Drum Buffer Rope Application at Intel Warehousingtocico.net/DBR_TOCICO_Nov2009_SEdwards1 [Compatibility Mode].pdf · Drum Buffer Rope Application at Intel Warehousing SCOTTEDWARDS

Drum Buffer Rope Application at Intel Drum Buffer Rope Application at Intel Warehousing Warehousing

SCOTTEDWARDS

A case study about how a team from Intel Corporation was able to improve performance in a

finished goods warehouse operation by applying Th f C t i t D B ff RTheory of Constraints Drum-Buffer-Rope

CUSTOMER FULFILLMENTPlanning and Logistics Group

Organizations everywhere encounter challenges to improveimprovetheir performanceperformancepp


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Process improvement professionalsprofessionalsmust apply effective concepts to improveimprove performancep pp p


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Organizations are reluctantreluctant to changechange or try new things


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You want your organization’s performanceperformance to improveimprove


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Apply key conceptskey concepts from myApply key conceptskey concepts from my experienceexperience in implementing DBR implementing DBR in a warehouse operation to dramatically improvedramatically improve performancedramatically improve dramatically improve performance


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Key Conceptsy p

1.1. TimelyTimely and accurate datadata1.1. TimelyTimely and accurate datadata

2.2. UtilizeUtilize existing continuous improvement continuous improvement programs & methods

33 TrainingTraining through “GameGame” exercises3.3. TrainingTraining through GameGame exercises


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Worldwide Manufacturing OperationWorldwide Manufacturing OperationWarehouse NetworkWarehouse Network


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Intel’s Supply ChainIntel’s Supply Chain

SupplierSupplier FactoryFactory ShipmentShipmentDeliveryDelivery

FabFab WarehouseWarehouseOperationsOperations

CustomerCustomer

OperationsOperations


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Warehouse OperationWarehouse Operation

FACTORYFACTORY ShipmentShipmentDeliveryDelivery

Receiving InventoryStorage

Placement Order Pick OrderStaging

ProcessingPartial/Partial/

CombineCombine Pack Label

ProcessingLine


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1. DataData

Provide a timely and accurateProvide a timely and accurate measurement system to assess performanceperformance


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Demonstrate immediateimmediate impactp

Cycle time / Hour

Date=08/16/2006

D 08/17/2006

7

8

9

10

6

7

Cycle time / Hour

Date=08/17/2006

3

4

5

6

Mea

n(C

T)

4

5

ean(

CT)

0

1

2

-5 0 5 10 15 20Hour

1

2

3Me

Hour

05 10 15 20 25

Hour


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SPC and Buffer ReportsSPC and Buffer Reportspp

Cycle Time Cycle Time Control ChartControl Chart

Buffer ReportBuffer Reportu e epo tu e epo t


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2. Continuous improvementContinuous improvementpp

Utilize existing process improvementUtilize existing process improvement methods already in place or more fully understood, use the dataunderstood, use the data


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“Lean” (VSM, Waste elimination)( , )


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DMAIC

DD – Identify constraint 4 86885y

MM – Set baseline

AA D t i k i bl th t

Cycl

eTi

me

(Day

s)

4.86885

0.27381

1.828465±0.2982

2 4 hAA – Determine key variable that impact constraint

l d b l5

6

)

1

2 4

High

Low

II – Apply DBR, reduce variability

CC – Sustain performance (SPC)0

1

2

3

4

Cyc

le T

ime

(hou

rs

-1

0

2 4 6 8 10 12 14 16 18 20 22 24 26Sample


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3. Games

Use “Game” or simulation trainingUse Game or simulation training methods to introduce power of DBR and turn skeptics into believersturn skeptics into believers


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Drum Drum –– Buffer Buffer –– RopeRopepp

45* 75 25 30 50 25

A B C DProcess step: E

* Rate (e.g. orders per hour)


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Rate (e.g. orders per hour)

Simulation Set Upp7 Players:1 Ground Controller1 Ground Controller5 MS (1 per process)1 Flow Control Monitor

PICK PPR Partial/Comb. Pack Label FCMGC

PROCESS DNs

CHARTDATA

RELEASEDNs


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Simulation ExampleSimulation Examplepp

With DBR


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Immediate ImplementationImmediate Implementationpp

Buffer Calculation ToolBuffer Calculation Tool


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ResultsResults


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Oneway Analysis of REPACKFINISH By Implementation / DemandOneway Analysis of Cycle Time (hours) By Implementation

Order Processing Cycle Time Improvement

KFI

NIS

H

40

50

60

Oneway Analysis of REPACKFINISH By Implementation / Demand

e (h

ours

)

15

20

25

Oneway Analysis of Cycle Time (hours) By Implementation

RE

PA

CK

0

10

20

30

All Pairs

Cyc

le T

ime

0

5

10

All Pairs (1) Before / High (1) Before / Low (2) After / High

Implementation / Demand

All PairsTukey-Kramer 0.05

Missing Rows 235

A l i f V i

Oneway Anova

(1) Before (2) After

Implementation

All PairsTukey-Kramer 0.05

S DF S f S M S F R ti P b > F

Analysis of Variance

Oneway Anova

Implementation / DemandErrorC. Total

Source 2

2712 2714

DF 17955.96 183746.69 201702.65

Sum of Squares 8977.98 67.75

Mean Square132.5101

F Ratio <.0001Prob > F

Analysis of Variance

Means and Std Deviations

ImplementationErrorC. Total

Source 1

191 192

DF 72.4485

1257.4650 1329.9135

Sum of Squares 72.4485 6.5836

Mean Square 11.0044

F Ratio 0.0011Prob > F

Level Number Mean Std Dev Std Err Mean Lower 95% Upper 95%

Means and Std Deviations

Avg Cycle Time (pick to repack finish) reduction ~43% (~61% St dev)

(1) Before / High(1) Before / Low(2) After / High

Level 1032 1360 323

Number 14.8605 10.1691 16.4025

Mean 8.3681 7.2929 11.0433

Std Dev0.260490.197760.61447

Std Err Mean 14.349 9.781 15.194

Lower 95% 15.372 10.557 17.611

Upper 95%(1) Before(2) After

169 24

4.28254 2.42583

2.70792 1.05394

0.208300.21513

3.8713 1.9808

4.6938 2.8709


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Avg Cycle Time (pick to repack finish) reduction 43% ( 61% St dev)

Avg Hourly Throughput Increase (DNs/hour) ~10%

Total Warehouse Cycle Time Improvement

Day

s) 3

3.5

4

OPD Weekly Average Cycle Time(DN Create to AGID)

Cyc

le T

ime

(D

0.5

1

1.5

2

2.5

Al l P i2.5

3

3.5

4

4.5

(D

ays)

(1) Before (2) After

Impleme ntation

Al l Pai rsTukey-Kram er 0.05

Impleme ntationSource

1DF

10.1753 54Sum o f Squares

10.1754M ean S quare

32.1509F Rati o

<.0001Prob > F

Analysis of Varianc e

0.5

1

1.5

2

2.5

Cycle

Tim

e

C. T otal 40 22.5183 70

(1) Before(2) After

Level 33

8

Num ber 2.654031.39694

M ean0.5753060.500250

Std Dev0.100150.17686

Std E rr M ean 2.45000.9787

Lower 95% 2.85 1.81

Upper 95

Means a nd Std Deviations

ErrorC. T otal

39 40

12.3430 17 22.5183 70

0.31650

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Work Week

Before OIM OIM

Avg Cycle Time reduction ~48% (~14% St dev)

~1.25 day total reduction in inventory~1.25 day total reduction in inventoryIncreased Inventory availability

Without additionalexpense


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Increased Inventory availability

Cycle time stable

p

Additional Warehouse ExamplepWarehouse Throughput

Constraint elevated thistitime

33%33%33%33%increase in throughput


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Qualitative Results of DBRQualitative Results of DBR

BEFOREBEFORE AFTERBEFOREBEFORE

• Operations metrics were not directly effected by daily activity

• Clear link between operations performance and

activity

• Large unexplainable difference in cycle time from

metrics

• Site to site differences are small and can be explainedSite to site

• Difficult Order prioritization

• Each operation/station was

small and can be explained

• Easy order prioritization

• Si lifi d DC M t• Each operation/station was focused on only their process

• Simplified DC Management

• Increase in site team work


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Additional Key Additional Key LearningsLearningsyy gg

• Robust production solutions are portable from p pmanufacturing to warehousing

• Step function improvements don’t have to beStep function improvements don t have to be complex or expensive

• The proper motivation can cause culture changeThe proper motivation can cause culture change quickly

• Don’t break the constraint make it the• Don t break the constraint, make it the operational focus


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Successful DBR Implementation ppossible through:

1.1. TimelyTimely and accurate datadata

2.2. Utilization Utilization ofof existing continuous continuous improvement improvement programs & methods

3.3. TrainingTraining through “GameGame” exercises


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Questions?Q

Contact InfoContact Info

E‐mail: [email protected]

Linkedin: http://linkedin/in/scottjosephedwardshttp://linkedin/in/scottjosephedwards

Twitter: @scottjedwards


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Documents

Drum Buffer Rope Application at Intel Warehousingtocico.net/DBR_TOCICO_Nov2009_SEdwards1 [Compatibility Mode].pdf · Drum Buffer Rope Application at Intel Warehousing SCOTTEDWARDS