simulation modeling and analysis of productivity enhancement in

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SIMULATION MODELING AND ANALYSIS OF PRODUCTIVITY ENHANCEMENT IN MANUFACTURING COMPANY USING ARENA SOFTWARE SITI HARTINI BINTI EMBONG @ AB WAHAB Thesis submitted in fulfillment of the requirements for the award of the degree of Bachelor of Engineering in Manufacturing Faculty of Manufacturing Engineering UNIVERSITI MALAYSIA PAHANG JUNE 2013

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Page 1: simulation modeling and analysis of productivity enhancement in

SIMULATION MODELING AND ANALYSIS OF PRODUCTIVITY

ENHANCEMENT IN MANUFACTURING COMPANY USING ARENA

SOFTWARE

SITI HARTINI BINTI EMBONG @ AB WAHAB

Thesis submitted in fulfillment of the requirements

for the award of the degree of

Bachelor of Engineering in Manufacturing

Faculty of Manufacturing Engineering

UNIVERSITI MALAYSIA PAHANG

JUNE 2013

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ABSTRACT

Every manufacturing company wants to improve and adapt their operating system in

order to survive the industry competition. In manufacturing organizations, to improve

their system it might mean to reduce the operating costs that come from the wastes in

production line. By using the ARENA simulation in this study, the productivity

improvement can be experimented without physically affect the real system and reduced

the cost because designing, building, testing, redesigning, rebuilding and retesting can be

an expensive project. This study focus on the flow in the production line processes in

one piston manufacturing company. The existing plant layout was studied and

formulated into ARENA simulation software as well as to enhance the productivity rate

by improving certain parameters. The problems identified in this production line are the

effect of the bottleneck process which resulting some idle time in some workstations and

the increased piston demands from the customers. The data acquired and was translated

into the ARENA simulation software and studied in order to simulate the existing plant

layout design. Hence, the problems occurred in the production line can be seen clearly to

determine room for productivity improvement. New designs are proposed by

constructing several models to acquire the best solution to improve productivity capacity

and meet the forecasting demand of customer. In these proposed models, the parameters

of the actual system are modified accordingly in the terms of material handling such as

human resources, machine cycle time, the number of machines, shape and area of plant

layout. From the simulation results, the significant contribution factor that influenced the

rate of productivity was by adding certain machines to do the same process to cover the

buffer while the material handling did not have a huge effect on the production line.

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ABSTRAK

Setiap syarikat pembuatan ingin memperbaiki dan menyesuaikan sistem operasi mereka

untuk terus bersaing dalam industri yang mencabar ini. Bagi organisasi pembuatan,

untuk memperbaiki sistem mereka, ia bermakna, mereka mesti mengurangkan kos

operasi yang tidak bermanfaat. Tumpuan kajian ini adalah untuk mendalami aliran

dalam proses pengeluaran dalam syarikat pembuatan omboh. Susun atur kilang yang

sedia ada dikaji dan ditafsirkan ke dalam perisian simulasi ARENA untuk meningkatkan

kadar produktiviti dengan meningkatkan parameter tertentu. Antara masalah-masalah

yang dikenal pasti dalam pengeluaran ini adalah kesan akibat kesesakn proses tertentu

yang menyebabkan masa terbiar di beberapa stesen kerja dan juga permintaan omboh

sentiasa meningkat daripada pelanggan. Data yang diperolehi akan dikaji dan

diterjemahkan ke dalam perisian simulasi ARENA untuk simulasi reka bentuk susun

atur kilang yang sedia ada. Oleh itu, masalah-masalah yang berlaku dalam proses

pengeluaran dapat dilihat dengan jelas dan kawasan di mana peningkatan produktiviti

yang boleh dibuat dapat ditentukan. Reka bentuk baru dicadangkan dengan membina

beberapa model untuk memperoleh penyelesaian terbaik bagi meningkatkan keupayaan

produktiviti dan memenuhi ramalan permintaan daripada pelanggan. Bagi model

cadangan, parameter sistem sebenar diubahsuai dengan sewajarnya seperti pengendalian

bahan seperti sumber manusia, masa kitaran mesin, bilangan mesin, bentuk dan bidang

susun atur kilang. Daripada laporan simulasi, faktor yang paling mempengaruhi kadar

produktiviti penambahan mesin tertentu untuk melakukan proses yang sama bagi

menampung kesesakan dalam pemprosesan, manakala, faktor pengendalian bahan tidak

memberi kesan yang besar pada kadar pengeluaran produk.

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TABLE OF CONTENTS

Page

EXAMINER APPROVAL DOCUMENT ii

SUPERVISOR’S DECLARATION iii

STUDENT’S DECLARATION iv

DEDICATION v

ACKNOWLEDGEMENTS vi

ABSTRACT vii

ABSTRAK viii

TABLE OF CONTENTS ix

LIST OF TABLES xiii

LIST OF FIGURES xiv

LIST OF ABBREVIATIONS xv

CHAPTER 1 INTRODUCTION

1.1 Preface 1

1.2 Background of Study 1

1.3 Company Background 4

1.4 Project Background 5

1.5 Project Objectives 5

1.6 Project Scopes 6

1.7 Problem Statements 6

CHAPTER 2 LITERATURE REVIEW

2.1 Introduction 8

2.2 Productivity 8

2.3 Material Handling 9

2.4 Facility Layout 10

1 × ENTER (1.5 line spacing)

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2.5 Simulation 11

2.5.1 Simulation Process 11

2.5.2 Simulation Benefits 14

2.5.3 Disadvantages of Simulation 14

2.6 Application Areas 15

2.7 Simulation Tools 16

2.8 ARENA Simulation Software 17

CHAPTER 3 METHODOLOGY

3.1 Introduction 21

3.2 Project Methodology 21

CHAPTER 4 RESULTS, ANALYSIS AND DISCUSSION

4.1 Introduction 29

4.2 Data Collection 29

4.3 Simulation Model 37

4.3.1 Model 1 (Simulation of Actual Layout Design) 37

4.3.2 Model 2 (Experimental Design) 40

4.3.3 Model 3 (Experimental Design) 41

4.3.4 Model 4 (Experimental Design) 43

4.3.5 Model 5 (Experimental Design) 45

4.3.6 Model 6 (Experimental Design) 47

4.3.7 Model 7 (Experimental Design) 49

4.3.8 Model 8 (Experimental Design) 51

4.3.9 Model 9 (Experimental Design) 53

CHAPTER 5 CONCLUSION AND RECOMMENDATIONS 56

REFERENCES 59

APPENDICES

A1 Gantt Chart For FYP 1 62

A2 Gantt Chart For FYP 2 63

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B1 Production Plant Layout 64

B2 Plant Layout For Piston Machining Cells 65

B3 Capacity Study For Piston Model PN 17 66

B4 Capacity Study for Piston Model CE 17 67

B5 Example of Simulation Parameter (Process & Resource) 68

B6 Example of Simulation Parameter (Queue) 69

B7 Model 1 Animation (1 Hour Run) 70

B8 Model 1 Circuit (1 Hour Run) 71

B9 Model 1 Animation (1 Month Run) 72

B10 Model 1 Circuit (1 Month Run) 73

B11 Model 2 Animation (1 Hour Run) 74

B12 Model 2 Circuit (1 Hour Run) 75

B13 Model 2 Animation (1 Month Run) 76

B14 Model 2 Circuit (1 Month Run) 77

B15 Model 3 Animation (1 Hour Run) 78

B16 Model 3 Circuit (1 Hour Run) 79

B17 Model 3 Animation (1 Month Run) 80

B18 Model 3 Circuit (1 Month Run) 81

B19 Model 4 Animation (1 Hour Run) 82

B20 Model 4 Circuit (1 Hour Run) 83

B21 Model 4 Animation (1 Month Run) 84

B22 Model 4 Circuit (1 Month Run) 85

B23 Model 5 Animation (1 Hour Run) 86

B24 Model 5 Circuit (1 Hour Run) 87

B25 Model 5 Animation (1 Month Run) 88

B26 Model 5 Circuit (1 Month Run) 89

B27 Model 6 Animation (1 Hour Run) 90

B28 Model 6 Circuit (1 Hour Run) 91

B29 Model 6 Animation (1 Month Run) 92

B30 Model 6 Circuit (1 Month Run) 93

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B31 Model 7 Animation (1 Hour Run) 94

B32 Model 7 Circuit (1 Hour Run) 95

B33 Model 7 Animation (1 Month Run) 96

B34 Model 7 Circuit (1 Month Run) 97

B35 Model 8 Animation (1 Hour Run) 98

B36 Model 8 Circuit (1 Hour Run) 99

B37 Model 8 Animation (1 Month Run) 100

B38 Model 8 Circuit (1 Month Run) 101

B39 Model 9 Animation (1 Hour Run) 102

B40 Model 9 Animation (1 Month Run) 103

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LIST OF TABLES

Table No. Page

2.1 Simulation software that available on the market 17

4.1 Piston models for customer ‘NK’ 31

4.2 Comparison between Actual System and Model 1 39

4.3 Comparison between Actual System and Model 2 41

4.4 Comparison between Actual System and Model 3 43

4.5 Comparison between Actual System and Model 4 45

4.6 Comparison between Actual System and Model 5 47

4.7 Comparison between Actual System and Model 6 49

4.8 Comparison between Actual System and Model 7 51

4.9 Comparison between Actual System and Model 8 53

4.10 Comparison between Actual System and Model 9 55

5.1 The comparison of productivity capacity between the models

and actual system

57

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LIST OF FIGURES

Figure No. Page

2.1 The life cycle of a simulation study 13

2.2 Model application window in ARENA simulation software 18

2.3 Example of airport security application model 19

2.4 Example of airport security application model simulation run 19

3.1 Flowchart of project methodology 22

4.1 Features of the piston model 30

4.2 Critical features of the piston 30

4.3 Overall piston production flow 32

4.4 Piston machining process flow in Line 4-5 33

4.5 Machining cell Line 4-4 and 4-5 layout 35

4.6 The view of Model 1 in ARENA simulation 37

4.7 The view of Model 2 in ARENA simulation 40

4.8 The view of Model 3 in ARENA simulation 42

4.9 The view of Model 4 in ARENA simulation 44

4.10 The view of Model 5 in ARENA simulation 46

4.11 The view of Model 6 in ARENA simulation 48

4.12 The view of Model 7 in ARENA simulation 50

4.13 The view of Model 8 in ARENA simulation 52

4.14 The view of Model 9 in ARENA simulation 54

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LIST OF ABBREVIATIONS

BASIC Beginner’s All-purpose Symbolic Instruction Code

C++ C with Classes (programming language)

CAD Computer-aided Design

CAM Computer-aided Manufacturing

CNC Computer Numerical Control

DRB-HICOM Diversified Resources Berhad – The Heavy Industries Corporation of

Malaysia Berhad

FORTRAN The IBM Mathematical Formula Translating System

KPI Key Performance Indicator

OEM Original Equipment Manufacturer

Perodua PERusahaan Otomobil keDUA

Proton Edar PeRusahan OTOmobil Nasional

REM Replacement Equipment Manufacturer

VBA Visual Basic for Applications

WIP Work In Progress

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CHAPTER 1

INTRODUCTION

1.1 PREFACE

This chapter will discuss on the background and rationale of this study. It also

covers on research background which is significantly related to the project objectives,

project scopes, and problem statements.

1.2 BACKGROUND OF STUDY

Nowadays, the automotive industry in Malaysia is recognized as one of the

freshest and provides most steadily growing markets, where it provides the world needs

widely except for America and Continental Europe. Malaysia is stated as the third

South-East Asian auto maker where it produced more than half a million vehicles over a

year assisted by Japan and Korea. Proton Edar (PeRusahaan OTOmobil Nasional),

Perodua (PERusahaan Otomobil keDUA), and DRB-HICOM (Diversified Resources

Berhad – The Heavy Industries Corporation of Malaysia Berhad) are among the most

notable automotive giants in Malaysia industry.

Parallel with the growing and the establishment of the automotive industry, the

automotive component industry also rapidly evolved in order to support and provide the

industry with the automotive partial components. Because of that, the demand of

automotive parts increased tremendously as the most of automotive parts; from small to

large parts, and sophisticated parts have been localized for internal fabrication.

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Consequently, many automotive components suppliers or vendors from Malaysia and

foreign countries have placed a large sum of money to raise plants and support the

automotive manufacturers in Malaysia and entrusted the local vendors to supply the

automotive partial components to them.

As the demand increased in automotive components, the companies are forced to

determine the solution to increase their productivity in order to satisfy the customer

requests. Various existed and fully developed techniques, methodologies and

productivities strategies are available but yet still can be improvised to suit the current

situation in order to determine the ultimate productivity approaches. Of course, as

today's industries competitive, every company must create a quick but efficient decision

to improve and adapt their operating system in order to survive the global challenges and

be on top in their respective discipline. In manufacturing organizations, to improve their

system it might mean to reduce the operating costs that come from the wastes in

production line.

Waste is defined as any activity that does not add any value to the products or

services. The activity that does not add value to the products or services means that the

client is not willing to pay more money for this activity. Waste can be viewed as the

single obstacle that can define a business over time, unless they are identified and

systematically wiped out. Waste elimination is one of the most effective ways to

increase profitability in manufacturing. To eliminate waste, it is important to understand

exactly what waste is and where it exists. While products differ in each factory, the

typical wastes found in manufacturing environments are quite similar.

Generally, there are 7 forms of wastes identified in lean manufacturing;

overproduction, transportation, motion, waiting, processing, inventory and defects. This

paper focus on the two of the forms; motion (people or equipment moving or walking

more than is required to perform the processing) and waiting (waiting for the next

production step). These wastes can be triggered by various factors such as incorrect

plant layouts, lack of proximity of machines and waiting workers, machines and

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materials. Plant layout design and material handling methods will be the main focal

point of this study due to its large contribution in waste elimination.

The plant layout is a very critical role in running an efficient and cost effective

business. All work areas, production lines, material storage facilities, etc. should be

designed to perform to its highest rate and the corresponding to the shortest cycle time.

When designing a plant layout, it is necessary to take into account all the functions

within the production plant. The pattern must include not only the needs for the present

production levels but should also have provisions for future expansion. This is included

to avoid frequent and costly changes to the design as demand increases.

The efficient layout design is important for reducing the operations and

management costs. The basic objective of layout is to ensure a smooth flow of work,

material, and information through a system. Although, there are several indicators and

objectives to the facility layout problem, the most commonly used objective is the

reduction of material handling.

Material handling is defined as the art and science of moving, packing, and

storing of substances in any form. Material handling is a very vital component of the

design and the needs of a manufacturing facility. Efficient material handling is important

to manufacturing operations. Materials must be unloaded, moved through inspections

and it needs to be properly stored and transferred to and from workstation/centers with a

view towards minimizing the movement and avoiding harm to the merchandise.

These motions do not add value to the product but they do add value to the

production cost. The cost of this being implemented incorrectly could affect the

profitability of the business and also could endanger the employees. In some instances

special handling equipment may be necessary to ensure that the material is handled

properly.

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Nowadays, simulation studies are widely used for applications in engineering

industry as a tool to increase the capacity of manufacturing and the profit of a company

by avoiding the company making an error in building non-effective layouts and using

wrong approaches. By the simulation also, the company can reduce the time needed to

grow the plants and there is no try-and-error situation because through the simulation, all

the details can be seen and examined thoroughly.

As the proof, the simulation studies are widely used in manufacturing, material

handling, delivery, business operations, and transportation as they has not only assisted

in understanding the details of the processes, but the graphical modeling tools and

animated run like those in ARENA simulation software, also ease the involvement of the

management in the development and the decision making processes.

In this paper, a simulation study using ARENA simulation software was

conducted in order to overcome some of the problems at production line in a

manufacturing factory, particularly the plant layouts, the waiting time at the various

processes due to high cycle time at some stages and material handling.

1.3 COMPANY BACKGROUND

This research will focus on the productivity on one of the automotive component

vendors in Malaysia which produces and supplies car piston parts to the automotive

manufacturers in Malaysia, and also the customer in foreign countries such as Japan and

Europe. The piston is a one of the most important and critical components in car

production which are installed in the engine transmission system, and plays a significant

role as the key contribution to drive the car movement. Its efficiency can be judged by

the movement driven by the combustion in a locomotive.

This piston plant is located in Selangor and has been operated for about 30 years.

They specialize in various kinds of gravity aluminum casting and machining parts. The

plant also fabricates other automotive components such as piston pin, valve housing,

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pinion housing, mounting brackets, compressor bracket, etc. They produce pistons for

cars, trucks and motorcycles in which the plant runs the fabrication process from the

beginning stage includes melting, casting, heat-treatment, machining, washing, coating

and packaging.

1.4 PROJECT BACKGROUND

This project focuses on the study of the flow in the piston production line

processes in this automotive component vendor company. In this project, the first step to

take is to examine the existing plant layout and the details before applying that layout

design into the application of ARENA simulation software in order to simulate the plant

layout design.

This project is also aiming to develop a process flow simulation model of the

existing plant layout to identify problems occurred in the production line and determine

where the productivity improvement can be realized. The problems and wastes in the

processes are investigated and analyzed. The application of ARENA simulation software

enables the productivity problems occurred in the production floor being highlighted.

Several new plant layout designs are developed to encounter the problems

occurred in the original plant layout and simulated using ARENA simulation software.

From the analysis and the simulation results, a summary of comparison between the

design options is made to determine which option shows the best solution, and then, the

best approach is selected as the best option to be implemented in the chosen company.

1.5 PROJECT OBJECTIVES

1. To study the existing production layout using ARENA simulation software in the

automotive component vendor company that produces piston.

2. To improve the productivity by ameliorate the plant layout and material handling

in the company by simulation using ARENA simulation software.

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1.6 PROJECT SCOPES

This project focuses on the productivity improvement of piston production

processes in the automotive component company. To ensure the objectives are achieved,

some of important elements must be considered. These are:

a) Studying the production processes and present time study for the piston

production processes.

b) Study and applying ARENA simulation software in order to simulate the process

flow in the piston production line.

1.7 PROBLEM STATEMENTS

Nowadays, due to the continuous positive increment in the automotive market,

the automotive component vendors also taking the heat as they are required to increase

their productivity to meet the demands of the automotive manufacturers which are their

clients. The designs and the demands of the components keep changing from time to

time depends on the customer requirement and market situation. These conditions will

lead to the tighten time frame to the production.

In addition, many of automotive vendors racing with each other to improve their

production technology and enhance the production rate as the outcome from the increase

of production cost and competitiveness due to economic globalization. The outcome of

these situations is there are many researches and developments have been performed to

create and modified new equipment/machines, methods, and systems. One of the

methods developed is system modeling by using simulation software, where in this study

will be used ARENA simulation software.

The main problem that occurred in this piston manufacturing line is that they are

struggling to keep up with the demand for piston parts from customer ‘NK’. The

constraint is on the production volume to meet the requirement by the delivery date

fixed by this customer. In the year of 2012, an average of 2,500 sets of piston was

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required per month for all Original Equipment Manufacturer (OEM) models and 1,000

sets for Replacement Equipment Manufacturer (REM) and this was done hardly on time.

Currently, for the January 2013 order, with an increase on the figure of the new car

models introduced, the customer increased the order by added the order for OEM pistons

for model PN 17 to a total number of 7,000 sets, which leading them to increase in

overtime in order to conform to the demand on time. One set of piston has 4 pieces of

pistons; therefore they are required to produce 28,000 pieces of pistons. The forecast of

demand for customer ‘NK’ for the piston model PN 17 in May, June, and July 2013 are

expected to have increment from the current demand which are 15% (8,050 sets), 25%

(8,750 sets), and 27% (8,890 sets).

The piston machining processes also contributed to large total lead time in the

manufacturing processes. It was due to some processes having much longer machining

time than the other. So, the next process would have to wait until the part was done in

the previous stage before proceeding. This situation produced some idle time for

machines and operators at several workstations at the time.

Therefore, in this inquiry, it is important to improve the productivity

enhancement in this production plant up to the level that can fulfill all the customer

needs in not only in the short term but also in the long term. The design must be suitable

for the long term so the company would not cost much money to change the design

frequency. Hence, the simulation modeling analysis by using ARENA simulation

software has been chosen as a method of improvement to the production plant in term of

plant layout, machining processes, and material handling.

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CHAPTER 2

LITERATURE REVIEW

2.1 INTRODUCTION

This chapter will discuss in detail regarding the literature used in order to

conduct and completed this research. The primary reason for the literature reviews is to

identify the right concept and the definition which related to the research title. Each

definition and the concept must be entirely understandable, so when the research is done,

the problems can be discovered easily and the objectives of the research can be

achieved. The resources of this literature review obtained from several secondary

resources such as online journal, books, articles, and related sites.

2.2 PRODUCTIVITY

Productivity can be defined as the measurement of the production line efficiency

of the company. According Aini (2009), productivity is the ratio of outputs (goods and

services) divided by the input (resources, such as labor and capital). It is important to

improve the company‟s productivity, so that the company can remain competitive with

other competitors and be on top of their field.

In order to improve the productivity, the company must firstly improve the

efficiency of their production line. It was essential to minimize or it could, eliminate the

waste, so the goal of improvement can be seen prominently. An organizational survival

was affected by the level of productivity improvement increased through production loss

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reduction and labor efficiency and these efforts can be driven through a host of

productivity improvement initiatives (Longenecker and Standsfield, 2000).

Kaydos (1991) reported that in order to maximize and improve productivity

continuously, the system is required to align their resources to their maximum

capabilities and combined the work study such as scientific analysis, methods, and

logical flow of the process. It is important to generate the process that can meet the level

of productivity and quality required. From a manufacturing standpoint, productivity

improvement is most often translated as: faster cycle time, lower cost, maximized

machine utilization, and also maximized floor space utilization.

2.3 MATERIAL HANDLING

Material handling systems are recognized as one of the basic components in a

manufacturing organization. Material handling can be defined as the activities,

equipment, and procedures that involved in the movement, storage, control and

protection of materials and products throughout the manufacturing processes,

distribution, and disposal. The systems exist for supporting the overall manufacturing

process. It should be understood that part „movement‟ does not add value to the product,

and any unnecessary movement should be eliminated wherever it is possible (Askin and

Standridge, 1993). Material handling equipment encompassed a diverse range of tools,

vehicles, storage units, and appliances and can be categorized as four main categories

such as storage, engineered systems, industrial trucks and bulk material handling.

The storage equipment usually used to hold or buffer materials during downtimes

or when the materials are not being transported. It may refer to pallets, shelves or racks

onto which materials may stacked in an orderly manner while wait for transportation or

consumption. Whilst, the engineered systems are covering a variety of units that work

cohesively to enable storage and transportation and often automated. Good examples of

this system are conveyor and robotic delivery systems.

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In other hand, industrial trucks are referred as different kinds of transportation

items and vehicles used to move materials and products in material handling systems.

The common type falls under this category are hand trucks, pallet jacks, walkie stackers

and platform trucks. The final category is the bulk material handling equipment. It

referred to the storing, transportation and control of materials in loose bulk form. These

materials included food, fluid, or minerals. The common types of equipment under this

category are conveyor belts, stackers, and hoppers.

For the entire plant, the material handling system acts as the circulating system,

dispatching vital material in all the plant cells. The objective need not be to determine a

minimum cost material handling system, instead, the system that satisfies all the plant

requirements to be effective and efficient manufacturers (Meyers and Stephens, 2000).

2.4 FACILITY LAYOUT

Facilities layout is the arrangement of areas within a facility (Russell and Taylor,

2000). The arrangement is made physically consists of everything needed for the product

or service, including machines, personnel, raw materials, and finished goods. Therefore,

a facility layout design is responsible in minimizes the total cost of products and

compete against competition and increases the factory‟s productivity, business

performance, the effective utilization of manpower, space and infrastructure.

The designed facilities should be flexible to maximize the benefits in an

organization when there are future changes in product design, process design, schedule

design and facility expansion. An effective layout can utilize space and labor efficiently,

facilitate the entry, exit, and placement of material, products, and people, eliminate

bottlenecks, reduce manufacturing cycle time, minimize material handling costs, and

increase productivity, throughput or profitability (Gupta et al., 2004).

Manufacturing facility layouts can be divided into two categories: basic layouts

and hybrid layouts. The basic layouts consist of process, product, and fixed-position

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layouts and the hybrid layouts consist of cellular layouts, flexible manufacturing

systems, and mixed-model assembly lines. Patterns of flow may be viewed from the

perspective of flow within workstations, within the department, and between

departments. There are four general types of general flow pattern: Straight line, U-

shaped, S-shaped, and W-shaped.

2.5 SIMULATION

One of the gurus of simulation Shannon (1975) historically defined simulation as

“the process of designing a model of a real or imaginary system and conducting

experiments with this model for the purpose either of understanding the behavior of the

system or of evaluating various strategies (within the limits imposed by a criterion or set

of criteria) for the operation of the system.” This primitive definition highlights the

general framework of simulation principles and gives a clue of the roadmap that

simulation has gone through within the last century. Each and every word and phrase in

the definition should be further emphasized for exact comprehension of the term

simulation.

The first sentence of the definition mentions the types of systems that simulation

studies can be conducted on. The systems can be “real” or “imaginary”, which means

that there can create a physical facility or a process to be modeled, or the model can be a

modification of the existing system or it can be completely imaginary. The imaginary

systems refer to the ones that are planned as alternatives to existing systems and entirely

original systems.

2.5.1 Simulation Process

As Shannon (1975) stated, simulation is a continuous “process” rather than a

one-time create-and-use application. Especially computer simulation is an iterative

method that includes several stages as Kelton et al., (2004) identified. Firstly, the

simulation study is started by understanding the existing system and identifies the goals

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of the study. The next step is creating the formulation of the model representation

usually in terms of mathematical models or flowcharts before transferring into modeling

software.

Once a simulation is created, it is necessary to verify the simulation to ensure

right things is done. The following stage is to validate the simulation to familiar subject

that represented the system so that the simulation works in accordance with the

conceptual model faithfully, supporting the validation work with statistical tests can be

of critical importance at this stage. Experimentation with the developed model is done

by designing experiments to identify the critical performance measures to be used with

equal confidence and running these designed experiments by using the computers

effectively.

The last stages take account of analyzing the results, getting an insight of the

results to evaluate the outcomes of the results and to assess the potential benefits.

Finally, documentation is necessary for the inheritance of the work done for other

simulation staff and also to clearly transmit the findings and recommendations to related

management levels with precision and confidence.

The life cycle of a simulation study has also been identified in detail by Balci

(1990). This life cycle has been divided into 10 processes, 10 phases and 13 credibility

assessment stages. Figure 2.1 provides the details of those identifications and the

precedence and succession relations between them.

According to (Sadowski, 1999) a successful simulation project is the one that

delivers useful information at the appropriate time to sustain a meaningful conclusion,

which means that there are three key elements of success in the simulation; decision,

timing and information.

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Figure 2.1: The life cycle of a simulation study

Source: Balci (1990)

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2.5.2 Simulation Benefits

Simulation has many benefits for the users as outlined by Banks (2000).

Designing, building, testing, redesigning, rebuilding then retesting can be an expensive

project. Simulations take the building/rebuilding phase out of the loop by using the

model that already created in the design phase. Most of the time, the simulation testing is

cheaper and faster than performing the multiple tests of the design each time.

With simulation, the problems of complex systems can be diagnosed that are

nearly impossible to handle within the actual environment, identify constraints that act

as a bottleneck for operations, visualize the plan using the animation capabilities of the

software used that results in a more presentable design. Simulation is also beneficial to

build consensus among the members of the decision makers and to prepare for changes

by considering the potential “what if” scenarios.

The simulation can be extensively applied as an off-line decision making tool for

aiding the management with production planning issues such as efficient capacity

utilization, sequencing and scheduling and allocation of resources in manufacturing and

production.

2.5.3 Disadvantages of Simulation

Banks (2000) underlines four main disadvantages of simulation:

1) To use the simulation application it requires special training and it is

highly unlikely that models generated by different modelers about the

same system will be the same.

2) The simulation results are difficult to be understood because most

simulation outputs are essentially random variables based on random

inputs, it may be difficult to find out whether an observation is a result of

system interrelationships or randomness.