Analyze Effects of KanBan on Manufacturing Supply Chain
A global manufacturing and distribution company undertook a supply chain project that would reduce the amount of inventory held at its distribution centers by adopting an internal KanBan replenishment type process.
The supply chain project team wanted to re-engineer one of their plants, which employed a cellular manufacturing process. The client wanted to know where and how much space and inventory would be required within the plant to provide a targeted service level of all orders being satisfied within a 72 hour window. They wanted to establish the appropriate staging and sizing of intermediate finished product within each Cell in the plant to satisfy target order service and inventory holding levels.
The client’s project team chose a simulation approach to properly analyze the dynamic process. They contacted Visual8 to develop a Cell Manufacturing Plant Re-Engineering Simulation that would analyze the details of the plant operations and assist in staging the required levels of work in process product for the individual products ordered from the distribution centers.
The model was designed as a generic manufacturing cell to analyze the workings of other plant cell operations without the need for specialized modeling effort. Parameters included:
- Product order profiles,
- Volumes and frequency,
- Machine cycle times,
- Number of KanBan containers and their size in the Cell,
- Staffing levels and
- machining times.
The Cell Manufacturing Plant Re-Engineering Simulation helped determine which products should be staged, at what level, and with what amount of inventory. The model also addressed the responsiveness of the production process to the various order patterns occurring from the distribution centers due to promotions or product seasonality, as well as the constraining influence that upstream annealing, saws and tube mill operations may have on supply.
The Cell Manufacturing Plant Re-Engineering Simulation accurately reflected the planned KanBan production process, which was validated and used by the client. The high-level, practical tool was used to evaluate and size the KanBan production system that satisfied the project team’s supply chain objectives. The simulator identified production bottlenecks within the plant that were caused by an imbalance in manufacturing capacity to meet the required volume and mix of orders. Through ‘what-if’ analysis, the client determined the “best” strategy to handle the predicted volume and frequency of warehouse orders.