Systems Analysis Speeds Up Chipita's Food-Processing Line

Interfaces, � 2002 INFORMSVol. 32, No. 3, May–June 2002, pp. 62–76

0092-2102/02/3203/0062$05.001526-551X electronic ISSN

Systems Analysis Speeds Up Chipita’sFood-Processing Line

George Liberopoulos • Panagiotis TsarouhasUniversity of Thessaly, Pedion Areos, GR-38334 Volos, Greece

Chipita International, Inc., Lamia Industrial Park, GR-35100 Lamia, [email protected] • [email protected]

This paper was refereed.

Chipita International, Inc., one of Greece’s largest manufacturers of bakery products andsnacks, makes croissants on seven specialized processing lines in Lamia, Greece. A rise in thedemand for croissants over the past years called for an increase in output. We undertook aproject to determine cost-effective ways of speeding up the croissant-processing lines. Wefound that the efficiency of a typical line (the ratio of the effective processing rate to thenominal processing rate) was 86 percent because of equipment failures. To reduce the impactof failures and increase the efficiency of the line, we proposed to modify the line by insertingan in-process buffer-refrigerator having a capacity of 40,000 croissants in the middle of theline and by speeding up the part of the line upstream of the buffer. We found that the efficiencyof the modified line would rise to just under 98 percent at a cost of a minor increase in in-process inventory. We estimated that the modified design of the line would bring in extraearnings and savings of $19,150 per week because of the resulting increase in output, theelimination of the first shift of the week, and the reduction of scrapped material during longfailures.(Industries: agriculture–food. Manufacturing: automated systems. Reliability: failure models.)

T he bakery-products-and-biscuits sector is one ofthe most stable sectors in the food-and-beverages

industry worldwide. In a recentmarket-analysis reportcovering the five-year period from December 1993through December 1998, the global intelligence groupEuromonitor International reported that the growth involume of bakery products during that period wasonly six percent, as changing eating habits, such as thewaning of traditional family meals and the replace-ment of bread by a variety of products in poorer mar-kets, had a negative impact on sales (Euromonitor1999). Euromonitor also found that, although theglobal market for bakery products as a whole had re-mained fairly stable, breakfast goods showed the mostdramatic growth (18 percent), reaching 9.7 million tonsand rising by eight percent in terms of value.Chipita International, one of Greece’s largest food

manufacturers specializing in bakery products, withextensive activities in Greece and abroad, has been fac-ing a significant rise in the demand for croissants—popular morning pastries—during the past few years.In view of this situation, in the early summer of 1999we undertook a project to find cost-effective ways ofspeeding up the croissant-processing lines at Chipitaand determining the benefits from the resulting in-crease in sales and market share. We used operationsresearch to reach this goal.

The CompanyThe Chipita International, Inc. Group started in 1973with the production of salted snacks and has grownremarkably. In 1990, it increased its share capital by$0.82 million (based on an exchange rate of 400 drach-mas or 0.852 euro to the dollar) and constructed a new

LIBEROPOULOS AND TSAROUHASChipita International

InterfacesVol. 32, No. 3, May–June 2002 63

plant in Lamia Industrial Park, Greece. In 1991, it pen-etrated the croissant market, and in 1994, it joined theAthens Stock Exchange, increasing its share capital by$5.35 million. In 1996, Chipita began manufacturing itsproducts abroad (in Bulgaria and Portugal) throughjoint ventures. A year later, the company entered thebread market, and its manufacturing joint venture inEgypt began production. In 1998, Chipita realizedfixed investments totaling more than $17.5 million. Inaddition, the company made major acquisitions inGreece, Poland, and Romania, becoming the marketleader in packaged croissants in these countries. To-day, Chipita is a $105 million company that dominatesthe Greek croissant market, with a market share ofabout 70 percent (in volume).

The ProductCroissants have a long history. The first croissantswere made in Austria in 1697 after the victorious battleof the Austrians over the Turks near Zenta in modernHungary. To commemorate this victory, Austrian Em-peror Leopold’s personal chef created a new delicacyshaped as a crescent, a symbol of the Muslim worldand in particular the Turks. Years later the Frenchadopted this delicacy, named it croissant, and placedit among French bakery specialties. From France, thecroissant spread to other European countries and tothe rest of the world. In Greece, the first croissants ap-peared in the 1960s, but up until 1983, they could befound only in a handful of bakery and confectioneryshops. In the meantime, many companies in the food-ingredients and food-machine industry seized the op-portunity created by consumer interest in croissantsand began producing ingredients and equipment spe-cially for making croissants. Today, croissants can befound in many places and in many varieties. Their ba-sic ingredients are flour, water, butter or margarine,yeast, and sugar. Fillings of various sweet flavors, suchas chocolate, hazelnut cream, strawberry and apricotjam, as well as salty flavors, are often added to thebasic recipe.

The ProcessChipita makes croissants on seven specialized process-ing lines in its Lamia Industrial Park plant in Greece.

All lines are similar, but for the sake of preciseness inour presentation, we focus on a particular line here.This line consists of several workstations in series in-tegrated into one system by a common transfer mech-anism and a common control system. The movementof material between stations is performed automati-cally by mechanical means. Apart from load and un-load stations, operations at all other stations are auto-mated. There are five distinct stages in makingcroissants: kneading, forming, proofing, baking, andwrapping. Each stage takes place in a separate sectionof the processing line (Figure 1). The process flow ofthe line is as follows:In stage 1, flour and water are automatically fed into

the removable bowl of the spiral kneading machine.Additional ingredients in small quantities, such assugar and yeast, are added manually. After the dough

When a failure occurs, everythingupstream stops.

is kneaded, the bowl is manually unloaded from thespiral machine and loaded onto the elevator-tippingdevice that lifts it and tips it to dump the dough intothe dough extruder of the lamination machine in thenext stage.In stage 2, the dough fed into the lamination ma-

chine is laminated, buttered by a butter extruder,folded, reduced in thickness by a multiroller, and re-folded a few times by a retracting unit to form a mul-tilayered sheet. The multilayered dough is then auto-matically fed into the croissant-making machine,which cuts it into triangles. Finally, the triangles arerolled up and formed into crescents. The entire processis fully automated. A standby operator occasionallyfeeds the butter extruder and makes sure that the pro-cess runs properly. At the exit of the croissant-makingmachine, the croissants are laid onto metal trays, andthe trays are automatically inserted into carts. Astandby operator makes sure that the croissants havethe right shape.In stage 3, the carts are manually pushed into the

proofing cell, where they remain under strict uniformtemperature and humidity conditions for a preciseamount of time as the croissants rise to their final size.


Interfaces64 Vol. 32, No. 3, May–June 2002

Elevator-tipping device

Cart return

Tray return

Dough extruder

Oven Lamination machine

Croissant-making machine

Proofing cell

Kneading machine

Wrapping machines

Load/unload cart

Load/unload bowl

Temperature-controlled room

Butter extruder

Injecting machine

Carton filling

Palettes to warehouse

Raw ingredients

Palette return

Figure 1: The original croissant-processing line.

In stage 4, the carts are manually pushed from theproofing cell to the oven. The trays are automaticallyunloaded from the carts and are placed onto a metalconveyor that passes through the oven. The trays re-main in the oven for a precise amount of time until thecroissants are baked. Upon exiting from the oven, thetrays stay on the conveyor and follow a trajectory fora certain time as the croissants cool. The croissantsmaythen be filled with an optional sweet or salty filling byan automatic injecting machine.In stage 5, the croissants are automatically lifted

from the trays and are flow-packed and sealed by twoparallel, horizontal, electronic wrapping machines. Aspecially trained operator constantly checks the wrap-

ping machines to make sure that the wrapping is doneproperly. The empty trays are automatically returnedto the croissant-making machine.The final products that exit from the croissant-

processing line are loaded onto a conveyor. Fourwork-ers remove them from the conveyor and put them incartons. The filled cartons are placed on a differentconveyor that takes them to a worker who stacks themon palettes and transfers them to the finished-goodswarehouse.There are no in-process buffers between the work-

stations in the line. Consequently, material is trans-ferred directly from station to station. Chipitamonitorsthe entire process constantly to ensure that it meets the



highest quality and sanitation standards. The knead-ing machine, the elevator-tipping device, and the lam-ination machine are kept in a temperature-controlledclean room to ensure that the dough remains free fromcontamination and does not rise. Apart from the fiveoperators working at various points along the line andthe five workers working on filling and stacking thecartons of final products, only five workers are re-quired in the process: a person responsible for raw-ingredients inventory, a person responsible for sani-tation, a mechanic, an electrician, and finally asupervisor, that is, a total of 15 people.The line operates 24 hours a day, with three eight-

hour shifts during the week, and pauses during theweekends. The first shift of the week starts late on Sun-day evening to produce the first finished products forshipment early on Monday morning. The last shift ofthe week ends early on Saturday morning. The rest ofSaturday is spent on scheduled maintenance opera-tions on the line.

The ProblemThe slowest station in the line is the oven. The manu-facturer of the line designed all the other machines“around the oven,” in that he made sure that theywould not process croissants faster than the oven sincethey would anyway be forced to work at the nominalprocessing rate of the oven. The nominal processingrate or throughput of the oven is equal to 12,000 crois-sants per hour. Given that the nominal processing rateof any processing line is equal to the nominal process-ing rate of the slowest workstation in the line, the crois-sant line has a nominal processing rate of 12,000 crois-sants per hour. Unfortunately, because of wear andtear on the individual machines and on the electronicsand hardware for common controllers and transfermechanisms, various pieces of equipment can breakdown in the line. When a failure occurs anywhere onthe line, everything upstream of the failure stops, cre-ating a gap in production down the line. Moreover,material in some parts of the stopped line may have tobe scrapped. Thus, the actual or effective processingrate of the line can be substantially less than the nom-inal production rate.Chipita’s records covering the first 10 months of

1999 show that the effective processing rate of the linefor that period was 10,123 croissants per hour, 84.36percent of the nominal processing rate. Managers no-ticed and tacitly accepted the difference between thenominal rate and the effective processing rate but be-came really concerned about it when demand for crois-sants picked up, reaching levels close to the effectiveproduction capacity. Because of this concern, in earlysummer 1999, we began working on a project with thegoal of finding ways to increase the croissant-processing capacity at Chipita in a cost-effective way.

The AlternativesOne can increase the effective processing rate of atransfer line in four ways: (1) by increasing the pro-cessing rates of the workstations, starting with theslowest; (2) by reducing the frequency of failures; (3)by reducing the duration of failures; and (4) by reduc-ing the impact of failures (Buzacott and Shanthikumar1993, Gershwin 1994). The first three approaches areprimarily determined by good engineering and oper-ating practices. The fourth approach is a matter of de-sign and requires a systems perspective.In the case of the croissant-processing line, to pursue

the first approach, Chipita would have to invest in anew oven with larger capacity, since the throughputof the oven is equal to oven capacity divided by baking

If manufacturers inserted in-processbuffers, they would be admitting thatsome machines fail more often thanothers.

time, by Little’s law (Buzacott and Shanthikumar1993). We considered this to be unappealing both froma financial point of view and because of space limita-tions. To follow the second approach, Chipita shouldpay careful attention to the reliability of machine com-ponents through improved monitoring and on-linecontrol of operations. If it were to adopt the third ap-proach, we should devise appropriate managementand operating practices regarding repair and mainte-nance as well as component inventory control.We con-sidered both approaches as necessary steps towards



overall system improvement, but we put them on holdat the time because they required a long-term study ofmany aspects of the system. This left us with the fourthapproach, to reduce the impact of failures.We considered several design alternatives for reduc-

ing the impact of failures. One alternative was to in-troduce redundant stations in the form of standby sta-tions; however, as was the case with the first approach,we found this to be too expensive to justify, especiallysince the section that caused most of the disruption,the forming section, contained two high-priced piecesof equipment (the lamination machine and thecroissant-making machine) at the heart of the wholeprocess. Another alternative was to use cross-paths, sothat entire sections of different lines would act as back-ups to one another. Using cross-paths means that if thefirst half section of one line and the second half sectionof another identical line are simultaneously down,then a cross-path between their midpoints would al-low the combined two lines to work at one-half capac-ity. In the case of the croissant-processing lines, pro-viding such a situation seemed ineffective becausevery rarely, if ever, did failures in two lines coincidein such a convenient way. Even if there were such acoincidence, however, establishing cross-paths wouldbe impractical because the lines were too far apart andtransferring material between lines would cause qual-ity problems. The last but not least alternative was toinstall in-process buffers between stations. We pur-sued this approach.

The Buffer AlternativeIt is well known among manufacturing systems re-searchers that installing in-process buffers in a transferline can reduce the impact of failures and increase theeffective throughput of the line at the price of extra in-process inventories and delays (Buzacott andShanthikumar 1993, Dallery and Gershwin 1992,Gershwin 1994). This simple fact often escapes the no-tice of manufacturing systems practitioners, perhapsbecause the companies that operate the lines are notthose that design them. Companies like Chipita, whichare in the business of producing bakery products, oftenbuy complete automatic transfer lines from a single

food-machine manufacturer. Food-machine manufac-turers worry more about the processing and engineer-ing aspects of the lines they make than about theiroperations management aspects. Typically, they de-sign transfer lines that consist of several workstationsin series integrated into one system by a commontransfer mechanism and a common control system.Material moves between stations automatically by me-chanical means, and no storage exists in between sta-tions other than that for material-handling equipment(for example, conveyors and load-and-unload carts). Ifthe food-machine manufacturers inserted in-processbuffers, they would have to worry about all sorts oftechnical and technological problems and they wouldbe implicitly admitting that some of their machines failmore often than others. As a result, food-machineman-ufacturers design lines that have no buffers betweenstations, and food-processing companies that buy andoperate such lines take this design for granted.However, installing in-process buffers in a transfer

line can reduce the impact of failures and increase theeffective throughput of the line. In a recent paper,Burman et al. (1998) reported that Hewlett-Packard ob-tained impressive earnings and savings by insertingin-process buffers in an ink-jet printer line.An in-process buffer between two workstations in a

transfer line acts like a spring that decouples the lineinto two sections: an upstream section and a down-stream section. When the downstream section fails, theupstream section continues operating, as long as thein-process buffer has space for the parts it has workedon. If the failure lasts so long that the buffer becomesfull, the upstream section will be blocked and forced

We counted 37 types of failures.

to shut down. When the upstream section fails, thedownstream section continues operating as long as thein-process buffer contains parts for it to work on. If thefailure lasts so long that the buffer becomes empty, thedownstream section will be starved and forced to shutdown. In the absence of an in-process buffer, a failurein either the upstream section or the downstream sec-tion will force both sections to shut down at once. Thebottom line is that on average a line with an in-processbuffer produces more items than the same line without

https://www.researchgate.net/publication/247823868_Hewlett-Packard_Uses_Operations_Research_to_Improve_the_Design_of_a_Printer_Production_Line?el=1_x_8&enrichId=rgreq-6e8013ad-aea1-49b9-9685-19e78377bb77&enrichSource=Y292ZXJQYWdlOzIyODkwODIwNztBUzoxMDM3NzU3NDIyMDE4NjZAMTQwMTc1MzQ3NDM1Mw==



an in-process buffer. A key issue in designing transferlines is where to insert in-process buffers and how bigto make them to most increase the effective processingrate of the line. To find out, one must first studyfailures.

Analysis of Machine FailuresBuzacott and Shantikumar (1993) classify failures ac-cording to their extent, cause, and effect. The extent ofa failure refers to the part or parts of the line that areaffected by the failure. The cause refers to whether thefailure can occur only when the station is processingmaterial or at any time, even when the station is idle.In the first case, the failure is called operation depen-dent, whereas in the second case, it is called time de-pendent. Finally, the effect refers to whether the ma-terial in process at the instant of failure must bereworked, repaired, or scrapped.In our croissant-processing line, we counted 37 dif-

ferent types of failures. Each failure affected only onestation, and most failures were operation dependent.For many failures, at the instant of failure, the materialin process in the failed workstation, and in some casesin other workstations too, had to be scrapped. For in-stance, any failure downstream of the forming section(lamination machine plus croissant-making machine)that lasted for over a certain amount of time wouldcause material in the kneading and forming sections todeteriorate in quality, and it would then have to bescrapped.We collected and analyzed records of failures during

the first 10 months of 1999. The failures ranged in av-erage duration or mean time to repair (MTTR) fromvery short failures, such as the 10-minute adjustmentof the photocell of an ice machine at the kneadingstage, to medium failures, such as the three-hour re-placement of the fan in the proofing cell, to long fail-ures, such as the 16-hour replacement of the ball bear-ings at the dough extruder in the lamination machine.The failures also ranged in average frequency fromvery infrequent failures with long mean times to fail-ure (MTTF), such as the rupture of the conveyor fol-lowing the wrapping machines every 15,845 hours, tomore frequent failures, such as the failure of the ovenburner every 1,584 hours, to very frequent failures,

such as the jamming of the croissant-carrying metaltrays on their way out of the croissant-makingmachineand into the carts every 24 hours.Using the MTTR and the MMTF of every failure in

each of the five sections of the line and assumingoperation-dependent failures, we estimated the avail-ability or efficiency of each section, that is, the per-centage of time it was operational. We found the fol-lowing section efficiencies: kneading: 99.38 percent,

Croissants are not mechanical partsthat can be kept in a bufferindefinitely.

forming: 87.62 percent, proofing: 99.69 percent, baking:99.75 percent, and wrapping: 99.47 percent. From thisanalysis, we realized that the impact of failures in theforming section overshadowed the impact of failuresin any other section. We then estimated the efficiencyof the entire line. It turned out to be 86.32 percent. Asimilar estimation using the assumption of time-dependent failures yielded a line efficiency of 86.13percent. The two estimates were so close because allsections except the forming section had efficienciesclose to 100 percent. In all estimates, we assumed thatno material would be scrapped during a failure andthat the line would run continuously when there wasno failure. Had we taken into account the scrapping ofmaterial during long failures and the gap in produc-tion when the line empties out at the end of the weekand fills up at the beginning of the week, the efficiencyof the line would turn out to be slightly lower. Indeed,Chipita’s records showed that the output efficiency re-ported for the same period was 84.36 percent, approx-imately two percent lower than the efficiency we esti-mated (86.32 percent).

Design of Buffer LocationOur analysis showed us that the drop in efficiency ofthe line came almost exclusively from disruptions inproduction caused by failures in the forming section.To reduce the impact of these failures, all we had todo was insert an in-process buffer right after the form-ing section and before the proofing cell. The idea was



to speed up the part of the line upstream of the bufferso that it would fill the buffer with formed croissantsfaster than the proofing cell would deplete it. Once thebuffer was full, we would reduce the speed of the lineupstream of the buffer back to the nominal speed of12,000 croissants per hour. This way, if there were afailure in the forming section, the rest of the line down-stream of the failure would be fed by the in-processbuffer for some time and not be forced downimmediately.In addition, if a buffer were to be inserted between

the forming section and the proofing cell to store trayswith formed croissants, then another “mirror buffer”would also have to be inserted between the wrappingsection and the forming section to store the emptytrays. This buffer would be filled with empty trays atthe speed of the oven divided by the tray capacity (incroissants per tray) andwould be depleted at the speedof the forming section divided by the tray capacity.We almost had the answer to our problem. Before

setting out to design the capacity of the buffer betweenthe forming section and the proofing cell (and the ca-pacity of the mirror buffer), we had to address certaintechnological and technical issues first.

Technological and Technical IssuesThe first category of issues concerned the process tech-nology for making croissants. Croissants are not me-chanical parts that can be kept in a buffer indefinitely.The formed croissants exiting from the forming section(lamination machine plus croissant-making machine)must immediately enter the proofing cell, where theymust remain under strictly uniform conditions of tem-perature and humidity for an exact amount of time torise properly to their final size. If we inserted an in-process buffer between the forming section and theproofing cell, the croissants would spend time in thebuffer before entering the proofing cell and would nolonger rise properly. This was unacceptable. We hadto find a solution.The solution did not take long to surface. In one

word, it was refrigeration. Dough can keep its charac-teristics for over 48 hours if it is kept refrigerated at nomore than 5�C (41�F). Therefore, if the in-process buffer

was a refrigerator operating at around 5�C, the crois-sants would keep for some time without rising or de-teriorating. While making inquiries about the buffer-refrigerator option, we found out that some bakeriesand confectionery shops form dough products duringthe day and keep them refrigerated until they want tobake them. The purpose of doing this is not to increaseproductivity, which was our goal, but rather to avoidstarting the kneading process very early in morning,mumbling “time to make the doughnuts,” to quote anold TV commercial. Moreover, frozen (and part-baked)dough is used in restaurants and the retail trade forbaking by in-store bakeries, hot bread shops, and ki-osks, so that they can provide freshly baked bread atany time (Euromonitor 1999). In our case, a refriger-ated buffer would keep dough from rising and dete-riorating, and it would also keep it protected and cleanjust as the proofing cell does. In a sense, the buffer-refrigerator would be an additional processing stagewhose main purpose would be to provide storage sothat the line would not have to process the croissantsright after the forming section.Before inserting a buffer-refrigerator between the

forming section and the proofing cell, we had to de-termine several parameters to ensure that the crois-sants would retain their dimensions and other qualitycharacteristics (for example, humidity and texture)throughout their lifetime (which with the original linedesign was 90 days). These parameters were (1) theexact portion-control standards, that is, the mix of in-gredients in the recipe for croissants, particularly thepercentage of yeast, which causes the dough to rise;and (2) the exact conditions in the buffer-refrigerator,particularly the temperature and humidity. In addi-tion, we wanted to reexamine the exact atmosphericconditions in the proofing cell following the buffer-refrigerator because storage in the buffer-refrigeratorwould change the condition of the formed croissantsentering the proofing cell.We first considered the mix of ingredients in the ba-

sic recipe for the croissants. We found that for doughthat is cooled and stored in the buffer-refrigerator forshort periods of time (a few hours at most), whichwould be the usual case during day-to-day operations,the recipe used for the nonrefrigerated dough in theoriginal system seemed to work fine and the loss in



quality of the final product was negligible (if any atall).For dough that is cooled and stored in the buffer-

refrigerator for longer periods (one to two days),which would be the case for dough stored over theweekend, however, the recipe used for the nonrefri-gerated dough in the original system should be slightlymodified. Cooling, storing, and thawing over long pe-riods of time decreases the strength of the dough, theviability of the yeast, and the volume of the final prod-uct. To counteract these effects and maintain the qual-ity of croissants made from refrigerated dough, Chip-ita would have to modify the basic recipe in variousways, the most important of which are the following:(1) Use medium to strong flour with higher proteinquality, which is apparently more important than pro-tein content. (2) Use higher yeast quality to insure yeastactivity at the same level as that in nonrefrigerateddough. (3) Use a slightly greater percentage of fat toimprove dough structure. (4) Use a slightly greaterpercentage of enhancement agents and oxidants tomaintain yeast viability after thawing and to accom-plish complete and uniformmaturing of the dough. (5)Use a slightly greater percentage of sugar, and use dex-trose instead of sugar to help dough mature. (6) Addmilk powder to improve the external color of bakedproducts.We also found that dough cooled and stored in the

buffer-refrigerator over the weekend is slightly com-promised in final product quality, though not enoughto make the final products unacceptable. Specifically,the final products are slightly more elastic and lesstasty than those produced from nonrefrigerated doughin the original system. Moreover, their expected life-time drops around 20 percent. The croissants stored inthe buffer-refrigerator over the weekend, however,represent only four hours of production per week.As far as the conditions in the buffer-refrigerator are

concerned, to cool the croissants quickly and uni-formly, (1) Chipita should equip the buffer-refrigeratorwith powerful fans to circulate air among the crois-sants, and (2) it should replace its Teflon-coated irontrays holding the croissants, with perforated, silicon-coated, aluminum trays, which cost more but conductheat better. Moreover, the carts of croissants cooledand stored in the buffer-refrigerator over the weekend

should be covered with plastic or cellophane bags tokeep the croissants from drying out and forming ahard skin. Finally, croissants coming from the buffer-refrigerator should spend slightly more time in theproofing cell than those that come directly from thecroissant-making machine.The second category contained technical issues that

required engineering solutions. For the buffer solutionto increase the throughput of the line, we had to speedup the part of the line upstream of the buffer. Wewanted to know whether we could do this technicallyand, if so, by how much. The part of the line upstreamof the buffer consists of two sections: kneading andforming. We could speed up kneading easily by in-creasing the quantities of ingredients mixed by thekneading machine. The manufacturer of the line as-sured us that we could also speed up the forming sec-tion by up to 40 percent after replacing three constant-speed motors with three variable-speed motors. Thismeant we could increase the nominal processing rateof the part of the line upstream of the buffer from12,000 to 12,000 � 1.4 � 16,800 croissants per hour.Another less important technical issue was how to

automatically adjust the speed with which the mirrorbuffer unloaded empty trays. Automatic control sys-tems are commercially available that detect the dis-tance between returning trays and compare their speedto the speed of the forming section.Apart from these technological and technical issues

we had to resolve an important managerial issue. Wehad to determine the capacity of the buffer-refrigeratorand evaluate its impact on the processing rate of theline.

Design of Buffer CapacityTo calculate the effect of the size of the in-process buf-fer on the effective processing rate of the line, we usedGershwin’s (1994) analytical two-machine,continuous-flow line model. This model assumes atransfer line of two machines in series with a finite-capacity buffer between them. The model treats thematerial processed by the machines as though it werea continuous fluid. Each machine can operate at a max-imum nominal processing rate when it is not con-strained by the other machine or the buffer. Both ma-chines have random failures and repairs. The model

https://www.researchgate.net/publication/245372171_Manufacturing_Systems_Engineering?el=1_x_8&enrichId=rgreq-6e8013ad-aea1-49b9-9685-19e78377bb77&enrichSource=Y292ZXJQYWdlOzIyODkwODIwNztBUzoxMDM3NzU3NDIyMDE4NjZAMTQwMTc1MzQ3NDM1Mw==



assumes that the times to failure and the times to repairof the machines have exponential probability distri-butions. This practically means that their failure andrepair rates are constant.A machine is said to have a constant failure (or re-

pair) rate if the likelihood that the machine fails (or isrepaired) in the next instant is independent of howlong it has been running (or has been under repair).This implies that the machine has no memory of thetime since the last failure (or repair) and for this reasonthe exponential distribution, which is the only distri-bution that yields constant failure (or repair) rates,is often said to possess the so-called memorylessproperty.In a comprehensive study of the failure data for

transfer lines that machine transmission cases atChrysler Corporation, Hanifin (1975) found that the uptimes, that is, the times between failures in many caseshad exponential distributions. Here is the explanation:When complex pieces of equipment, which are com-posed of many subcomponents, fail, the firm replacesonly the affected components, not the entire system.After a while, the equipment becomes a mix of old andnew components, with a wide range of life expectan-cies. The time elapsed since the last failure becomesirrelevant for predicting future failures, because it re-veals nothing about the age of most of the componentsin the equipment. Hence the expected time until the

The project revealed the esoterictechnology of operations research tothe technical management.

next failure becomes independent of the length of thetime since the last failure. In the same study, Hanifin(1975) also found that the observed down times weredue to a mixture of different repairs, where the timeto make each repair usually had an exponentialdistribution.Coming back to Chipita’s system, the first machine

in Gershwin’s model represents the part of thecroissant-processing line upstream of the buffer-refrigerator, that is, the kneading and forming sections,and the second machine represents the part of the linedownstream of the buffer-refrigerator, that is, the

proofing, baking, and wrapping sections. Thus, weused Gershwin’s model of a two-machine line with asingle buffer as a surrogate for the original line. Thefirst machine would have a maximum nominal pro-cessing rate of 16,800 croissants per hour with theplanned engineering modifications. The maximumnominal processing rate of the second machine had toremain at 12,000 croissants per hour, because it wasconstrained by the speed of the oven in the bakingsection.We calculated the MTTF and the MTTR of the two

machines in the model using Chipita’s failure records.In the case of the second machine, we calculated themdirectly from the records. In the case of the first ma-chine, however, we had to modify the data from thefailure records because they concerned the sectionwhen its nominal processing was 12,000 instead of16,800 croissants per hour. We increased the frequencyof failures of the kneading and forming sections by thesame factor that we increased its processing rate: 1.4.Instead of deriving empirical reliability distributionsdirectly from failure data, we assumed that the timesto failure and the times to repair had exponential dis-tributions. We considered this to be a reasonable as-sumption, particularly for failure times, because a lotof components could fail in each section of the line.Specifically, the kneading and forming sections had 23different types of failures with ratios of MTTR �

MTTF ranging from 7,89E-5 to 4,17E-2. The proofing,baking, and wrapping sections had 14 different typesof failures with ratios of MTTR � MTTF ranging from3.16E-5 to 2.08E-3.

The ResultsGershwin’s model allowed us to calculate the meaneffective production rate of the two-machinecontinuous-flow line—a surrogate for the originalcroissant-processing line—as a function of the in-process buffer capacity (Figure 2). It also allowed us tocalculate the mean time that a croissant spends in thebuffer as a function of the in-process buffer capacity(Figure 3). We give details on the model and the ana-lytical methodology used to solve it in the Appendix.The mean processing rate of the line increases at a

diminishing rate with buffer capacity, approaching the



10,000

10,400

10,800

11,200

11,600

12,000

0 20,000 40,000 60,000 80,000 100,000 120,000 140,000

Buffer Capacity

Mea

n E

ffec

tive

Pro

cess

ing

Rat

e

Figure 2: The mean effective processing rate (croissants per hour) of the croissant-processing line approachesthe effective processing rate of the part of the line downstream of the buffer (12,000 croissants per hour) as thebuffer capacity (croissants) increases.

effective processing rate of the part of the line down-stream of the buffer, that is, 12,000 � 0.9969 � 0.9975� 0.9947 � 11,870 croissants per hour, where the lastthree terms in the product are the efficiencies of thethree sections downstream of the buffer (Figure 2). Themean storage time, on the other hand, increases almostproportionately with buffer capacity (Figure 3).Based on our results, we thought that a buffer ca-

pacity of 40,000 croissants would be enough to raisethe effective processing rate from 12,000 � 0.8632 �

10,358 to 11,700 croissants per hour, that is, by a factorof 12.96 percent, and the corresponding efficiency from86.32 percent to 97.5 percent, at a cost of an extra meanstorage time of one hour in the buffer. Moreover, abuffer capacity of 40,000 croissants would requireabout the same amount of physical space as the proof-ing cell. Such a space was available. Finally, with abuffer capacity of 40,000 croissants, themaximum stor-age time in the buffer, if the part of the line down-stream of the buffer had not failed, would be 40,000croissants � 12,000 croissants per hour � 3.33 hours.This is the time that a croissant entering the buffer

would have to wait in order for all other croissantsahead of it to move out of the buffer, if the buffer werefull. This was more than good news, because doughcan be stored in a refrigerator without loss of qualityfor up to 48 hours.We further argued that raising the buffer capacity

beyond 40,000 to, say, 60,000 croissants, would yield again of less than one percent in effective processingrate, namely, from 11,700 to 11,801 croissants per hour(Figure 2), but would increase the mean storage timeby 70 percent, namely, from 1.0 to 1.7 hours (Figure 3).Most important, it would require extra space andpower to accommodate and refrigerate 50 percentmore croissants.Based on our analysis, we concluded that an in-

process buffer-refrigerator with a capacity of 40,000croissants between the forming section and the proof-ing cell would do the job. Chipita would also needadditional trays and carts to carry 40,000 croissantsand a mirror buffer large enough to store the addi-tional trays. We also calculated the costs and benefitsof the modified design of the croissant-processing line,



0

1

2

3

4

5

6

0 20,000 40,000 60,000 80,000 100,000 120,000 140,000

Buffer Capacity

Mea

n B

uffe

r St

orag

e T

ime

Figure 3: The mean time (hours) a croissant spends in the in-process buffer increases linearly with the size ofbuffer capacity (croissants).

with the in-process buffer-refrigerator and the mirrorbuffer of empty trays (Figure 4).

The BenefitsThe benefits of installing an in-process buffer-refrigerator with a capacity of 40,000 croissants be-tween the forming section and the proofing cell aremultifold.First, the financial benefits. We estimated that the

resulting increase in the effective processing rate of theline would bring in extra earnings of approximately$18,000 per week, but it would also save money.Having an in-process buffer filledwith croissants be-

fore the proofing cell meant that Chipita would nolonger have to start running the empty line late on Sun-day evening in order to have the first croissants comeout early on Monday morning. Instead, if the workerson the last shift on Saturday had left the buffer filledwith formed croissants, only one person, instead of theentire shift, would have to show up at 2:00 am onMon-day morning and start moving carts with croissantsfrom the buffer to the proofing cell. The regular shiftcould then come in early on Monday morning and

start packing croissants. We estimated savings inwages from eliminating the Sunday evening shift at$750 per week. But the buffer solution implied yetmore savings.In the absence of the buffer, every time a failure oc-

curs in the proofing cell, the oven, or the wrappingmachines, the entire line upstream of the failure isforced to shut down. If the failure lasts for over anhour, all material trapped in the kneading and formingsections must be scrapped because it deteriorates inquality. When this happens, the line loses about 55minutes worth of production, which amounts to ap-proximately $1,180 in lost revenues and $720 in ma-terial costs, that is, a total of $1,180 � $720 � $1,900.Our records showed that the frequency of failures last-ing over an hour in the proofing cell, the oven, or thewrappingmachines, was approximately 11 failures peryear. This means that the average weekly cost of scrap-ping material was $1,900 per failure � 11 failures peryear � 52 weeks per year � $400 per week. With thein-process buffer, the part of the line upstream of thebuffer would keep working even if there were a failuredownstream of the buffer, as long as there was space



Mirror buffer of empty trays

Tray return

Cart return

Dough extruder

Oven Lamination machine

Croissant-making machine

Proofing cell

Kneading machine

Wrapping machines

Load/unload cart

Elevator-tipping device

Load/unload bowl

Temperature-controlled room

Butter extruder

Injecting machine

Carton filling

Palettes to warehouse

Raw ingredients

In-process buffer-refrigerator

Palette return

Figure 4: In the modified croissant-processing line, an in-process buffer-refrigerator is inserted between thecroissant-making machine and the proofing cell.

in the buffer, so that material would not have to bescrapped. The savings from not scrapping materialwould therefore be approximately $400 per week.Thus, the net weekly benefits would be $18,000 �

$750 � $400 � $19,150 per week, which translates tojust under $1 million per year. Given that we estimatedthe cost of a refrigerator big enough to hold 40,000croissants at $91,250, we calculated that an investmentin such a refrigerator would break even in five weeks($91,250 � $19,150 per week), a very appealing pros-pect. Moreover, given that a new line costs approxi-mately $2 million, Chipita could buy a new line in twoyears after implementing the buffer solution, with the$1 million yearly benefits of the solution.

Finally, the picture of the financial benefits of in-stalling an in-process buffer would not be complete ifwe did not multiply all these earnings and savings byseven, since currently the plant has seven croissant-processing lines. Moreover, since most of Chipita’sother bakery products have similar processes, our buf-fer solution could easily be applied to those processinglines too and bring in extra earnings and savings.Besides its financial benefits, the buffer solution

would have a positive effect on the morale of the peo-ple working on the line because it would minimize theupheaval and stress associated with shutting down theentire line, because it would allow parts of the line torun even when there was a failure.



In addition, the buffer solutionwould allowworkersto briefly stop the part of the line upstream of the buf-fer, when the buffer was full enough, to do preventivemaintenance or minor readjustments that could reduceoverall failures.Finally, we benefited and learned a lot from the pro-

ject and from each other, a manufacturing-systems re-searcher and a manufacturing-systems practitioner.Our collaboration continues on the implementation ofthe solution and on a longer-term follow-up study ofreliability, maintainability, and component-inventory-control issues related to the lines. The project revealedthe seemingly esoteric technology of operations re-search to the technical management of Chipita and toa lesser extent one of its major food-equipment sup-pliers, who we occasionally consulted on the projectand who was very interested by the findings. The pro-ject opened the doors of operations research forChipita’s technical management.

AppendixGershwin’s (1994) analytical two-machine, continuous-flow-line model assumes a transfer line consisting oftwo machines in series with a finite-capacity buffer be-tween them. The capacity of the buffer is N. The ma-terial processed by the machines is treated as thoughit were a continuous fluid. Machine i can operate at amaximum nominal processing rate li when it is notconstrained by the other machine or the buffer. Bothmachines have random failures and repairs. The stateof machine i at time t is denoted by �i(t). If �i(t) � 1,the macine is operational or up; if �i(t) � 0, the ma-chine has failed (or is down or remains under repair).The buffer level at time t is denoted by x(t) and

changes at a rate dx(t)/dt � u1(t) � u2 (t), where ui(t)is the processing rate of machine i at time t. More spe-cifically, when 0 � x � N, u1(t) � �1(t)l1 and u2(t) �

�2(t)l2; when x � 0, u1(t) � �1(t)l1 and u2(t) �

min[�1(t)l1, �2(t)l2]; when x � N, u1(t) � min [�1(t)l1,�2(t)l2] and u2(t) � �2(t)l2.The repair time of machine i is exponentially distrib-

uted with a constant repair rate ri. The time to failureof machine i is exponentially distributed with anoperation-dependent failure rate of piui(t)/li, where pi

is the maximum failure rate when the machine is op-erating at its maximum nominal processing rate. Atany time t, the state of the system is (x(t),�1(t), �2(t)).We calculated the maximum failure rate and the re-

pair rate of each machine from the data as follows:Up� j

Uj�JUp � b p , r � ,1 � j 1 U UUj�J p /r� j jUj�J

Dp� jDj�JDp � p , r � ,2 � j 2 D DDj�J p /r� j j

Dj�J

where and denote the failure rate and repair rate,U Up rj j

respectively, of the jth type of failure upstream of thebuffer, and JU is the set of all failures upstream of thebuffer. Similarly, and denote the failure rate andD Dp rj j

repair rate, respectively, of the jth type of failure down-stream of the buffer, and JD is the set of all failuresdownstream of the buffer. Coefficient b denotes thefactor by which we have to increase the processing rateof the first machine, that is, 1.4.Gershwin sets up differential equations for the

steady-state probability distribution of the state of thesystem, f(x, �1, �2), and solves these equations usingboundary conditions at x � 0 and x � N and the nor-malization condition, which states that the cumulativedistribution over the entire state space must be equalto 1. Once the steady-state probability distribution ofthe state is known, the mean effective production rateof the line and the mean buffer level can be foundeasily.We wrote a program using the software Mathema-

tica to solve for the steady-state probability distribu-tion and compute the mean effective production rateof the line and the mean buffer level for different val-ues of the buffer size. The solution converged with noproblem, and we obtained the smooth curves shownin Figure 2 and Figure 3.A wide range of two-machine, single-buffer models

like the one we described can be solved analytically.For longer transfer lines, exact analytical solutions arepractically impossible to develop, so analysts use ap-proximate methods to solve them. Most of these meth-ods are based on decomposition. A typical decompo-sition method decomposes the original line of, say, K



machines and K-1 buffers into K-1 two-machine,single-buffer subsystems. In each subsystem, the bufferrepresents one of the buffers in the original line, thefirst machine represents the part of the original lineupstream of that buffer, and the second machine rep-resents the part of the original line downstream of thatbuffer. Each subsystem is analytically tractable once itsparameters have been determined. The method de-rives a set of equations that determines the unknownparameters of each subsystem from the parametersand performance measures of other subsystems anduses an algorithm to solve these equations.The earliest studies of stochastic models of transfer

lines were reported in the former Soviet Union in theearly ’50s. Since then, a great deal of literature ontransfer-line analysis has accumulated. Buzacott andGershwin have contributed much to the research inthis area (Buzacott and Shanthikumar 1993, Gershwin1994). Dallery and Gershwin (1992) give a comprehen-sive review of models developed for transfer lines andflow lines.

ReferencesBurman, M., S. B. Gershwin, C. Suyematsu. 1998. Hewlett-Packard

uses operations research to improve the design of a printer pro-duction line. Interfaces 28(1) 24–36.

Buzacott, J. A., J. G. Shanthikumar. 1993. Stochastic Models of Manu-facturing Systems. Prentice Hall, Englewood Cliffs, NJ.

Dallery, Y., S. B. Gershwin. 1992. Manufacturing flow line systems:A review of models and analytical results. Queueing SystemsTheory Appl., Special Issue on Queueing Models of ManufacturingSystems 12(1–2) 3–94.

Euromonitor International. 1999. Bakery Products and Biscuits: The In-ternational Market. Market direction report, Euromonitor Inter-national �www.euromonitor.com� (September), London, U.K.

Gershwin, S. B. 1994. Manufacturing Systems Engineering. PrenticeHall, Englewood Cliffs, NJ.

Hanifin, L. E. 1975. Increased transfer line productivity using sys-tems simulation. Ph.D. thesis, University of Detroit, Detroit,MI.

Panagiotis Tsarouhas, Technical Director, ChipitaInternational, Inc., Lamia Industrial Park, GR-35100Lamia, Greece, writes:“This is to attest to the impact of our work with Pro-

fessor G. Liberopoulos to increase the production rateof the packaged croissants processing lines at ChipitaInternational’s plant in Lamia, Greece. . . .“This research has come at a critical time when the

demand for packaged croissants is growing rapidly.This increase in demand is reflected in the rapid gowthof Chipita’s packaged croissants-related operationsworld-wide. Here is some hard evidence of this:• On January 5, 2001, Chipita International’s subsidi-ary Chipita Russia Ltd. purchased 100% of the sharecapital of two Russian companies, ZAO Krasnosel-skaya and ZAO Eldi. Starting in autumn of this year anew packaged croissants production line is expectedto be operating in the Eldi factory. Sales of the Russiancompany are expected to reach USD 8 million this yearand USD 14 million in 2002, while pretax profits areestimated to reach USD 500,000 this year and USD 1.2million in 2002.• Delyug, Delta Participation’s subsidiary in Yugosla-via, will commence distributing Chipita’s range of in-dividual packaged croissants and mini croissants inYugoslavia through its distribution network. This yearsales are expected to reach GRD 1.3 billion (EURO 3.8billion). Yugoslavia will experience rapid developmentin the next few years. In this event, the establishmentof a factory for packaged croissants, together with theparticipation of Delta, will be considered close toDelta’s existing ice cream plant.• Recently, Chipita International had an agreeementwith Pepsico Inc. to create a joint venture for the pro-duction of packaged croissants in a Latin Americancountry. Possibilities exist for expanding this cooper-ation to other countries in Latin America, the U.S.A.and Europe.• Chipita International signed an agreement for thebuy-out of its principal competitor in Romania, BestFoods Romania, which owns and operates a manufac-turing facility for packaged croissants and other bak-ery products in Bucharest. With this move, Chipita in-creases its share of the fast-expanding Romanianmarket for packaged croissants to over 80%.“The above evidence shows how important it is for

our company to be able to increase the production rateof packaged croissants and increase our market sharein an expanding market for them.“As strange as it may sound now, the solution of

https://www.researchgate.net/publication/220084202_Manufacturing_Flow_Line_Systems_A_Review_of_Models_and_Analytical_Results?el=1_x_8&enrichId=rgreq-6e8013ad-aea1-49b9-9685-19e78377bb77&enrichSource=Y292ZXJQYWdlOzIyODkwODIwNztBUzoxMDM3NzU3NDIyMDE4NjZAMTQwMTc1MzQ3NDM1Mw==



inserting an in-process buffer to help increase the pro-ductivity of the packaged croissants processing lineswould never have occurred to us had we not been in-volved in this project.“Now, we are in the process of preparing to imple-

ment this solution. The technical issues associatedwithspeeding up the lamination, and the croissant-makingmachines can be resolved by our processing equip-ment supplier, so we are mostly working on qualityassurance issues. Since the quality and uniformity ofour products is our number one concern, it may takeus some time to optimize our processing parametersto ensure the same high quality standards that we areachieving now. We are confident, however, that wecan resolve these issues.

“At this time I can see no reason why we should notbe able to reap all the benefits that we mention in thepaper. Although the financial benefits are of primaryconcern to our company as a whole, being a technicaldirector responsible for running the lines, I particularlyvalue the benefit of being able to keep the lines runningeven when there is a stoppage on the part of the lineupstream of the buffer.“Let me conclude by saying that this collaboration

has been extremely useful for us, as we have learnedto understand and analyze our lines. This collaborationcontinues to date and is focused on a more detailedanalysis of failure and repair data.”

Documents

Systems Analysis Speeds Up Chipita's Food-Processing Line