This document summarizes a project to improve the transportation methodology for an international logistics system. It applied value stream mapping to analyze shipping and storage consolidation. Simulation modeling was used to assess different scenarios. The simulations validated consolidating transportation and storage, reducing inventory time, transportation costs, and the number of trucks needed. The future state maps showed improvements like reducing raw material storage from 4 to 1 day and in-facility time from 44 to 14 days. Employees were engaged through noticing the differences and using visual tools to interpret results.
This document summarizes a project to improve the transportation methodology for an international logistics system. It applied value stream mapping to analyze shipping and storage consolidation. Simulation modeling was used to assess different scenarios. The simulations validated consolidating transportation and storage, reducing inventory time, transportation costs, and the number of trucks needed. The future state maps showed improvements like reducing raw material storage from 4 to 1 day and in-facility time from 44 to 14 days. Employees were engaged through noticing the differences and using visual tools to interpret results.
This document summarizes a project to improve the transportation methodology for an international logistics system. It applied value stream mapping to analyze shipping and storage consolidation. Simulation modeling was used to assess different scenarios. The simulations validated consolidating transportation and storage, reducing inventory time, transportation costs, and the number of trucks needed. The future state maps showed improvements like reducing raw material storage from 4 to 1 day and in-facility time from 44 to 14 days. Employees were engaged through noticing the differences and using visual tools to interpret results.
CÓD: 2150621 PROJECT TO IMPROVE THE TRANPORTATION METHODOLOGY
Project created and focused to 2 walk:
1) The trucks that move finished goods to Europe and Charlotte
have to be fully loaded.
2) The trucks used to transport product to Canada and Asia may
transport partial carrier loads. TRANSPORTATION IN VSM • The total transportation cost can be drastically reduced if the frequencies of transportation are reduced or minimized.
• The transportation costs are volume dependant because of this,
by utilizing efficiently the trucks capacities, transportation costs are minimized SCALE AND CURVE • SCALE: substantial economies of scale result from the necessary aggregate safety stock being reduced whenever decentralized inventories are centralized into fewer points.
• CURVE: exchange curves are tools that provide an optimal
range for operation of the inventories. METHODOLOGY SURVEY OF EXISTING OPERATIONS: it consist in identify problems, resources utilization levels and current practices of doing businees.
When we want to usderstand this first step, we need identify the
complexity of the manucfacturing operations.
In the case, they identified 2 major problems:
1) Inventory levels. 2) Transportation problems. ANALYSIS OF SHIPPING AND STORAGE CONSOLIDATION: it consists in analyze the transportation and storage consolidation.
• Manufacturing facilities share a raw materials warehouse.
• Trucks were not loaded at full capacity, and manufacturing
facilities were required of daily shipments of raw materials. SIMULATION MODELING FOR WHAT-IF SCENARIO ASSESSMENT: it consists of simulating the purposes of the Company with a useful instrument to effectively obtain the proposed consolidation of schemes.
These simulations can be used as tools for transportation
planning and cost estimations since the number of orders, order sizes and delivery dates can be input in the models. VALIDATION USING SIMULATION OF THE OVERALL TRANSPORTATION AND STORAGE CONSOLIDATION: it consists of developing dynamic conditions for the recommendations of transportation and storage consolidation.
• The simulation modeling tool provided an estimate of the
number of trucks needed as well as the transportation cost for the consolidation of finished goods and raw materials. ANALYSIS OF FUTURE TOTAL VALUE STREAMS: it consists of the interpretation of data dropped by simulation.
• The most important improvement was in raw material inventory,
days in inventory were reduced from 4 days to 1 day. .
• Regarding the transportation problem, the number of days that
a truck waits to comply with the customers’ shipping requirements was reduced from 3 days to only 1 due to the use of consolidation of finished goods orders. • The inventory time in storage was reduced from 30 days to only 1day.
• The finished goods inventory decreased from a range of 2 to 3
days to one day.
• the fact that the transportation issue was forcing to delay
finished goods shipments from the warehouse, was resolved with the consolidation.
• All these improvements led to a decrease of the in facility time
from 44 days to only 14. Table 1. Comparison between Current and Future Total Value Stream Maps with difference. TOTAL VALUE STREAM MAPS COMPANY FACILITY PERFORMANCE MEASURE DIFFERENCE CURRENT (DAYS) FUTURE (DAYS) RM Time in Storage 4 1 3 FG Time in Storage 1 1 0 FACILITY A Waiting Time 3 1 2 In-Plant Time 13 9 4 RM Time in Storage 30 1 29 FG Time in Storage (2-3) 1 (1-2) FACILITY B Waiting Time 1 1 0 In-Plant Time 44 14 30 TOTAL (98-99) 29 (69-70) PROJECT SUGGESTIONS FROM EMPLOYEES:
• By noticing the difference and change with the applied
methodologies, employees participate more in decisión making and brainstorming.
• Also, graphic tolos were used for a better interpretation of the