Reducing disruptions in production process by solving inventory related issues
Peltola, Tuomo (2018)
Peltola, Tuomo
2018
Tuotantotalous
Talouden ja rakentamisen tiedekunta - Faculty of Business and Built Environment
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Hyväksymispäivämäärä
2018-02-07
Julkaisun pysyvä osoite on
https://urn.fi/URN:NBN:fi:tty-201801261163
https://urn.fi/URN:NBN:fi:tty-201801261163
Tiivistelmä
This study examines two inventory related issues pointed out by the case factory. The record inaccuracies in the raw material store and the capacity of the work-in-progress (WIP) inventory were seen as causing disruptions in the production process of the case factory. The objective of this study is to find the causes behind the issues and their effects on the production process, and thereafter to give suggestions on how to improve operations.
A data based analysis is performed on the given problems. The main data used in the study is historical production data from a period of 12 months gathered from the case factory’s information systems. Observing processes and interviewing operators are also utilized in data gathering. Suggestions for improvement are given based on the gathered and analyzed data with guidance from chosen literature principles. The reviewed literature includes inventory management, lean thinking and the theory of constraints (TOC).
Six different sources of inventory record inaccuracy were identified. Both system error and human error are present in the identified sources of inaccuracy. The best solution for eliminating inaccuracies is to update the raw material store management system because the current system does not offer the required functionalities for better management of records. The inaccuracies can be controlled to some extent by the means of changing the ways of working and implementing a form of cycle counting. Increasing the inventory record accuracy results in raw material cost savings and less disruptions and waste in the process due to less usage of substitute materials.
The capacity of the WIP storage can be seen as disrupting Feeder’s production, but is not the root cause. The root causes are the reasons for the performance difference between the converting process and the Feeder, which cause WIP products to build up in the storage. The converting process is the constraining resource of the production system and should be elevated. Focus should be in eliminating non-value adding disruptions and examining the possibility of increasing the capacity of the converting process. Reducing disruptions leads to better production scheduling which leads to better control of the WIP storage area. The primary objective of scheduling should be maximizing the uptime of the converting machines.
A data based analysis is performed on the given problems. The main data used in the study is historical production data from a period of 12 months gathered from the case factory’s information systems. Observing processes and interviewing operators are also utilized in data gathering. Suggestions for improvement are given based on the gathered and analyzed data with guidance from chosen literature principles. The reviewed literature includes inventory management, lean thinking and the theory of constraints (TOC).
Six different sources of inventory record inaccuracy were identified. Both system error and human error are present in the identified sources of inaccuracy. The best solution for eliminating inaccuracies is to update the raw material store management system because the current system does not offer the required functionalities for better management of records. The inaccuracies can be controlled to some extent by the means of changing the ways of working and implementing a form of cycle counting. Increasing the inventory record accuracy results in raw material cost savings and less disruptions and waste in the process due to less usage of substitute materials.
The capacity of the WIP storage can be seen as disrupting Feeder’s production, but is not the root cause. The root causes are the reasons for the performance difference between the converting process and the Feeder, which cause WIP products to build up in the storage. The converting process is the constraining resource of the production system and should be elevated. Focus should be in eliminating non-value adding disruptions and examining the possibility of increasing the capacity of the converting process. Reducing disruptions leads to better production scheduling which leads to better control of the WIP storage area. The primary objective of scheduling should be maximizing the uptime of the converting machines.