Consolidation of bulk load-out activities at Cargill’s Multiseed plant
IV
Summary
Introduction
Cargill’s Multiseed plant, located in the harbour of Amsterdam, consists of a crush and a refinery. In the crush, mainly sunflower seed, otherwise rape seed, is crushed into meal pellets and crude oil. The refinery only refines crude sunflower oil into refined sunflower oil. All products leave the plant as bulk-product by truck or ship. Currently, four load-out areas are used, two load-out stations for oil trucks and meal pellet trucks and two load-out berths for oil ships and meal pellet ships. All four areas are physically dispersed and load-out operators are required to execute the load-out processes at every location.
It is supposed that the efficiency of the load-out activities can be improved in order to reduce the workload and therefore labour cost. Furthermore, the requirements for the load-out processes are investigated. The research question for this project is therefore: “How to
improve the Load-Out Activities of Cargill’s Multiseed Plant in order to save Costs taking the increased Requirements of Authorities and Clients into account?”
To be able to answer this research question, the current (“As Is”) situation is analyzed first. The As Is Situation is subsequently evaluated with help of a cause-and-effect diagram and a Strength, Weaknesses, Opportunities and Threats (SWOT-) analysis. Improvements have been contrived to deal with the findings of the As Is Situation. In the last step, combinations of these improvements are made to create several concepts.
Results of As Is Situation
The yearly operational costs for the load-out activities have been investigated to find the cost drivers. Labour cost is found to be main cost driver, representing 82% of the total operational expenses of € 905.000. To reduce labour costs, the number of shifts and number of load-out operators per shift can be reduced if the controls of load-out areas are consolidated and time-consuming tasks are automated. Currently, 7 load-out operators together are scheduled for 224 hours a week. The most time-consuming processes are loading meal pellet ships and oil trucks. Besides load-out tasks, regular additional tasks have to de executed by the load-out operators. 43% of the scheduled hours is spare-time. The spread in workload for load-out operators is small since during the busiest week, still 31% of the time consists of spare-time.
Furthermore, the value-added time (i.e. time spent to execute tasks asked for by the client and he is willing to pay for) spent by load-out operators during the load-out of oil trucks is measured to be only 33% of the total process-time of 19 minutes on average. For meal pellet trucks it is only 10% of the average 23 minutes. Exact details for meal pellet ships could not be generated, but the process is comparable with loading meal pellet trucks and value-added time is therefore estimated as 35%. The value-added time to load during the loading of an oil ship is only 22% of the total 90 minutes load-out time.
Besides these load-out operators, guards are involved for the weighing and registration of trucks. Their workload consists of four hours every weekday, besides other tasks like securing the plant, welcoming visitors and answering phone calls.
The other part of the project focuses on the requirements set by stakeholders. Three requirements have a high priority to be fulfilled.
• Clients are of the opinion that the food safety standard at the oil load-out station is suffering.
• The working conditions at the meal pellet berth are not fulfilling the demands of the Dutch Working Conditions Act.
• The dust emission at the meal pellet berth exceeds the restriction set by a new license.
Improvements and Concepts
Solutions have been found by translating the evaluation of the As Is Situation into 11 stand-alone improvements. Part of these improvements fulfils the three requirements set by stakeholders. The other goal of the improvements is to reduce the workload of load-out operators and guards by changing the organization, moving control areas, mechanization and
Consolidation of bulk load-out activities at Cargill’s Multiseed plant
V automation of tasks. Four of these improvements are best available options, found at other plants. For all load-out processes, waste activities can be removed by the improvements. The result is that only the value-added times, as found by the time study, are required to execute the load-out processes. All tasks of the guard can be eliminated by automated systems, outsourcing some of their tasks and providing better communication systems.
Combinations of improvements have led to five concepts, but first a zero concept is given. The zero concept is a risk assessment and consists of six worst case scenarios in case Cargill does not improve the load-out activities.
Concepts 1:
Concept 1 fulfils the requirements of stakeholders and avoids all risks opposed by the zero concepts. It consists of three improvements; upgrading the load-out station for oil trucks by making it a closed building, installing an aspirated loading bellow remotely controlled by camera-vision and automating the valves of the oil storage tanks. The investment is € 483.000, but there are no cost savings.
Concept 2:
Concept 2 is an extension of concept 1, since it consists of the same improvements, but instead of upgrading the load-out station, a new one is placed near the quay next to the meal pellet load-out station. The result is a consolidation of load-out areas, reducing the workload since one load-out operator will be able to load oil trucks and ships and meal pellet trucks or ships simultaneously. Every week 80 man-hours can be saved. The working conditions as well as the food safety at the oil load-out station are improved to a higher extent as by concept 1. The investment will be € 1.3 mln, the yearly savings will be € 169.000.
Concept 3:
Concept 3 eliminates the nightshift for the load-out operators by improving the meal pellet system. A bypass for the meal pellet system makes it possible to load meal pellet ships and trucks simultaneously, which is the current bottleneck. However, some extra improvements are required resulting in an investment of € 820.000 to save only 4 night shifts, being 32 man-hours a week. Concept 3 will furthermore not fulfil any of the requirements.
Concept 4:
Concept 4 eliminates the night and weekend shifts of the guards. Since during these shifts no trucks arrive, the logistic task of the guard is not required. The security is not at stake and a comparable plant in Antwerp has proven that this concept can be implemented. The control room of the plant will need to be equipped with a camera-system for security reasons. Although concept 4 does not fulfil any of the requirements, the investment of € 200.000 is paid back within two years, due to the yearly savings of € 164.000.
Concept 5:
Concept 5 eliminates the day shifts of the guards. The logistic task will be taken over partly by an automated entrance system and partly by the load-out operators. Precondition is that concept 2 and 4 are implemented, since the consolidation of load-out areas is necessary for the load-out operators to execute the logistic tasks. An investment of € 195.000 is required to save € 110.000 every year.
Result of the MCA
These five concepts have been analyzed by a Multi Criteria Analysis (MCA), consisting of six criteria with different weights. The weight factors are defined by pairwise comparison of the criteria. Summing up the relative relevance of each criterion over the other criteria and normalizing the sum of rows results in the weight factors. Two financial criteria, the Net Present Value (NPV) and PayBack Period (PBP) represent respectively 18% and 16% of the weight. Three requirements-of-stakeholders related criteria, being food safety, dust emission reduction and working conditions, represent respectively 30%, 18% and 14% of the weight. The least important criterion, the occupation degree of load-out systems, has a weight of only 6%.
Consolidation of bulk load-out activities at Cargill’s Multiseed plant
VI The best rewarded concept by the MCA is concept 2, since it fulfils the three requirements set by stakeholders to a high degree and has a NPV of € 191.000. However, the PayBack Period (PBP) is nearly 8 years.
Conclusion and recommendations
It is strongly recommended to implement concept 2. The requirement of stakeholders will then be fulfilled and the largest cost saving of labour cost by load-out operators is achieved. For further cost savings, concept 4 and 5 can be implemented after or together with concept 2, in order to reduce the labour cost of guards.
In addition to implementing concept 2, 4 and 5, it is recommended to investigate three other issues that support the performance of load-out activities at Cargill’s Multiseed plant and can be used at all plants where load-out activities take place:
• Establish a Centre of Expertise for load-out processes to share valuable knowledge about these processes in order to reduce costs at other Cargill plants as well.
• Do research on the possibility of an automated load-out process for dry-bulk ship loading. A control system with the input of several sensors might be able to completely automate loading dry-bulk ships.
• Investigate the possibilities of using Radio Frequency Identification (RFID) tags on trucks for easier and faster data communication between truck and plant.
