The day began with a presentation by Filippo Focacci, product manager for ILOG's planning and scheduling solution, ILOG Plant PowerOps (PPO). His presentation, "Factory Scheduling in the Food & Beverage and Pharmaceutical Industries" focused challenges, solutions and lean initiatives in these process industries.
Companies in this space face high demand variability, complex manufacturing processes, a focus on performance management and cost control, product mix changes and new product introductions/phase outs, and complex product quality issues. ILOG's PPO is designed to model key manufacturing constraints and to be used as a decision support system. Its strength is its optimization and performance analysis. It's not intended to replace current IT infrastructure but to augment it through integration with existing systems.
Filippo first covered an example from the fresh dairy industry, which moves its products from the cow through pasteurizers and fermentation, into storage and filling lines, into the finished product. The industry faces lengthy – up to day-long – cleaning-in-place cycles for its equipment, and these cycles are key to the industries process and are triggered by certain events (e.g., equipment sits idle for eight hours). Companies in the industry face high-demand variability, short shelf life of intermediate products and finished products, and relatively long lead times of three to four days. From a manufacturing efficiency point of view, companies in this space are looking to maximize resource utilization while minimizing waste and maximizing manufacturing predictability. Quality is a key issue, too, of course.
The company in question is using PPO for integrated planning and scheduling to find the right tradeoffs between scheduling goals (efficiency, changeover costs, etc.) and supply chain goals (e.g., balancing min/max days of supply). The tool lets the company also balance finished product and intermediate product planning. Planners can run various scenarios based on different constraints or goals and compare select KPIs across the scenarios. Benefits include the ability to have manufacturing and supply chain using the same tool. The tool let the company move from once-a-week planning to daily planning, improving their agility as a company. They saw 50 percent reduction in product waste and improvements in operational efficiency. The company rolled the tool out in Mexico, then Russia, then Argentina, which had fast-growing markets and were therefore both good case examples for the company and markets where increased efficiency could lead to greater sales and, ultimately, market share.
Filippo also ran through an example in the pharmaceutical industry and one that touched on the implementation of Lean within an enterprise.
Filippo talked about a scheduling requirement trend: While planners are looking for tools that better take into account manufacturing and supply chain reality, engineers want tools that generate more realistic plans. He suggested that using a tool like PPO lets both constituencies work off the same set of data.