A consumer products manufacturer needed to know how much in-process storage its plant required between making and packing. The answer turned out not to be a single number. It depended on the schedule, and the schedule depended on the storage.
The plant
The plant made several kinds of material and held them in in-process storage before packing. Some material was recycled back into the process as reblend. That meant the flow into storage was not just the making rate. It also included whatever was being reblended, and the amount depended on what had been scheduled.
The two ways to get storage wrong did not cost the same. Too much storage ties up capital and floor space. Too little backs up into the making process and shuts down the upstream end, which is the most expensive part of the plant to stop.
How we modeled it
SDI built a discrete rate (bulk flow) model of the making, storage and packing operations, with a custom schedule generator. With the generator, the team could test scheduling rules and parameters themselves, not just a few fixed schedules. The model tracked in-process inventory of each material over time, including the reblend stream feeding back into the process.
Why trust it
The model showed how in-process inventory rose and fell under each scheduling policy, run through time, rather than giving one average level. The best check came afterward. The model was adapted and re-implemented at a dozen similar factories, which says the behavior it captured was built into how these plants work, not a quirk of one site.
What we found
- Storage needs were sensitive to scheduling rules and reblend. Change the schedule and the reblend volume changed, and so did the storage the plant needed.
- Some storage problems were really scheduling problems. Utilization problems that looked like they needed more tanks could be reshaped with scheduling parameters instead.
What changed
The model led to better scheduling strategies and storage sizing at the plant. It was then adapted and re-implemented at a dozen similar factories in the region.
Source
SDI project record; client not named. For the ReliaSim view of this study, see When the right size moves with the schedule.