Case Studies - Food
/ Drink
Solution: Capacity analysis
and improvement
Wright Brand Foods doubled their production capacity and estimated
their savings to be over $10 million by using PROMODEL predictive
technology. Before selecting PROMODEL, they tried using a consulting
firm who developed lots of complicated spreadsheets and charged
over $250,000. The result was NO savings and lots of time wasted.
Then a custom solution from PROMODEL saved the day by accurately
modeling their complex food-producing process and quickly making
valuable recommendations for new equipment, changes in process and
improved scheduling of personnel that resulted in large savings.
Solution: Simulation Modelling
Simulation Modelling has played a key role
in both the successful delivery, and the on-going management, of
an expanded warehouse and distribution facility for Walkers Snacks
Foods.
A rapidly growing snack food market, and the ability
to capture an increasing share of this market, in part thanks to
some high profile marketing, has seen Walkers Snack Foods Ltd experience
major business growth over the past few years. But, this success
has also placed considerable new demands on its UK operations. To
manage these, the company - which is now part of the global giant
PepsiCo Inc - has undertaken a major programme of upgrading and
expanding of production and distribution facilities. One of recently
completed key projects in this programme, a vital element in the
company’s remodelling of its distribution capabilities, has
delivered a massive warehouse expansion at Walkers’ Leicester
based factory and warehousing complex.
However, adding storage was only one of the requirements for this
development. It also had to deliver operational process improvements
in terms of picking efficiency and throughput, and so enable the
output capacity of the whole Leicester complex to keep pace with
requirements. Therefore, to help ensure that the final design solution
was capable of meeting these demands, Walkers, and its project partner,
the warehouse solution provider Swisslog, turned to simulation modelling,
and the UK based specialist system supplier and consultancy, Production
Modelling. As it has turned out, not only did the modelling help
prove the design concept, it provided detailed process analysis
that led to direct project savings. Additionally, a detailed simulation
model was also developed that is now being used by Walkers as an
ongoing operational management and training tool.
Project Background
By the end of 2002, Walkers had identified that to keep pace with
continued UK sales growth, the warehousing and distribution capacity
at its Leicester complex needed to be radically increased.
At the time, the facility included two factories with seven production
lines, two of which were recent additions, a single warehouse, fed
automatically by the two factories, and the Southern Region Distribution
Centre (SRDC). Sited side by side, the warehouse and the SRDC, had
previously been integrated through the introduction of a monorail
system. This runs on a circular track round the SRDC, transporting
full pallets from the high bay warehouse to either the SDRC’s
marshalling lanes, for full pallet pick, or to the picking frames,
and also transport case picks from the picking area to the marshalling
lanes. But, with the increased production from the new lines, the
storage capability of this facility, at 9800 pallets, was far from
sufficient. In fact, Walkers was having to store products off-site
and bring them back to the distribution facility for dispatch. Also,
the maximum distribution throughput of the combined operation, at
200 pallets / hour, was also no longer adequate to effectively meet
demand.
To solve these issues Walkers set up an engineering project team,
and brought on board Swisslog, who would undertake the detailed
design work and implement the solution. The concept design that
this combined team developed was for a large second high bay warehouse,
with space for 13320 pallets, which would be fully integrated with
the existing warehouse and the SDRC.
This integration would be achieved by building the new warehouse
on the opposite side of the SDRC, from the original warehouse, and
then expanding the monorail system to serve both warehouses. The
new warehouse, which would be directly linked to the factories,
would then feed the monorail from the opposite site of the system
to the existing feed, and so utilise the existing picking and dispatch
capability and so create a combined operation that could deliver
a significant increase in peak throughput, from 200 to 320 pallets
/ hour.
John Coates, project director for Walkers Snack Foods, explains,
“We knew that we would get some important improvements by
introducing a new warehouse on the site, and so reducing the need
for outside storage, which was costly and inefficient. We also believed
that the existing facilities, and in particular the monorail system,
had latent distribution capacity that could be utilised to cost
effectively deliver a major increase in combined throughput .”
However, while the principle was sound, and management approval
for the investment was given the go-ahead, this concept was based
on a number of system assumptions, and it was vital that these were
fully addressed before detailed design and installation began. As
Coates adds, “Significant questions remained as to whether
the monorail would simply become too easily grid-locked in practice,
when being fed from both sides, and what changes or additions would
be needed in equipment, infrastructure, and operational practices
to deliver the required throughput of goods.”
To answer these questions the joint project team comprising of Walkers,
IMI and Swisslog staff, brought in Production Modelling to undertake
a detailed process modelling exercise.
Geraint Foulkes, the project manager for Swisslog notes, “Simulation
Modelling is a tool that we have used on past projects. However,
this was a particularly complex system and so it was important to
find the right external partner for this work. In the end, the team
looked closely at two suppliers, but we found that Production Modelling’s
understanding of the situation and complexities involved was far
better, and they had the skills and experience to effectively deliver
the detailed modelling that was required.”
Simulation Strategy
The simulation work had a number of distinct phases. Initially,
Production Modelling’s team used the ProModel simulation software
to model and verify specific elements of the system, at pallet level.
In particular, close attention was paid to the configuration of
the monorail system.
This model was not only able to answer the key question, that the
system could be used as anticipated without any major configuration
changes, but also provided important data for the overall project
that would have only been found by expensive trial and error. For
a start, it had been anticipated that to provide the 320 pallet
/ hr throughput, up to six more monorail trolleys could be needed.
But, the simulation was able to prove that there were already enough
trolleys on the existing system to meet this peak demand, which
meant a direct project saving of up to £150 000. Although,
it also found that extra lifts, dedicated to moving pallets from
the mono rail to the marshalling areas, would be needed, and highlighted
the importance of a section of track across the centre of the circuit
that acted as a quick return short cut for emptied trolleys.
Another of the major contributions of the initial simulation exercise
was to determine that during the part of the week when the system
was not being run at peak throughput, but at a much slower rate
of 160 pallets / hr, it was important to park a number of unused
trolleys in a new parking area, thus avoiding having to constantly
rotate empty trolleys together with full ones.
The modelling was also used to investigate a number of operation
issues, as Tim Cooke, senior project consultant at Production Modelling
reports. “The flow of products within the combined facility
is very complex, and the simulation also highlighted how significantly
the spread of products through the two warehouses could affect throughput.”
He adds, “We were able to experiment with different storage
scenarios, and for instance found that putting all the high runners
in one store produced very poor throughput results. From this work,
we were then able to help determine the key rules for picking pallets
from the two different warehouses, which would deliver the required
throughput, and these in turn dictated the important factors for
pallet storage.”
“The modelling not only provided us with the confirmation
that would could meet the throughput target, but also answered a
number of crucial design and operational questions, which would
have been almost impossible to solve prior to build without simulation,”
adds Foulkes.
Added Ongoing Benefits
This was, though, far from the end of the simulation exercise. The
next stage was the development of a far more detailed model of the
whole combined operation, which could be run at SKU level. While
this was important for design verification, and helping to determine
optimal operational speeds and feeds for various equipment, it was
primarily developed on the request of Walkers for far more long-term
reasons.
“We intentionally decided to make the extra investment in
a far more detailed model than was strictly necessary for the design
confirmation, because we recognised the important roles such a model
could play in preparing staff for the new facility, and as an everyday
management tool once the implementation has been completed,”
reports Coates.
Having taken a licence for the ProModel software, Walkers are now
deploying this detailed model to
help with the ongoing management and development of the operation
and its staff. For instance it is being used to illustrate to both
senior management and those within the operation how the new system
works. It will also help train operators and managers, enabling
them to work ‘off-line’ through various scenario that
they may come across on a daily basis, such as a crane failure,
and see the best options for action. Other usages include ongoing
improvement activities, such as looking at the logic of how orders
are released to the warehouse from the main business management
system, so that lorries are loaded correctly, and assessing if changes
to these long standing practices will yield any benefits.
As Coates adds, “The detailed model will prove invaluable
for training front line managers, and all the SRDC staff - getting
them used to the system on the model and learning about key issues.
It is also currently being used to assess existing operational practices,
and this has already shown that there is potential in the system
for further improvements.”
He concludes, “Overall, the decision to apply simulation technology,
and the expertise of Production Modelling, has proved to be a key
aspect in the successful delivery of this project.” |
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