Why is Optimization Important for Supply Chain Planning?

Some problems have clear answers. How much is two plus two? The answer is clearly four. Other problems are not so clear cut. Where should I locate my next warehouse? How should I position inventory to provide a reasonable level of customer service at a reasonable cost? Is it better to ship from the factory to a distribution center via rail or truck? In most cases, there is no single “right” answer to this kind of question; there can be many, or at least several, solutions that are perfectly reasonable, with little or no real difference in terms of the end result.

This ambiguity is central to the world of supply chain planning. As with most other planning and management disciplines, the supply chain offers a constantly changing array of choices where every decision is influenced by multiple factors and has an effect on many different but related aspects of operations. At its core, supply chain planning is often a matter of choosing between customer service (often directly related to speed and/or responsiveness) and cost.

It’s not MRP or DRP

Material Requirements Planning (MRP), and similarly Distribution Requirements Planning (DRP), ignore trade-offs and just apply fixed assumptions and straightforward formulas to lay out a plan for scheduling purchases, production, shipping and inventory levels. Given the same assumptions, these processes will come up with the same answer every time. But that answer can be impractical or impossible to carry out because the calculation relies on fixed assumptions (lead time and lot size, for example, are assumed to be fixed).

MRP might calculate that the factory will need 100 brackets for a production order due to start on March 5, for example, and only 60 are expected to be on-hand and available on that date. The system will recommend buying a standard lot of brackets, say 500, with a due date of March 5 and an ordering date of February 5 since there is an assumed lead time of four weeks. If this plan is laid out on February 15, 10 days after the order should have been started, that’s just too bad. MRP will expect you to get those brackets in less than the stated lead time.

Optimization, on the other hand, might recognize that half of that lead time is transportation and the purchase might be expedited by switching to a faster mode. There might be an alternate supplier with shorter delivery time. It may be possible to delay the production order start and make some adjustments in the production schedule to complete the product in time in spite of the late start. Optimization is designed to consider alternatives to come up with the ‘best’ plan, given the options available.

Supply Chain Examples

Supply chain planning is full of decisions that require a kind of ‘judgment’ to compare alternatives and find the best solution where there is no straightforward ‘right answer’.

Think about where to locate a new distribution warehouse. It should be close enough to provide acceptable shipment lead time to as many customers as practical using the least costly transportation alternatives. It should be stocked with the right mix of products, in the right quantities, to fill a high percentage of customer orders within the expected order processing and fulfillment time. There are many ways to achieve these goals and optimization will test many combinations to determine which produces the most favorable result.

Replenishment dynamics must also be factored in – distance and lead time from supplying warehouse, supplier or plant; quantity and timing of replenishment while consid13ering transportation lead times and costs for different shipping alternatives. And there’s often an opportunity to reduce cost and improve service by stocking only certain products in certain warehouses and fulfilling a single order from multiple stocking points.

Optimization is the engine that makes supply chain planning possible. It is the tool that allows planning software to go beyond strict mathematical formulas to what can be considered a small step toward artificial intelligence – software simulating something resembling human reasoning.


This post originally appeared on Navigate the Future, the Dassault Systemes North America blog

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The What, Why and How of Digital Twin in Discrete Manufacturing

The goal of a Digital Twin is to have a software copy that behaves as closely as possible to its real-world twin, capturing every single attribute of that physical thing. We are often focused on Digital Twin of a product – because as products evolve their Digital Twin can be updated to reflect the new product, it can also predate the new product. But what about the benefits of having a Digital Twin for assets? Consider a manufacturing plant, we can start with small pieces of equipment that are vital to the production – the more critical that equipment is, the more likely is it that a Digital Twin will deliver benefits. The component, of course, must be significant enough to warrant the (high) cost of developing a Digital Twin or have enough pre-existing models available to construct a first-generation Digital Twin. The key for executives is to understand that Digital Twins can bring immediate benefit to a manufacturing plant (and the products it produces), but they are a long-term play rather than a quick fix.

It’s Not Just The Industrial Internet of Things (IIoT)

When considering Industrial Transformation programs, many companies start with asset performance management (APM) owing to broad data collection and advanced analytics to improve maintenance and general asset performance. Digital Twins can go far beyond operational aspects such as APM. Rather than analyzing past performance only, the Digital Twin can also investigate the future and consider many what-if scenarios to determine how best to use an asset over time.

Digital Twins of production assets are often based on the design and implementation models created and refined during the development process. In discrete manufacturing these are developed on a product lifecycle management (PLM) platform that, traditionally, has been quite separate from IIoT and other business platforms.

Ebook: Forging the Digital Twin - intersection of PLM, business and operation platforms

Modern PLM systems bring together product and process development, allowing interaction in the development process. As Digital Twin technology advances, we are starting to see the integration of these models into the manufacturing process itself. The future of manufacturing will see great benefits, especially as orders reduce to a size of one and design changes become daily events. Digital Twin can be used to study how product design changes can be applied in the plant and how plant changes could affect production (for better or worse). Simulation of products is already becoming mainstream as Cloud computing makes available enough resources to run complex simulations. As PLM, business and operations platforms are integrated, the potential benefits of Digital Twins across manufacturing will become achievable.

Bringing together all the data, applications and models needed to profit from Digital Twins is a long process. Many will start with IIoT platforms as they promise the data, communications, analytics, and applications that form the basis of Industrial Transformation. However, PLM, simulation and manufacturing process design are maturing technologies in discrete (especially complex discrete such as aerospace and defense) manufacturing. It makes considerable sense to start Digital Twin deployment from a PLM platform that already integrates design to production processes. Many discrete Digital Twin programs look specifically at the design of machines and products; most of the data and models required are in or can be supported by modern PLM platforms. As Digital Twin grows, an extension to the rest of the enterprise will be necessary.

Platform choice today for discrete Digital Twin development and management depends on the starting point. Manufacturers that use a mainstream PLM platform should look to their PLM provider to discuss how they can build a long-term Digital Twin strategy. However, users of PLM platforms do not necessarily use applications from that single vendor only – they might use PLM from one and CAD and simulation from others. Similarly, a vendor may not support third-party tools in his Digital Twin environment. At this early stage of Digital Twin deployment, incompatibilities like these can be expected.

The alternatives to Digital Twin on PLM include having an enterprise-wide business platform that supports IIoT technologies and a wide range of Digital Twin applications, or a pure IIoT player who would be more open, but this approach might take considerably longer to deliver real value.

While Digital Twin deployment is a long-term strategy, one of the benefits is that you can start small with single pieces of equipment or a critical part of a product and grow without losing the investment made. With its multiple benefits, we urge manufacturing company executives to explore the opportunities provided by Digital Twin technology and how it can drive the Industrial Transformation initiative.

Download the complete LNS Research white paper: MOM and PLM in the Age of IIoT: A Cross-Discipline Approach to Digital Transformation

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This post originally appeared on the LNS Research Blog

Permanent link to this article: http://www.apriso.com/blog/2018/10/the-what-why-and-how-of-digital-twin-in-discrete-manufacturing/

Quick Ways You Can Optimize Your Warehouse Layout

Your productivity is directly related to your warehouse layout. With just a few changes, you’ll get more organized storage, faster order processing and safer working grounds. The best way to boost your productivity is through rethinking your warehouse.

Evaluate Storage

There are always products in every warehouse that seem to sit on the shelves gathering layers of dust. These dust-bunny magnets don’t need to take up prime real estate in your warehouse. Arrange your storage so lesser-picked products are in far corners or higher up on shelving. Use the easy-to-reach spaces for storing products you frequently pull.

One way to quickly evaluate your storage is to walk through the warehouse at the end of a shift daily for a week. As you do, look for which products are typically pulled, and which remain on the shelves. This will help you reorganize the products in your warehouse. Once you’ve reorganized your warehouse, produce a guide for the locations of the items inside. This will make it easier for your employees to find the products they need to retrieve or store.

If you’re interested in higher-tech solutions for streamlining and overhauling your storage for efficiency, look into pick-to-light and put-to-light bin labeling systems and corresponding software. A setup like this guides warehouse employees to the right bin the first time, reducing or eliminating mis-picks and mis-stows. You’ll also have a more accurate impression of which products are moving the fastest and where they might be better located in your warehouse.

Plan a Staging Area

The CEO of ShipHero, Aaron Rubin, says the biggest mistake warehouses make is not having enough staging area. A staging area allows you to accommodate the unexpected. Use this area for large loads that are either incoming or outgoing. This designated spot will keep products from accumulating between the aisles until they can be sent to their destinations.

Another means of using a staging area is for frequently pulled products. This zone could hold smaller quantities of the products you use the most. Doing so cuts down on the travel time to pull these items from the shelves. This strategy is especially useful when you anticipate large orders.

Make Safety Paramount

The safety of your employees should be the most important thing in your warehouse. In most warehouses, foot traffic and vehicles use the same aisles. When optimizing warehouse space, you might be tempted to shrink the size of the aisles to allow for more shelves. This could be dangerous for your employees, though.

Keep your aisles wide enough to allow for pedestrians and vehicles to travel abreast down them. To keep your workers safe, paint 1- to 4-inch-wide lines in high-traffic areas to designate areas for workers. These lines are also useful if you intend to automate your warehouse vehicles. Many of these vehicles require painted lines on the floor, which they follow in their duties. Lanes for your workers and vehicles will help reduce accidents and make it safer for everyone.

Warehouses of the very near future might come standard with wearable technologies for employees that keep an eye on things like working height, temperature, blood pressure, blood oxygen and more.

By applying consumer-level technologies like these — which employees already know intuitively how to use — warehouse managers can gain better insight into environmental and working conditions, as well as how they affect employees. It could be a great way to raise the bar for safety for everybody involved.

Cut Walking Time

Foot traffic in inevitable in warehouses. The facility design directly relates to how much time employees waste walking around the facility to do their jobs. It’s possible, depending on your warehouse size, for your workers to spend more than 50 percent of their time walking from place to place.

If possible, employ conveyors or automation to decrease the walking time. Proper organization of the warehouse will also help workers walk less. Post maps of the locations of products clearly so all employees know where everything is stored. This will reduce workers getting lost finding products.

One more thing that often goes overlooked is the placement of badge scanners and time clocks. In a warehouse setting — during breaks, lunches and shift changes — it’s common for high-traffic areas to become crowded and difficult to navigate.

Look into switching to or adding connected time clock terminals — which nowadays install using wireless rather than wired connections — and reevaluate your layout overall to avoid backtracking and traffic jams and ease your employees’ movements.

Make Paths One-Way

Whether paths are for vehicular or pedestrian traffic, they should be for one direction only. This keeps traffic flowing properly. It also makes it safer for all workers, both those on foot and forklift operators. When turning a forklift, the vehicle may cut into pedestrian lanes. This puts those on foot nearby in danger. Additionally, workers who turn to go backward in a lane may run into another worker or forklift.

When creating lines to split aisles into lanes for vehicles and people, also add directional arrows. You will need to educate your employees and their supervisors to follow and enforce these guidelines, respectively.

Plan for Growth

Your warehouse should be optimized not only for today but also for tomorrow. Anticipate your growth and plan additional space in your warehouse accordingly. Having enough space for expansion will allow your business to painlessly grow over time. Lisa Chu, founder of online company Black N Bianco, suggests planning for the next three to five years. She says this planning will decrease your overhead as your warehouse grows.

Improvements Optimize Warehouse Design

Making your warehouse more efficient will improve your workers’ productivity and safety. The key to your operations lies in the layout of your facility. A well-designed warehouse contributes to the functioning of the people working inside. Optimize your warehouse through better designs.

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Register Now for Dassault Systemes Online Manufacturing Summit – Live or On Demand – Learn from Leaders on The Future of Manufacturing

In today’s global marketplace, the pressures on manufacturers are greater than ever to be responsive to customers, deliver better products at lower costs, increase revenues and profits, while facing competition from new types of businesses and consumer channels. To meet these challenges, manufacturers are digitalizing their business in order to break down silos, create new collaborations, and squeeze greater efficiencies out of their organizations.

Join Dassault Systèmes for a unique, online experience dedicated to manufacturing industry leaders – across the spectrum of today’s manufacturing journey. The Online Manufacturing Summit launches on Thursday, October 18th from Noon to 3:30 PM EST and will be available live or on demand.  Register Now to join the event or to secure on-demand access to nine special interest tracks including more than 40 sessions covering today’s hot topics.

Attendees will hear from manufacturing leaders, analysts and industry influencers including AccentureCapgeminiHCLHP,  Infosys and Renishaw, and a strong line-up of manufacturing customers who will share critical insights and case studies focused on driving manufacturing innovation and results for their businesses.

Featured tracks include the following.  Attendees can stick with one track or follow sessions from any track.

  • Generative Design: Learn how to increase productivity through an integrated set of flexible process-driven capabilities.
  • Digital Manufacturing: Drive manufacturing innovation and efficiency by planning, simulating, and modeling global production processes; learn how virtual modeling, robotics, and fabrication all contribute to driving successful manufacturing efforts.
  • Manufacturing Operations Management: Learn how complex operational challenges can be met with a scalable Manufacturing Operations Management platform that can provide real-time visibility into manufacturing, synchronize execution processes, and control execution while providing localization and real-time feedback to executives and planners.
  • Supply Chain Planning and Operations:  Boost efficiency and profitability with reality-based supply chain planning, scheduling and optimization for complex business processes across all planning horizons.
  • Digital Continuity:  Learn how to capitalize on manufacturing ‘Big Data’ and the Internet of Things for global traceability and beyond.  Watch how digital data and information can be relied on as unique, authoritative and consistent as it is used across the product lifecycle.
  • The Future of Manufacturing track explores topics at the forefront of the industry including Women in Manufacturing, and the Workforce of the Future
  • And more!

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ASK THE EXPERT: Dassault Systèmes’ Fred Thomas on Manufacturing Transformation

Many manufacturers have continued to invest in technology and systems using a disjointed, piecemeal approach. In this interview, Fred Thomas, DELMIA Global Industry Director for Automotive and Industrial Equipment Industries at Dassault Systèmes tells The Record why the time for real change is now.

How would you define the concept of digital transformation within the manufacturing space?

Fred Thomas, DELMIA Global Industry Director

Digital transformation is enabling a reinvention of manufacturing. It’s a core component of a new ‘industry renaissance’ – the merger of automation, the internet of things (IoT), the industrial internet of things (IIoT), artificial intelligence, business processes, big data and cloud computing. Digital transformation enhances agility and flexibility across the enterprise by enabling digital continuity, from ideation to production through post-sales service.

What is the urgency regarding manufacturing transformation?

I believe it’s a competitive necessity, as customers are seeking personalized experiences versus commodity transactions, especially when buying a vehicle. I believe we’re moving from the age of mass customization to the age of mass personalization, where customers expect both the process and the product to be unique. From a process point of view, look at how Tesla has changed the car-buying process. From a product standpoint, I would point you to Ford’s ‘Personalize Your Pony’ program, where fans and customers can go online and design their own Mustang logo which can then be duplicated across any number of personal items, including clothes, coffee mugs and even ordered on your new Ford Mustang vehicle.

This level of personalization is going to rapidly expand across the industry and it is my belief
that a lot of manufacturers are unprepared to support this kind of mass personalization with
their current manufacturing systems.

What specifically have you seen that causes you the most concern?

I have three primary areas of concern in terms of traditional automotive original equipment manufacturers (OEM) being competitive in a mass personalization-driven world. The first is that they are not responding to the competitive threat presented by automotive OEM startups that don’t have a 100-year legacy to deal with. That means they don’t have the outdated legacy solutions to maintain and can start with model-based, platform-driven manufacturing systems that are infinitely more capable of supporting not only new vehicle technologies, such as electrification and autonomous vehicles but also the processes associated with vehicle personalization. My second concern is that there has been a lack of progress in digital or virtual manufacturing systems adoption, and my third concern is the ongoing tactical response of solving manufacturing execution problems on the shop floor with more homegrown and point solution purchases. This only extends the disparate, silo-based manufacturing environment to the detriment of building a future on a strategic model-based foundation that can drive uniform digitalization across the global manufacturing organization.

Continue reading the rest of the interview here. Excerpted from The Record, issue #8: Spring 2018

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