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Question 1 ( a )
TEP had faced three major problems. There are delivery reliability, increased levels of finished
goods inventory and failing productivity. The factor that occur in delivery reliability is there are
24 machines which are working on a standard (non-overtime) 105 hours per week, 50 week for
per year. So, there are 2520 (24 X 105) machine hours available per week. There are more than
500 plastic products, each requiring about 3 hours to set-up (costing Euro 500 per set up), and
the minimum run length is 20 hours. Thus, the minimum machine time of any batches is 23
hours. The system reliability could be used here to understand the impact of the number of levels
and suppliers at per level. Each supplier in a supply chain is similar to a machine processing in
the production system. A suppliers failure to supply the right product at the right time ( late
delivery, poor quality) affects the reliability of the whole system.
Supply chains are not simple to analyse however, by focusing on the four supply chain operation
reference model management factors are plan, source, and deliver, it becomes easier to examine
and thus identify factors that contribute to the delivery reliability of TEP MTO ( make-to-order)
productions.




PLAN

The Plan process describes the planning activities associated with operating a supply chain. The
schematic in figure 1 is the planned process of receiving orders from customers to delivering to
the customer. Sales person receives customer orders and follows the process. All relevant
information is attained from customer and the order is processed.

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Figure 1 Process from customer order to customer receipt
The overall planning process of TEP production is not defined with an MPC system. No real
objectives or sales and operation plan Standard Operating Procedure (SOP) is carried out. The
production operates on a basic manufacturing plan that is organized by the production team. The
plan is done subjectively; therefore, experience is used to setup the production plan.
The Extrusion department plans their weekly production with a Gantt chart shown in figure 1.2 .
Each machine is broken down and productions are ordered in the most convenient in relevance to
changeovers and such. This gives an indication to the other departments when they can expect
orders to be available and allows staff to be better prepared for changeovers.



Figure 1.2 Gantt chart of extrusion department production in machine 102
The pre-production process is a factor that could contribute to TEP unreliable delivery. The sales
department takes orders from customers and then follows the process in figure 1.3. If a customer
needs a new product the specifications are sent to production control where the technical
manager prepares a recipe for the product that includes the raw materials needed and the process
it needs to take,( what actions in the production need to be taken). The main problem in this stage
is that one man or the technical manager is responsible for the recipe and if he is unavailable then
the process takes longer time, but in specific cases the production managers can intervene and
prepare the recipe. When the recipe is ready an order confirmation is made and printed out, the
confirmation is printed when there are six to eight weeks until the date of delivery. That means
the production department have an overview of productions for the next six to eight weeks. A
backup list is made by the technical manager and is sent to the production managers weekly so
they have a better overview and can plan the productions so there is quite high operation
security.
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There is not a priority plan in place at TEP to define priority requests from customers who wish
to receive their orders earlier than the delivery window defines. These requests are affecting the
production schedule and causing disruption in the production process. Therefore affecting the
delivery reliability of other productions that get delayed because of the priority orders.

Figure 1.3 Pre-production process

As the production processes are quite complicated and they have a wide product range at TEP,
orders have to travel differently through the processes. The print design process can be time
consuming, and most often it is the customer who slows the process down as they often take a
long time in deciding the design. This can lengthen the delivery reliability, but in most cases it is
the customer who is accountable.

To conclude, there are factors in the planning process, which are affecting the delivery reliability
of TEP MTO orders. The highlighted factors in this section are the lack of an overall planning
process and objectives and priority requests. Possible improvements are introduced in the
Improvements chapter hereafter.
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SOURCE

The Source process describes the ordering, scheduling and receipt of goods and services.
In order to for TEP to supply customers it needs raw materials to process into the products they
sell. The process of purchasing is defined in the following schematic. The schematic shows the
purchasing of new and old products. The purchasing manager is responsible for sending
purchasing orders to suppliers. Purchases are done with advice from the sales department and the
production managers.

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Figure 1.4 Purchasing process

The purchasing is quite complex as the objective is to limit inventory to save cost but still be able
to service customers with products. Also, a minimum quota of purchased products often applies
and some of the purchased products have a lifetime and spoil if not used within a certain time.
Therefore, the challenge is to buy an economical amount to save on transportation costs, and also
buy the right quantities so it the material does not diminish whilst maintaining a good service
level to customers.

In most cases it is above the four weeks delivery window TEP defines as their lead time to
customers. Shortages in raw materials can have a big effect on TEP capability of promising
orders in four weeks.

Purchasing is complex and could be the focus for another raw materials thesis so no quantitative
data will be put forth, only qualitative. TEP purchasing of the following goods are in the hands
of the production managers as they are responsible for utilizing them and have the best sense of
how much is used and, therefore, how much is needed. They are doing a good job and are
achieving fewer shortages whilst maintaining a low level of inventory.
To conclude, there are factors in the Source process, which are affecting the delivery reliability
of TEP MTO productions. The highlighted factors in this section are complicated purchasing and
the need for better material resource planning.


DELIVER
The Deliver process describes the activities associated with the creation, maintenance, and
fulfillment of customer orders. It includes the receipt, validation, and creation of customer
orders; scheduling order delivery; pick, pack, and shipment; and invoicing the customer.
The warehouse is responsible for scheduling orders, delivering orders and invoicing customers.
The below schematic is the process for the distribution process.












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Figure 1.5 Distribution process 79
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The below schedule is the distribution plan of TEP. Some customers choose to pick up their
orders themselves. Although the schedule is set up as below it is very flexible and services TEP
customers well. If orders are received before 11:30 am, they are delivered the same day in the
capital area. Most of TEP customers are relatively close or in the capital area. Customers, who
are outside the capital area, or in the countryside, get their orders shipped daily through an
outsourced trucking company.

It is my qualitative opinion that the distribution of TEP orders to their customers is not a factor
that concerns the delivery reliability. The reason for this is the flexibility of the schedule and the
relative short distances orders need to travel to customers.

The only concern is when TEP is exporting orders; which need to be ready to leave on Tuesdays
when the ship departs for Europe. If they are unable to do so they have to wait a week or use
shipping with cargo airplanes, which is more costly. This means that the delivery will be one
week late or very costly for TEP. However, the company is not a major exporter so this factor is
not significant.

The second major problem is increased levels of finished goods inventory is a problem of TEP.
Its mean that inventory as total number of stock, goods or materials contained in a store or
factory at any given time. It is also defined as stored recourse that is used to satisfy current or
future needs. Some time they are considered the most expensive assets of the company.
Inventories are categorized in three different types as row martial, work in process and finished
goods. Inventory management plays a crucial rule in monitoring and controlling the stock, and
support the production plan and chain supply considering the balance of the level of the stock
kept, as extra or less of it is incur cost of money, time, and value. Inventory is very imported for
companys financial position and reputation if it is properly controlled for the following reasons,
1- Associated cost with holding stock can be reduced.
2- Less likely run out of stock or hold excessive amount if closely stock.
3- Help to keep stock within space.
4- It help in keeping stock in correct proportion

Furthermore, Inventory can be associated with a service and/or a manufacturing martial that will
be discussed further when we revise TEP issues.




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The third problems TEP had faced is failing productivity. Failing productivity obviously
resulting from split batches where only part of a planned production batch is make to handle
immediate shortages. Because of current high demand for a lot of products, the backlog of work
for planned stock replenishment currently averages two weeks and so all factory orders must be
planned far in advance. Because of this backlog many shipments are received by distributor more
than several weeks. This causes those companies to rise up their administrative and solving costs,
and TEPs haulage costs. The other factor of failing productivity is the worker newer follow up
with the (SOP) of machines and product. The quality of product decreased after the Quality
Control process has been done. The number of acceptance of goods is lesser than the number of
goods rejected. The rejected goods have to scarp and re-do the process of product. The other
factor will be there are minor problems can be found out on the machinery system. This problem
can effect to defection of the product.

















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Question 1 ( c )
The process design of TEP production refers to the series of steps required to turn raw oil and
natural gas into plastic products such as household items. Polymer plastics defined very difficult
process that first begins with transforming oil and natural gas into hydrocarbon monomers that
are then linked together into long chains. According on the type of monomers linked together,
the process can produce a variety of different types of polymer plastics, such as polyethylene
terephthalate (PET), high density polyethylene (HDPE), and polyvinyl chloride (PVC).plastic
products, such as cups, hoses, pipes, and straws.
The step of process design of TEP production are shown below:



injection molding
extrusion molding
blow molding
thermoforming process
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Injection Molding
Plastic polymers that have been compressed into plastic pellets are fed into an injection molding
machine is called injection molding process. Injection molding is the most commonly used
method for mass production of plastic particles because of its high production rates and the good
control over the dimensions of the products. These machines mold the pellets into the correct
shape and add additives to give them the actual color and texture. Butter tubs,yogurts
container,closures, and fittings are plastic products of this process






Figure 1.5 Plastics injection molding.











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Extrusion Molding
Plastics extrusion is a continuous process used to form a linear product having a constant cross
section. A single screw extruder is depicted in Figure 1.6, and is comprised of a heated barrel
surrounding one or more rotating screws driven by a motor. During operation, the solid plastic
pellets are fed to the screw. The screw is carefully designed to auger the material forward toward
the die with continued rotation. As the material is conveyed forward, the plastic is compressed
and converted to a molten state by a combination of heat conduction from the warmer barrel and
internal shear heating caused by the flow of the plastic within the screw. By the time the plastic
reaches the extruder outlet, a homogenous polymer melt should be formed with a desired melt
temperature. A breaker plate, screen pack, and die are located at the extruder outlet. These
components serve to seal the interface between die and the extruder, filter any contaminants,
increase the flow resistance and plastication pressure, and ultimately form the polymer melt into
a desired shape. As the plastic leaves the die, it may swell due to the change in pressure at the die
lip and subsequent polymer relaxation. Afterward, the extruded may pass through calibrator dies
or calendar rolls to control the solidification and dimensions. If dimensional control is not
critical, the extruded may simply be pulled through a water bath or just air cooled prior to
spooling, cutoff, or other post-processing. In terms of sheer volume of plastic parts, the most
common applications of extrusion are pipe, tubing, film, sheet, and custom profiles. Altogether,
extruded products represent approximately 35% of the plastics industry output.


Figure 1.6 Plastics extrusion.





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Blow Molding
Blow molding is a more difficult process that is used to make hollow plastic products with an
opening or neck. The process basically involves heating the polymer, which is fed from a hopper
in granular pellet or powdered forms, to a viscous melted state and then forcing it into a split-
mold cavity, where it hardens under pressure. Injection blow molding and extrusion blow
molding are the type of blow molding process. Both processes including turning plastic pellets
into molds and then compressing air into the molds to make them hollow. Injection blow
molding can only provide small containers, whereas extrusion blow molding isnt limited by size
are the difference of this process.

Figure 1.7 Plastics blow molding.





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Thermoforming Process
Thermoforming is a cyclic process for making large or small plastic products that typically have
one large open face, such as refrigerator liners, bath tubs, or drinking cups. There are many
different types of thermoforming processes including vacuum forming, pressure forming, plug
assist forming, and others. Figure 31.9 depicts a vacuum forming process, which is the simplest
of these processes. In this setup, the thermoplastic sheet or film is heated in an oven by radiant
heaters. Once the sheet is sufficiently compliant, the sheet is shuttled to the mold where a
vacuum is applied to remove the air between the sheet and the mold cavity surfaces. The sheet is
held against the mold surface until sufficiently cooled and rigid. The sheet with the formed part
is then removed from the mold and trimmed. As with blow molding, the inflation of the sheet
into a deep, non-uniform mold cavity can result in broad variations in the wall thickness of the
thermoformed part. Compared to the previous processes, thermoforming may be the simplest
process with the lowest investment in tooling but also the lowest production rates. Additional
investment can improve the economics and capability of thermoforming
processes. For example, the two-station setup of Figure 31.9 may have almost twice the
production output of a single station thermo former since one sheet may be heated while a
previously heated sheet may be loaded, formed, cooled, and unloaded. As another example,
pressure forming uses larger positive pressures than vacuum forming to more rapidly deform the
sheet with larger forces, thereby forming more complex and thinner sheets to higher levels of
detail. As yet another example, moving plugs may be used to deform the heated sheet during the
former process and thereby assist the distribution of the plastic throughout the thermoformed
part.

Figure 1.8 Plastics thermoforming


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REFERENCE

1) A. L. Guiffrida, R. Nagi: Cost characterizations of supply chain delivery performance,
International journal of production economic,

2) Brown, K. and Vastag, G. (1993), "Determinants of manufacturing delivery reliability: a
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3) Ferdows, K. and De Meyer, A. (1990), Lasting improvements in manufacturing
performance: in search of a new theory,

4) R. Karania, D. Kazmer, Low volume plastics manufacturing strategies, J. Mech. Des. 129
(2007)

5) Kazmer, Injection Mold Design Engineering, Carl Hanser Verlag, Munich, 2007

6) R. Malloy, Plastic Part Design for Injection Molding:An Introduction, Hanser Gardner
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7) N.C. Lee, Understanding Blow Molding, Hanser Gardner Publications, 2007.

8) Baily, Martin Neil, Hulten, Charles and Campbell, David (1992), Productivity
Dynamics in the Manufacturing Plants, Brookings Papers on Economic Activity:
Microeconomics 1992,

9) Dahlman, C. and O. Sananikone (1990), Technology Strategy in the Economy of Europe
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