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Increasing flexibility : transition towards anonymous stock : a simulation study on the flow of goods at Voortman Steel Machinery

Visser, R. (2017) Increasing flexibility : transition towards anonymous stock : a simulation study on the flow of goods at Voortman Steel Machinery.

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Abstract:Voortman Steel Machinery (VSM) is a manufacturing company specialized in CNC controlled machinery for steel fabrication. The machines are capable of processing big and robust pieces of metal, used in the construction industry. Materials called ‘buy parts’ are used to produce the machines. These buy parts are purchased per project with a lot-for-lot strategy. In the warehouse, the buy parts are stored directly in a pallet dedicated to the project. The buy parts are not free to use by de Production Department, but only for the project they are ordered for. The lot-for-lot replenishment strategy combined with the project based storage is not considered flexible enough to deal with the projected growth of the company. The objective of this research is to gain knowledge on the consequences of anonymous storage, and of inventory based replenishment, for the buy parts. The main research question is: What are the consequences for VSM, in particular for the Warehousing Department, if the procurement of buy parts will be based on inventory levels and the storage of buy parts will be anonymous, and how should this be implemented? With a literature study, performance measurement is set up. The flexibility is not directly measurable. The most important performance indicators used for the performance measurement are: ▪ Inventory cost. The value of the materials present in the warehouse. ▪ Productivity. The number of actions needed per order. ▪ Labor time. The time needed in the warehouse for the flow of goods of the buy parts. ▪ Warehouse utilization. The number of store/pick cycles per storage system. Based on literature, we suggest a new replenishment strategy and a new storage strategy. The demand per material, and the value of inventory per material, are the two criteria used for a Multiple Criteria Inventory Classification to form three groups of materials, A, B, and C. For group A materials, the suggested replenishment strategy is lot-for-lot. A fixed order period replenishment strategy is suggested for the materials in groups B and C. This is called the ‘ABC replenishment strategy’.
Item Type:Essay (Master)
Faculty:BMS: Behavioural, Management and Social Sciences
Subject:85 business administration, organizational science
Programme:Industrial Engineering and Management MSc (60029)
Link to this item:http://purl.utwente.nl/essays/74088
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