is a car manufacturer located in Born (NL) and is currently assembling two types of MINI’s on behalf of BMW, of which the second type started production at November 2015. Nedcar’s suppliers are selected by BMW who is technically also owner of the car (parts) during manufacturing. For both environmental and financial motives, BMW has invested over recent years in durable and reusable packaging materials. Around 500 suppliers individually pool these packaging materials and use them when transporting their products to Nedcar, i.e. for 85% - 90% of the orders. After receiving these products and packaging materials at inbound logistics, the packaging materials are sent back to the suppliers based on future demand of packaging material.
1.1.
Problem definition
VDL Nedcar has acknowledged having issues with tracking its packaging materials effectively, which has negative effect on both operations and cost (Nedcar, 2015). Synchronizing its physical flow of packaging materials with its corresponding flow in the information system is currently insufficient. When the tracking system of reusable packaging materials is unreliable in case of VDL Nedcar, they risk having packaging material shortages at its suppliers (Nedcar, 2015). Although some packaging materials are specifically developed for a specific product, suppliers may be forced to use alternative packaging materials which can lead to damages and quality issues. Which on its turn can result in customer complaints and claims. In other situations suppliers are not able to supply at all, or will use non-durable packaging materials instead, which increases operational cost (Nedcar, 2015). At the same time Nedcar is about to invest in these durable packaging materials. Manufacturing of a third type of MINI at Nedcar is scheduled for November 2016, increasing the flow of reusable packaging materials. Nedcar shares its suppliers (and their pool of reusable packaging materials) with other BMW car plants whose supply thus relies on the same flow of reusable packaging materials. The same previously discussed issues can arise at these BMW organizations. The process of tracking reusable packaging materials by Nedcar has therefor inter-organizational effects.
1.2.
Scope of research
More than 2000 unique combinations between supplier and packaging material are currently available. Part of these combinations consist of part specific packaging materials, which are handled by a single supplier only. The corresponding flow of packaging materials is relative easily traceable as differences can only occur at either that single supplier or at VDL Nedcar.
Another share of the packaging materials are used for parts of which demand is controlled using a Kanban system. These packaging materials are unloaded and loaded directly on the trailer, at decentral unloading docks. Shipments consist of predefined quantities of packaging materials. Flow of these packaging materials is again relative easily traceable as quantity differences are detected relative easy. This loop of packaging materials is physically separated from the other packaging materials as trailers are unloaded and loaded with the “same” packaging materials at decentral unloading docks.
Most deviations occur at modular packaging materials handled via the central warehouse at VDL Nedcar. Modular packaging materials represent packaging materials with standardized dimensions. These modular packaging materials can be divided into two specific types of modular packaging materials: KLT’s and GLT’s. Five different KLT’s are available and 12 different types of GLT’s. The main difference between KLT’s and GLT’s is the minimal transport quantity. A GLT can be transported in single items, where KLT’s are always placed on a pallet and often covered with a lid. KLT Shipments require at least one layer of KLT’s which varies between two and 16 KLT’s depending on type of KLT. Images of the different KLT’s and GLT’s are presented in Appendix B. The corresponding packaging material number will be used throughout the entire report.
Modular packaging materials are standard packaging materials unless parts will not fit in modular packaging materials. An example is a door penal for which a special packaging material is designed while it would not fit in modular packaging materials. Therefore modular packaging materials are handled by multiple suppliers. These suppliers might also produce car parts for other BMW plants using the same type of modular packaging materials.
Another advantage of modular packaging materials is the size of the pool of modular packaging materials, as demand of packaging materials differs per supplier.
Control of the flow of modular packaging material is impossible when tracking these packaging materials is not accurate. Differences in type and number of packaging material might occur at multiple locations and might affect multiple suppliers. The scope of this research is therefore narrowed to modular packaging materials only.
1.3.
Research objective
Based on the problem definition, the following research objective can be formulated:
Develop an improved tracking system of reusable packaging materials in order to minimize differences between the actual stock levels and the expected stock levels according to the information system at both VDL Nedcar and supplier.
Differences between the expected and actual number of reusable packaging materials at the locations of both VDL Nedcar and Supplier result in “losses” of packaging materials. Effects of these differences can lead to shortages of reusable packaging materials at suppliers and eventually use of non-durable packaging materials or in worse case a production stop at the supplier.
The main deliverable of this research is an improved design proposal to track reusable packaging materials reliably and effectively. A thoroughly analysis of current process of handling reusable packaging materials is therefore required. This analysis will give insight in current performance and strengths and weaknesses of the current state process. Based on the current state process analysis, alternatives are discussed and the best feasible alternatives are proposed for the future state process design.
1.4.
Research questions
In order to satisfy the research objective, research questions are formulated. The main research question is formulated which is substantiated with four research sub-questions.
The following main research question is formulated:
What are the design characteristics of a tracking system for reusable packaging materials? A substantiated answer on this main research question is found by answering the following four sub-questions focusing on four different parts of the research. Next these four research sub-sub-questions are presented:
- How is the tracking process of reusable packaging materials executed currently? What is the performance of this process?
- What are the strengths and weaknesses of the current state tracking process? - What would a new process design look like?
- How can this new design be implemented at VDL Nedcar? What is the rate of improvement in terms of reliability and transparency?
1.5.
Research approach
The research is performed according to the DMAIC method from the six sigma methodology. DMAIC is the abbreviation of: Define, Measure, Analyze, Improve and Control. DMAIC method is specifically suitable for process improvements, as the current state is defined measured and analyzed before improvements are developed and implemented. Each stage must be completed before entering the next stage. Next, all stages of the DMAIC are explained:
Define:
First stage of the DMAIC method is Define. Typically an introduction about the research topic is given, the current state is determined and a problem statement is given. Research goals are defined and to be able to accomplish these goals, research questions are introduced. The define stage is completed with a research approach.
Measure:
The measure stage defines the current state of the process in terms of performance. Data collection and processing of this data is important to determine the current state performance. With a known current state performance it is possible to objectively determine performance changes when improvements are implemented. The current state performance presents valuable information for root cause analysis in the Analyze stage, which is presented next.
Analyze:
Third stage of the DMAIC method is Analyze. Purpose of this stage is to identify possible failure modes and to determine their root cause and effects in order to prioritize these possible failure modes. The current stat performance might present valuable information for identifying possible failure modes, depending on the quality of available data. With the prioritized failure modes known, it is possible to determine process improvement opportunities. These improvement opportunities are used as input for the Improve stage.
Improve:
During the Improve phase different solutions are developed for the improvement opportunities. These solutions encompass different technologies or approaches. The effectiveness and impact of these potential solutions are evaluated, resulting in a single most promising solution. Implementation of this solution is defined in this stage and the improved process is validated via a performance calculation in order to quantify the improvements in performance. The current state performance is used as reference. Control:
Fifth and last stage of the DMAIC method is Control. Goal is to control the improved process such that benefits from the implemented improvements are sustained. In this stage an approach is determined how the improved process can be monitored and controlled. The research is evaluated by answering the formulated research questions via conclusions based on the performed research.
2
Literature review
This chapter presents research methods which could be applied to perform this research structured and effectively. From these methods, the most suitable method is chosen in order to answer the research questions best. Three different types of process improvement methods are analyzed: Lean manufacturing, Delft Systems Approach and Six Sigma. Each method is explained and implementation tools of the research methods which can be applied to this research are discussed.
Goal of this research is to minimize differences between the actual physical number of reusable packaging material items and the expected number according the information system. The research method should at least analyze the current state process. This process must be described in detail. The performance and strengths & weaknesses of the current state process should be described. From this thoroughly analysis of the current state process, improvement opportunities will be derived in order to design a future state process which accomplishes the research goal. The research method should be completed with a validation of the future state process design.
2.1.
Lean manufacturing
The theories of lean manufacturing originate from the Japanese company Toyota. Toyota had developed theories that help to reduce costs and increase speed of the production line. Nowadays these theories are widespread introduced all over the world. In this section a short introduction of the Toyota Production System will be given first, followed by the lean principles. From these lean principles, lean tools are presented that could be applicable in this research.
2.1.1.
History of Lean manufacturing
The fundamentals of what nowadays is called the Toyota Production System originally started around 1896 [1]. Sakichi Toyoda made the Toyoda power loom, on which he invented an automatic stopping device when a thread was broken. Due to this function, the amount of errors in the end-products rapidly decreased while a broken thread had to be fixed immediately. The phenomenon of solving an error immediately and therefore prevent failures later on due to the error is nowadays called Jidoka in the Toyota production system.
Another person which has been important for the fundamentals on which the Toyota production system is based is Kiichiro Toyoda. He introduced a flow production method using a chain conveyor at Toyota Motor Corporation, which had been finalized around 1938. This found its way back in what now is called just in time.
Taiichi Ohno at last is often referred as the ‘father’ of the Toyota Production System. Together with Eiji Toyoda they integrated the fundaments of Sakichi Toyoda and Kiichiro Toyoda. Eiji Toyoda had also studied the rouge facility from Ford in the USA. When Eiji Toyoda visited this facility he mentioned: ’there are possibilities to improve the production system; the current system shows a lot of waste.’ This triggered him to do it differently within their own facilities.
The Toyota Production System from that moment on is graphically interpreted as seen in figure 2.1. As can be seen in figure 2.1, the ‘Toyota production system house’ made by Taiichi Ohno and Eiji Toyoda also includes various methods, for example: standardization, 5S, elimination of waste, visual management and continuous improvement.
Goal of the house is to manufacture products with lowest costs, with the shortest lead time and with the highest quality. In order to reach this goal, two main pillars are determined: Just-in-Time and Jidoka. Just-in-time focusses on production of products based on customer demand. The exact number of products is produced when needed by the customer. The other pillar, Jidoka focusses on mistake proof production. This is achieved via automation with a human touch and preventing, correcting of visualizing mistakes before these mistakes can become errors in the finished product. Continuous improvement is required to pursue perfect implementation of the pillars in order to meet the goal over and over again.
Figure 2.1: The Toyota production system ”House”
2.1.2.
Lean principles
The philosophy of lean can be described with five lean principles [2]. The principles are useful as guidance during implementation of lean improvements. For each of the five lean principles customer’s perception is very important. It starts with the customer’s needs, translated in customer values which needs to be identified. Secondly these values are placed in the right order representing the value stream of the current state process. In order to create a flow focusing only on customer’s values, this value stream is changed such that value flow is created. With an optimized value flow, manufacturers are able to switch from push production to pull production, which means that production satisfied only the demand of products from customers instead of over production due to determined batch sizes, for example. Goal of these lean principles is to manufacture products using value add activities only. As it will not be possible to create a smooth process via value add activities only, necessary non-value add activities are allowed as well, though these activities should be minimized. The five lean principles are presented next.
1. Specify value as perceived by the customer
First lean principle specifies the customer’s needs of a product. As the customer is only willing to pay for satisfying the needs, the needs are translated into value add activities. The value from customers is extremely important as it will influence later principles as the future state process is determined from these customer values.
2. Identify the value stream
The value stream represents all processes required to create a product out of rough materials. The value stream consists of all processes involved, which can be categorized in value add and non-value add processes. A commonly used tool in lean manufacturing to visualize a non-value stream is: value stream mapping. With a value stream map the current state of a process is represented clearly. This is performed by identifying each process step and presenting these steps in the right sequence. Often post-it’s are used to present the process steps. With all post-it’s located on a single sheet, the total value stream is visualized. From this value stream map it is possible to identify the relevance of each step in the process in order to produce the product. The steps can be classified as: value add, necessary non-value add and non-value add (waste). By identifying the relevance of each step and using different colored post-it’s representing the three different relevance levels, all waste in the current state becomes clearly visible.
3. Make the value flow through the value stream
As one of the goals of lean manufacturing is “cut the waste”, all non-value add steps must be removed from the value stream. As mentioned in the second lean principle a value stream map represents all waste clearly. Though all waste of this current state process must be detected first. Lean tools which are often used are the seven wastes of lean, represented by the abbreviation TIMWOOD. These seven wastes focus on:
Transport Inventory Motion Waiting Over-processing Overproduction Defects
These seven wastes originate from the Toyota Production System called Muda. The Toyota Production System also describes two other types of waste, Mura and Muri. Mura represents waste caused by fluctuations in manufacturing quantities and Muri represents waste due to overburden of employees or machines. The lean tool: TIMWOOD can be used to determine all waste.
In order to create an efficient performing process, the remaining process steps should be linked together to create a smooth value flow, without interruptions or bottlenecks. Tools used to create this smooth value flow are for example the Kanban technique.
4. Respond to customer pull
When all waste is removed from the process and value flow is created, the future state of the process is created. The value flow makes it possible to produce and deliver products exactly when needed, which is called just in time. A “pull” of products by the customer is created instead of a push of products by the manufacturer. Minimal batch quantities are not required anymore in order to fulfil expected customer demand resulting in elimination of excessive stock of materials and finished products.
5. Strive for perfection
After the first four lean principles are performed, improvements are made to the process in order to cut waste and produce more efficient. Though after one improvement project the process is not truly lean already. In order to strive for perfection, continuous improvement is required. Lean manufacturing tools as Kaizen can be used to establish continuous improvement.
2.1.3.
Lean tools
To implement the lean philosophy via the five lean principles, multiple tools are introduced. Figure 2.2 represents and overview of commonly used lean tools [4]. Some tools are already mentioned at the lean principles section, for example the value stream map. Other lean tools presented in figure 2.2 which might be applicable for this research are presented in this section.
Figure 2.2: Lean implementation tools [3] TIMWOOD
Eliminating waste during manufacturing is very important according to the lean philosophy. As already mentioned at the third lean principle, three main types of waste can be distinguished from the Toyota
manufacturing. Seven different types of waste can be distinguished, forming the abbreviation TIMWOOD [2]. These seven types of waste are:
Transport Inventory Motion Waiting Over-processing Overproduction Defects
TIMWOOD originated from the Toyota production system. After multiple successful implementations of this tool, an additional type of waste is found: Waste of unused human talent. This waste is discussed in detail, as this type of waste specifically, can be important for the research.
Waste of unused human talent
Employees become specialists of the process as their experience grows each time they perform their work. Therefor the employee gains knowledge about the process which is very useful in solving problems and exploring new alternatives which improves production processes. Waste is created when the employee’s knowledge is not used.
Jidoka
One of the two pillars of the lean production house is Jidoka, as presented in figure 2.1. Two lean tools which implement this Jidoka principle are presented in more detail. These lean tools are: Automation and Poka Yoke.
Automation
Automation from Jidoka perspective stands for ‘automation with a human touch’. In a production environment this term is translated into automation of production, monitored and supervised by an operator. The automation process is performed such that the automated process will detect defects during the process and will stop the production until this defect is repaired. Before the process was automated each operator worked a controlled one machine only. With the automated process it is possible for one operator to control multiple machines at the same time as the operator acts only when defects occur at a machine.
Poka Yoke
When people are involved in the process, mistakes will be made. Even when a person is attended and gives his best effort, errors will be made when repeated work has to be performed. Therefor a lean tool focusing on minimizing these errors is introduced in the TPS: Poka Yoke.
Goal of Poka Yoke design a process such that it is mistake proof. An example of Poka Yoke is the design of an Ethernet cable plug. The shape of this plug is designed such that it can only be plugged in one orientation. It will save both time and money when errors can be prevented or repaired during manufacturing instead of rework required on finished products.
Kanban
The TPS introduced Kanban to lean manufacturing, which directly translated means signboard. This signboard consists of three sections, ‘To do’, ‘Doing’ and ‘Done’. All the tasks are divided over the three sections on the board. In this way an overview is provided regarding all open tasks. With help of this Kanban signboard all details about the current processes of the production line are visualized. More information can be added to the signboard by using colored notes, to which a specific type of process can be assigned, for example. Another type of a Kanban system is the two bin system, used to control the stock level of material and to determine the moment when new materials should be ordered. When one bin out of the two bins is empty the second bin is used and new materials are ordered to fill the empty bin.
2.2.
Delft Systems Approach
Second analyzed research method is the Delft systems approach. This systems approach is primarily used to analyze problem situations within a process. Characteristic is the systems approach, where a system is analyzed by its function. This system represents a transformation of input into output. An example of this transformation is an input of parts into an output realized by a single product. Via a proper model, a system can be analyzed in detail by determining its primary “flow”, the connected order flow and the connected resources flow, required perform the primary “flow”.
The problem is analyzed and the intended function of the system is determined. By zooming in on the system, multiple processes can be distinguished. “In these processes, various process functions are fulfilled for which tasks must be performed. The functions are assigned to certain subsystems.” [4] First the system boundaries are determined. A rich picture is used to analyze the current process and to define all stakeholders involved in the process. With answering the CATWOE questions about the process of interest, the root definitions of the system can be determined. CATWOE stand for: Customer, Actors, Transformation, World view, Owners, Environment constraints. The system is initially described as a black box. Via aggregation layers can be zoomed in on the system itself. The system is determined by its function, which consists of a process and a certain performance. Via a proper model, a system can be analyzed in detail by determining its primary “flow”, the connected order flow and the connected resources flow, required perform the primary “flow”.
2.3.
Six Sigma
The Six Sigma method contains a quality tool which emphasizes the reduction of the amount of errors in a process. Six Sigma focuses on the identification of variance in processes which affect the end result or product, and explores the root causes of the underlying errors. Six Sigma enhances the decrease of the standard deviation of a process to fulfill the requirements of the customer. The relation between those requirements and the quality of the process or service is called critical to quality (CTQ). The used quality tool consists of numerous quality management methods such as statistical methods and is used by specially trained people within the organization which are called either Master Black Belt, Black Belt, Green Belt or Yellow belt, depending on their skills and acquired certificates [5].
2.3.1.
History of Six Sigma
The actual foundation of the Six Sigma theory dates from late 18th century, when Carl Friedrich Gauss introduced the concept of the normal distribution. Such a continuous probability density function shows the probability that any randomly measured variable falls between two real limits. The standard deviation σ defines the amount of variation from the average µ. Figure 2.3 shows such a normal distribution with a couple of standard deviations mentioned. It can be seen that around 68% of the values lie between one standard deviation of the mean [6].
Figure 2.3: The standard deviation of six sigma
The origin of the Six Sigma method lies at the Motorola Company which introduced and developed the terminology and its methods in the early 80s. It was actually an engineer called Bill Smith who decided that after the increasing success of competitive Japanese industry, the method of measuring defects per thousands of opportunities did not provide a sufficient resolution, thus quality within its own company. Instead, he suggested that a new method should consist of measuring defects per million of opportunities.
In fact the defects per million of opportunities became a widely used key performance indicator, defined as:
𝐷𝑃𝑀𝑂 = 1.000.000 ∙ 𝑛𝑢𝑚𝑏𝑒𝑟 𝑜𝑓 𝑑𝑒𝑓𝑒𝑐𝑡𝑠
𝑛𝑢𝑚𝑏𝑒𝑟 𝑜𝑓 𝑢𝑛𝑖𝑡𝑠 ∙ 𝑛𝑢𝑚𝑏𝑒𝑟 𝑜𝑓 𝑜𝑝𝑝𝑜𝑟𝑡𝑢𝑛𝑖𝑡𝑖𝑒𝑠 𝑝𝑒𝑟 𝑢𝑛𝑖𝑡
Where a defect is defined as anything outside of customer specifications. Number of units is the number of units produced and an opportunity is defined as the chance for a defect [7].
values for sigma levels are attained [8].
Table 2.1: The level of Sigma
Sigma Level
Yield [%]
DPMO
1.0
30.9
690000
2.0
62.9
308000
3.0
93.3
66800
4.0
99.4
6210
5.0
99.98
320
6.0
99.9997
3.4
As a result, Motorola decided to develop this method to introduce a quality level of six standard deviations (6σ) which meant that 99,9997% of all values lie within six standard deviations and result in only 3,4 defects per million opportunities.
The goal of Six Sigma is however not to solely achieve a variation of less than six standard deviations, but the improvement of quality of the process or product, in favor of the customer. These developments at Motorola led eventually to an increased customer satisfaction and operating profit.
After the introduction of this method at Motorola, many other companies worldwide were interested in the way Motorola had created the drive for product and organization quality, targeted at reducing errors and defects, to ramp up their customer satisfaction and profits.
2.3.2.
Six Sigma cycle - DMAIC
The Six Sigma method is described by the DMAIC cycle [9]. DMAIC is the abbreviation of: Define, Measure, Analyze, Improve and Control. DMAIC method is specifically suitable for process improvements, as the current state is defined measured and analyzed before improvements are developed and implemented. Each stage must be completed before entering the next stage. Next, all stages of the DMAIC are explained:
Define:
First stage of the DMAIC method is Define. Typically an introduction about the research topic is given, the current state is determined and a problem statement is given. Research goals are defined and to be able to accomplish these goals, research questions are introduced. The define stage is completed with a research approach.
Measure:
The measure stage defines the current state of the process in terms of performance. Data collection and processing of this data is important to determine the current state performance. With a known current state performance it is possible to objectively determine performance changes when improvements are implemented. The current state performance presents valuable information for root cause analysis in the Analyze stage, which is presented next.
Analyze:
Third stage of the DMAIC method is Analyze. Purpose of this stage is to identify possible failure modes and to determine their root cause and effects in order to prioritize these possible failure modes. The current stat performance might present valuable information for identifying possible failure modes, depending on the quality of available data. With the prioritized failure modes known, it is possible to determine process improvement opportunities. These improvement opportunities are used as input for the Improve stage.
Improve:
During the Improve phase different solutions are developed for the improvement opportunities. These solutions encompass different technologies or approaches. The effectiveness and impact of these potential solutions are evaluated, resulting in a single most promising solution. Implementation of this solution is defined in this stage and the improved process is validated via a performance calculation in order to quantify the improvements in performance. The current state performance is used as reference.
Control:
Fifth and last stage of the DMAIC method is Control. Goal is to control the improved process such that benefits from the implemented improvements are sustained. In this stage an approach is determined how the improved process can be monitored and controlled. The research is evaluated by answering the formulated research questions via conclusions based on the performed research.
2.3.3.
Six Sigma tools
Many different tools are suggested in literature which can be helpful at different stages of the DMAIC cycle [10]. This section represents the tools which are sufficient for this specific research. The chosen tools are: Process failure mode & effects analysis, multi criteria analysis and cost benefit analysis. Process Failure mode & Effects Analysis (FMEA)
A PFMEA presents the weaknesses of the process by analyzing each of the process steps. First all possible failure modes are determined per process step [11]. These failures might impact the flow of parts to VDL Nedcar or reduces process reliability of tracking packaging materials. The failure modes are discussed by a group of experts involved in the process. Effects and root cause are determined per failure mode. Next to the cause and effects, risk of failure is estimated per failure mode. By prioritizing the risk of failure for each failure mode per process step, it is possible to distinguish and sort the process steps on risk level and investigate room for improvement. The resulting prioritized process steps show which improvements are important and required in order to decrease the risk level and which failure modes do not affect the process.
The above mentioned risk of failure is expressed via a Risk Priority Number (RPN). This RPN is a multiplication of Severity, Occurrence and Detection, which is determined for each possible failure mode. Multi Criteria Analysis (MCA)
A multi criteria analysis is used to determine the most promising solution out of different alternatives, using multiple criteria’s [12]. Advantage of an MCA is the ability to rank the alternatives on several criteria’s as ecological and economical criteria’s. The weight of these criteria’s can be determined according to importance of that criteria.
An Analytical Hierarchy Process is often used to execute a multi criteria analysis. With pairwise comparisons, the different criteria’s can be weighted among each other. This pairwise comparison is performed per criteria among the different alternatives as well. Finally the weighted scores are multiplied with the weighted criteria’s and the most promising solution is determined.
Cost Benefit Analysis (CBA)
As the MCA determines the most promising solution out of different alternatives, using multiple criteria’s, a cost benefit analysis focusses only on financial aspects of the alternatives [13]. All costs of an alternative are determined and the expected benefits are determined. In order to determine the cost effectiveness of different alternative, a payback period is often determined. This payback period determines the time it takes before an alternative becomes profitable. With a defined limit on the pay-back period, it is possible to rank the different concepts on feasibility from an economic perspective.
2.4.
Research methods applied to tracking at VDL Nedcar
The research focusses on tracking of reusable packaging materials. The process of tracking items consists of determination of the actual location of a specific item. This information can be used for multiple purposes. An example is tracking of a parcel which is ordered in a web shop and delivered to the customer. Via tracking of this parcel, the customer gets insight in the transport process and information about the expected delivery time can be provided, for example. When this ordered parcel was stored at one of the storage facilities of the shop, tracking can be used to identify the location of this parcel as well. When this parcel is identified and send towards the customer, the tracking information can be used for inventory management as it is known exactly when the stock level decreased with one item.
Tracking of reusable packaging materials at VDL Nedcar is used to know the exact location and status of reusable packaging material items in order to control the supply of reusable packaging materials towards suppliers effectively. In the current state process this comes down to tracking of all incoming and outgoing shipments of reusable packaging materials.
Goal of this chapter is to determine the process improvement method which can be applied on this research topic and can be implemented best in order to answer the main research question: What are
the design characteristics of a tracking system for reusable packaging materials? As found from the problem definition, VDL Nedcar is having issues with tracking its reusable packaging materials effectively. Therefore a process improvement method is chosen which analyzes the current state process thoroughly. Based on the results, process improvements are identified, alternatives developed and validated with the purpose of creating an improved future state process which fulfils the research objective.
The Six Sigma DMAIC method is chosen as most suitable research method. Six Sigma focusses on the quality of the output of processes and seeks to improve the quality of this output. This is done identifying and removing the causes of unreliable tracking and by minimizing the variability in quality of tracking of reusable packaging materials. As this research focusses on the quality on the tracking process, the Six Sigma DMAIC method is particularly suitable.
As mentioned in section 2.3.2, the current state process is analyzed first before it is possible to improve this current state process effectively. This analysis is represented by the Define, Measure and Analyze stages. Flowcharts will be implemented to display the current state tracking process clearly and to gain insight in the complexity of the current state process. The PFMEA tool is chosen to determine the strengths and weaknesses of this process. Experts who are involved in the process on daily base are required to investigate the performance of the different process steps and to find the root causes of possible failures effectively, as these experts know the current state process best. Another advantage of the PFMEA is an increase of notion to improve the current state process among the experts, based on the results found during the PFMEA session. The experts become responsible for the entire process instead of only their share of the entire tracking process.
Stages: Improve and Control represent the improvements from current state process to the future state process such that the research objective is met. The Six Sigma tool: Multi Criteria Analysis will be applied to analyze the different improvement alternatives which are based on the current state performance analysis and the PFMEA. A MCA is chosen as the alternatives are ranked on multiple criteria’s and these criteria’s are weighted among each other. Carefully chosen criteria’s will result in an evaluation of the alternatives optimized to VDL Nedcar’s requirements. Lastly a Cost benefit analysis is implemented to verify the viability of the found improvement alternative. This tool is implemented in order to gain insight in the viability of the alternatives from a financial perspective.
2.5.
Conclusion research methods process improvement
After analyzing all presented research methods for process improvement, The Six Sigma DMAIC cycle is found to be the best suitable method for this research.
A future state process which satisfies the research goal and answers the research questions is the deliverable out of this research. With DMAIC it is possible to develop this future state process within one round of the DMAIC cycle. Therefore the current state process is described in detail and characteristics of this current state process are determined via a performance analysis and risk analysis (PFMEA). From these characteristics it is possible to improve the current state process such that a future state process is developed which satisfies the research goal. In order to analyze the presented alternatives best, a MCA and CBA analysis is chosen.
The next chapter presents a detailed description of the current state process of handling reusable packaging materials. In order to understand the current state tracking process best, the entire handling of reusable packaging materials between VDL Nedcar and supplier is discussed. Chapter three is the last chapter of the Define stage of the DMAIC cycle.
3
Process description
To be able to improve the tracking process of reusable packaging materials effectively, it is important to know the current process of handling packaging materials thoroughly. A clear description of the current process of handling reusable packaging materials is presented. Based on this process description, flowcharts are derived, representing this current state process.
The process of handling reusable packaging materials can be divided in two types of flow, a physical flow of packaging materials and its corresponding information flow, presented in the next two paragraphs. The second paragraph is finalized by combining both flows into a single flowchart representing the current state process.
3.1.
Physical process
The physical flow of packaging materials between VDL Nedcar and supplier is presented in figure 3.1. This process starts when a request for empty packaging material is received at the transport department of VDL Nedcar. This request is based on a certain future demand of parts and predefined packaging instruction corresponding to that specific part. A packaging instruction consists of a prescribed number of parts inserted in the packaging material and a prescribed number of packaging materials required for transport. As mentioned in section 1.2, KLT packaging materials may only be transported on a pallet for example. Each packaging instruction present their own specific transport conditions.
Based on this request of empty packaging materials and the number of available empty packaging materials, a transport of empty packaging material towards the supplier is planned. The physical process starts at the central loading dock for empty packaging materials at VDL Nedcar. Next all stages are presented. These stages consists of locations where packaging materials can be located. Transport between the different locations are indicated with an arrow.
1. Central warehouse VDL Nedcar (empty packaging material):
Empty packaging materials are stored in the central warehouse after all parts are separated from its packaging material at the production line. First the packaging material is collected from the production line and located on internal trailers heading to the central warehouse. Modular packaging materials are collected and bundled to pallet size quantities which are determined in the packaging instruction. Internal trailers filled with empty packaging materials are transported to the central warehouse. The empty packaging materials are unloaded and temporarily stored.
To be able to control supply of empty packaging materials effectively, the actual stock levels of packaging materials located at the central warehouse are monitored manually each day.
After a shipment of empty packaging materials is created, this shipment will be transported towards the supplier. At the moment the trailer is ready for departure from VDL Nedcar, the location of that shipment is transferred from VDL Nedcar to supplier in the information system.
2. Supplier (empty packaging material):
Second stage starts when empty packaging material arrives at the supplier. All received packaging materials should be checked on type and amount of packaging materials. Differences must be reported to VDL Nedcar. Empty packaging materials are temporarily stored at the supplier until a shipment of produced parts is inserted in the packaging materials.
3. Supplier (filled packaging material):
After all parts of this shipment are inserted in the empty packaging materials according to the corresponding packaging instruction, this shipment of filled packaging materials is ready for transport towards VDL Nedcar. At the moment filled packaging materials transported from the supplier towards VDL Nedcar, an Advance Ship Notice (ASN) is send towards VDL Nedcar. This ASN present shipment details as the number of delivered parts, part number and supplier details. It is possible to add information about type and amount of packaging materials, though this not required currently.
4. (un)loading dock VDL Nedcar (filled packaging material):
When the trailer loaded with filled packaging material has arrived at VDL Nedcar, this trailer is temporarily stored on the trailer yard of VDL Nedcar. When the parts are required at the production line, this trailer will be transported towards a predefined unloading dock. Each shipment is checked on type and amount of packaging materials and mismatches between supply and demand of packaging materials should be reported and corrected in the corresponding information flow. After a shipment of packaging materials is checked, the location of the packaging materials is switched from supplier account to VDL Nedcar in the information system.
5. Production line VDL Nedcar:
Generally around 85% - 90% of all types of parts enter the production line covered in reusable packaging material. At the production line of VDL Nedcar, parts are separated from its packaging material. When the packaging material is empty, it is collected from the production line and transported to either stage one or stage six, depending on the type of part inserted and packaging material. As already mentioned in chapter 1.2, packaging materials of parts ordered using Kanban system are unloaded and loaded on the same trailer creating a closed loop between stage two and six.
6. (un)loading dock VDL Nedcar (empty packaging material):
Not all empty packaging materials are transported from the production line towards the central warehouse as some types of empty packaging materials are directly reloaded on the trailer at the (un)loading dock. The empty packaging materials are supplied either from a small buffer at the (un)loading dock or directly from the production line. Because a full truck load of filled packaging materials had been unloaded, a full truck load of corresponding empty packaging materials is reloaded on that same trailer. As the trailer is already reloaded with empty packaging materials, the process continues at stage two.
A closed loop is formed between stage one till stage five characterized by the central warehouse. Another loop is formed between stage two till stage six characterized by handling packaging materials via an (un)loading dock only. Modular packaging materials are mainly handled via the central warehouse.
The first mentioned closed loop of packaging materials between stage one and five is less ‘automated’ in a sense that the corresponding flow of information is required for controlling this process correctly.
Many packaging materials handled via the central warehouse are modular packaging materials, used for multiple different parts and handled by multiple suppliers. These supplier might produce parts for other BMW plants, which uses the same type of packaging materials.
When multiple suppliers require empty packaging material and the available stock of empty packaging material at the central warehouse is limited, a substantiated decision is required about the distribution of packaging material amongst suppliers in order to avoid shortages of packaging material at suppliers.
3.2.
Information flow corresponding to the physical process
The information flow corresponding to the physical flow of packaging materials is presented in figure 3.2. All presented stages indicated with numbers represent the physical locations determined in section 3.1. Not each stage in the information system contains information about the packaging material location and status.
Figure 3.2: Information flow packaging material
From figure 3.2 can be seen that information is present at the different stages in the physical process. Different types of packaging materials, noted by a unique packaging material number, are presented. The amount of packaging material items are presented as well. Not each stage presents updates about the packaging materials in the information system. At these stages the information system is not synchronized with the physical process, and the information system becomes less reliable.
To control and synchronize the information flow and physical flow of the packaging material process, monthly count reports and an annual stock takings are performed at VDL Nedcar and its supplier. Aim of the count reports is to synchronize the movements between the information system of VDL Nedcar and the supplier. Discovered differences are analyzed and after consensus is reached about the cause of the difference, stock levels of both VDL Nedcar and supplier are updated. At the annual stock taking, physical stock of packing materials at both VDL Nedcar and supplier are counted and compared to the stock levels gathered from the information system. Again when differences occur, the packaging
