Spain’s geography is quite unique in Europe: Madrid, its centrally-located capital city, stands surrounded by a host of regional capitals spread along the Mediterranean and Atlantic coasts, including Barcelona, Valencia, Seville, and Bilbo. And that’s probably why planes would easily have replaced trains if not for two major rail rejuvenation projects in the Eighties: the AVE, super-fast trains that run up to 220mph while linking major cities with Madrid, and hotel-trains, Spain’s “hotels on wheels” that serve routes with lesser traffic. Both are highly convenient, offer a superior experience, and boast one of the best on-board (fresh) food service in Europe.
Renfe is the modern, extensive and efficient railway system that makes train travel in Spain delightful. Renfe Operadora (RENFE) is Spain’s state-owned major railway operator; they offer every level of rail service, from local destinations to high-speed InterCity links
The Spanish State railways are under development with major transformations and modernisation in process on their 15,000 km of railway. The AVE, the Spanish High Speed rail line, has made long distances shrink over the years. The high-speed (300km/h) rail line for Spain’s AVE service between Madrid and Seville became fully operational in 1991. The second high-speed rail line that Renfe operates from Madrid to Barcelona was completed in 2007. With the AVE and Renfe, you can easily visit the major cities such as Madrid, Seville, Malaga, Barcelona and the latest destination, Valencia which is just 1 hour and 38 minutes from Madrid.
Renfe is also constantly updating the Media Distancia network and travelling times between major cities are being reduced all the time.
RENFE also operate the moderate-speed Alaris line between Madrid and Valencia. The Media Distancia network is also constantly being updated and travelling times between major cities are coming down all the time.
Moreover, RENFE operate commuter trains known as Cercanias in eleven metropolitan areas, including Madrid and Barcelona.
According to one report from KPMG in 2012, the logistics cost occupies around 18% in the whole GDP, which is much more than many developed countries.
Why it happens? I think there are some reasons as following:
The tax problem. The tax rates between the service industry and logistics industry are different. The verification of the sum of the invoice of the companies is based on quantity of the vehicles and other fixed assets which is unfavorable to the logistics enterprises.
The fuel costs rise frequently that increases the cost pressure of the short-distance transport business city distribution business.
The pontage and toll fee charge the transportation business a lot.
The cost of human power is getting higher and higher.
The management of the company it self also brings the problem of the increased costs.
The whole logistic industry is in a low standard. That means lots of the private company even some personal vehicle contract for the transportation without any management.
The industry structure in China is different from it in developed countries. Now the industry structure is still ordered as the industry, service, and agriculture while in developed countries the order is service, industry and agriculture. So the countries with the first industry of service get the less costs logistics costs than China with the first industry of industry.
In summary, the Chinese logistics industry is still on the way to develop more. We need more and more professional logistics personnel to improve this situation, to make the logistics industry more perfect.
With the technology development, the needs of the electronics products increase more and more. As we all know, the electronic products are always updated and replaced by the next generation so fast. So the life of one product is shorter compared with other products normally. I always changed my cell phone around 2 years, and the laptop also can be used around 5years not because of the poor quality, but due to the new requirements of the some software or operation system appearing, the old one can hardly meet the need any more.
Consequently, lots of the rubbish including the broken computers, printers, communication equipment, household electrical appliances or the electronic instrument is left. This kind of rubbish is called E-waste, will be very harmful to the human health, while it also contains lots of the elements like metal, plastic which could be recycled for use. Then the reverse logistics of the E-waste appeared in order to solve the E waste pollution. Many companies start to establish the reverse logistics system not only for protecting the environment but also they can get considerable benefits from it.
The normal E-waste logistics structure should be as following:
Recycling: this is the basic function of the reverse logistics; the cost of recycling is a big part of the whole logistics system. Collecting the E-waste from the different places, with less amount increase the difficulty of transportation.
Detect and dismantle: this step is the key to determine if the waste could be reused and through which way can be reused. During the process, the rubbish can be recognized more early to save the transportation cost.
Reprocessing: the waste which can be reused will be reprocessed. The way including reusing, reproducing and recycling. Reusing means the waste can be used again only by being cleaned or being repaired a little directly. Reproducing means keeping the main structure and function of the waste, by replacing and detecting some parts to produce a new one. Recycling means only collecting the useful metal, crystal or plastics from the waste by dismantling the waste.
Resale: selling the recycled products including sale, transportation and warehousing. This process is similar to the normal logistics system.
Nowadays, many western countries have formulated strict regulations regarding with the recycling E-waste while in China we still do not have the related regulations although we already become a big electronic product consumed country. I think the reverse logistics system of the E-waste should not only be paid attention by the government, but also it should be implemented from the enterprises themselves. The government could introduce some policies to protect or compensate to encourage those companies. And the people also should become more aware of the E-waste recycling. Consequently, our society could be made better and better in the future.
I am so lazy to go out for shopping sometimes. And thanks for the online shopping, almost every time I need something, I will buy it by the online shopping. You can find so many different online shopping website in China. It saves you the time and more money. Even when I am in Spain, I am still interested in shopping something through this way. But do you ever think about it, how could the online shopping service survive without the logistics support behind?
Surely by the electronic commerce industry, the logistics industry develops more rapidly. Especially in China, more and more people are interested in shopping through the internet. Thus, there appeared lots of the courier companies. According to the statistics in 2013 from China Federation of Logistics & Purchasing, the companies have more than half business of this courier service which also bring them amount of benefits.
So I think in the future the Chinese courier industry will have the four trends: more popularized, more professional, more facilitation and more internationalized.
Firstly, compared with the physical shop, there are two basic advantages of online shopping which are cheapness and products variety. Now, we have around 600millions internet users, and among them there are 400 millions users have the experiences of online shopping while there are more than 140 millions of them do online shopping at least one time per month. The age of users are presented younger and younger. The young users are very fond of hearing the courier knocking the door and delivering the thing which they have bought. As the time goes on, with no doubt, online shopping will be an entire –citizen commercial behaviors in China. Therefore, the courier industry will also boom stably.
Secondly, although the most obvious character of the courier service is “ FAST “, with the development of the service in all the industries, the courier consists more meanings. Customers not only require the packages arrive in time, but also the different delivery way, the safety of the packages, etc. All of these needs will require this industry become more professional.
Thirdly, there should be more convenience. As the one of the service industry, courier service should provide more and more new service to meet the basic needs as well as some extra, not only the online shopping business, but also entering the daily life more. For example, now there appeared one new service is delivering the dirty clothes of the students who live in the campus to their home for washing and deliver them back.
Last, the internationalization makes the world smaller, and the same time creates more opportunities for the courier service. Some courier companies of China is already expanding there market abroad. To adapt different environment, culture, to meet different needs is the way to keep the company developing sustainably.
Here is a very interesting video about the research of E-Commerce in China.
The professor arranged a tour to the big Spanish company Poecelanosa. It was a really very meaningful trip which gave us a lot of lessons about many aspects such like the production quality management, logistics management, security management, green production management, innovation management and market management.
Porcelanosa is a Spanish ceramics and tiling company that specializes in bathroom furniture and accessories and tiling. It has many branches in the United Kingdom, Spain, France, Italy, Mexico, the United States and across the world. It was founded in 1973 in Villarreal, staffed by 98 employees. The company specializes in the production of porous, stoneware and porcelain wall and floor tiles in various finishes.
First of all, as the leading ceramics products company in the Spanish manufacture industry, they do a very well production quality management, the whole process from the choosing the raw material to manufacturing the semifinal or the final products, they use a strict production process way and advanced machine to promoting the efficiency and more accurate. Besides, although most of the processes are implanted by the automatic machine, but a appropriate number of workers are arranged by the side of the machine in case some thing wrong or errors happen occasionally to assure more quality of the products.
Secondly, when the bus got close to the company, the thing first came into your view was the huge logistics center logo and the building itself. They have one of the biggest logistics centers in Spain which includes one of the largest automatic warehouses in the world with a total storage capacity of 275,000 automatic pallets, the new construction will pair on 10 automatic bilateral stacker cranes with 20 shelving units, each 525 feet long. The 35,000 square foot warehouse extension was constructed 105 feet high and 913 feet long, roughly the size of a 10-story building, and has a storage capacity for 65,300 pallets. And as we have seen that during the whole storage process, there are few workers working with the forklift for moving some pallets of the product for distribution. The logistics system is highly automated.
Thirdly, a good manufacture enterprise always has a good security management, Porcelanosa does, too. All the workers also are dressed the uniforms and the safety shoes to protect the body. Additionally, in their huge factory, the floor is always kept clean although special ceramics production produces the dust or other dirt very often. Some automatic machine work without the operators, cleaning the workshop area more than 12 hours everyday which protect the whole environment inside the factory, preventing the workers from the respiratory diseases. You cannot imagine that it is so hard to find the dust even in some places it should exist that impressed us a lot. The thing more interested is that when the workers are asked about their health problem with working here, they told us that some of them got the respiratory diseases in the past years when the factory didn’t pay more attention about the security issue when it established in the beginning, but now fewer and fewer workers are sick because of the environment problem. Many workers have already worked here more than 20 years.
Fourthly, the green production management is also well implemented. Due to the special products they manufacture, it should have caused some population. But you can see that in such a non-dust environment with a huge workshop inside the factory, the workers ride the bicycles to reach anywhere they want to go. Each bicycle is put in order in the parking places with the names of the workers. And although there a lot of the machine which produce a high heat for the production reason, we can hardly see the air conditioners interior the factory. It does not mean the company doesn’t provide a better working condition for the workers, instead, the top of the factory there are many windows in order which helps the ventilation. So you will ever feel so hot inside the factory.
Regarding with the innovation management, they have an interior exposition which is called the products library storing thousands of the various products. Not only for researching the products catalog, but also searching some products information, it really helps a lot. Besides, those products samples also make the development of the innovation by the existed former products.
Last but not least is the marketing management. The company cannot survive with only manufacturing the products. It is the marketing which produce the profits for the company. Except the factory, Porcelanosa also has one big exposition hall in the first floor of the office building. There are different styles of the kitchens or bathroom according the different zones on the earth. You will find the Asian style, Russian style, north European style, American style, etc. Customers can have a visit in the hall, consulting any products which they are interested. This makes the products more visually to present in front of the customers. Besides, in order to expand the influence of their products in the range of the whole world, they invite many socialites to publicize them, from the famous film stars in Hollywood, to the Prince Charles of the United Kingdoms.
Porcelanosa is a successful enterprise from all of the view which we have seen through the visit. But of course they still have to improve to challenge the future fierce competitive market.
We need different types of goods in our daily life. We may buy some of these items in bulk and store them in our house. Similarly, businessmen also need a variety of goods for their use. Some of them may not be available all the time. But they need those items throughout the year without any break. Therefore, the warehouse plays a more and more important role. Due to the development of technology, the warehouse becomes more and more modernized for meeting more requirements for the company.
I was so lucky to have the chance to visit the logistics center of Consum Cooperativa which is a Spanish supermarket chain founded and headquartered in Valencia, Spain. The Silla warehouse is the largest in Valencia, with 38,000m2, housing dry foods, fragrances, medicines, and various items. These items are divided mainly according to their frequency of need. The warehouse consists of four sections: two conventional sections, one for food and the other for non-food, one low-rotation area, and one high-rotation area. Among them, in the high-rotation, most of the equipment is so automated that there is few workers working there only for monitoring if there is some errors or not. I noticed that the since the goods arrive this area, it is put on the conveyor which consist several self-inspection area for checking if the pallet itself and if the goods is packed well or not, if not, the goods will be sent to some special area to be repacked. The goods will be delivered to a huge storing rack. The whole process is totally automatically completed by the related equipment.
The warehouse seems to be the most important part in the retail industry, but a manufacture enterprise also takes the warehouse as a key part of their whole business chain.
Last week, we had an interesting and meaningful visit to Porcelanosa. It is a Spanish ceramics and tiling company that specializes in bathroom furniture and accessories and tiling. As the leader in their industry, they have one of the biggest logistics centers in Spain which includes one of the largest automatic warehouses in the world with a total storage capacity of 275,000 automatic pallets, the new construction will pair on 10 automatic bilateral stacker cranes with 20 shelving units, each 525 feet long. The 35,000 square foot warehouse extension was constructed 105 feet high and 913 feet long, roughly the size of a 10-story building, and has a storage capacity for 65,300 pallets. And as we have seen that during the whole storage process, the products are transferred by the conveyor automatically to the storage place, and there are only few workers working with the forklift for moving some pallets of the product for distribution. Everything is put in order. The warehouse are huge and very clean, the logistics system is highly automated.
From the two cases, we can see the big enterprises pay more and more attention to build a highly modernized automated warehouse. A modernized, automated, with more area warehouse will be the final trend when the company wants to develop and expand.
I chose to write about pallet pooling because it was my one slide topic a few weeks ago, but because of time issues in class I was not able to explain it. What I found most interesting in pallet pooling was that it seems to be of utmost efficiency in saving time, money and resources.
Pallet pooling is the use of the same pallets in a “network of customers in various markets, for the storage and transportation of their products” (Demes Logistics, 2004). The cycle begins with manufactures or their customers leasing pallets from a third-party pallet leasing company; products are then placed on these pallets and are transferred throughout the supply chain of a product. By pallet pooling, the manual handling of products is minimal. In some cases pallets are even used as part of in-store product storage and display.
There are various advantages to pallet pooling starting out with eliminating the cost of purchasing pallets and storage space for pallets in warehouses. There are many other benefits that manufactures and customers have reported such as less damage to products and loss of pallets. Transportation costs are also reduced and there is better tracking of pallets and products. Perhaps one of the most important aspects of pallet pooling is that pallets are of better quality due to the fact that the leasing company takes care of inspecting, maintaining, and repairing them on a regular basis before they re-enter the system.
I would like to write a post related with Diego’s last post “Where the trucks cannot (still) arrive”, I’ve just read it and it has seemed to me quite interesting. Furthermore, I’ve remembered a TV programme that I used to watch some years ago in Xplora channel. It was called “IRT Deadliest Roads”.
In my opinion, it was a very interesting programme in which you could see the truck drivers going by quite dangerous roads to deliver different kind of products. Even sometimes, at home, you could feel scared because they lived life or death situations.
In this programme, three experts truck drivers, Alex Debogorski, Rick Yemm, and Lisa Kelly, competed in order to know who was the best of them and who faced these extreme situations better.
It’s very curious to see how difficult can be this part of logistics because, although this programme was just that, I’m sure about somewhere truck drivers have to drive on these types of roads.
Finally I want to share with you two videos where you can have a look at this exciting programme. I’m sure you would like to live this experience at least once in your life, but as Diego said in his post, you need a lot of money.
Today the process automation has become part of many large companies, but some still have manual processes required to acquire the qualities of the products. The complexity, the need for constant monitoring, the thoroughness of some tasks fit and high quality feel and sound, is beyond the scope of available technology. The machines, do play a vital role and streamline many processes. Some tasks, such as intensive precision and repetition, are best left to machines, anyway they can´t replace the ability, skills, sensitivity and expertise of a craftsmen at many stages during the production. Additionally, to meet the specific and individual requirements of some clients, individual attention is required in many processes. (Guitar2go, n.d)
I could explain the entire process, which is really interesting, though; below you will find a video for you to see it yourselves. The interesting thing about this post is that in the video you can identify some of the techniques we’ve seen in class. For example, in 3:49 and 4:40 minute we can identify “ANDON system control”, with traffic lights that alert color process status.
Throughout the video, we can see how the order and cleanliness prevail. In 8:11 minute we can see all tools have their defined position. We can identify this with Tool “5’s”: It aims to make workplaces work better organized, tidier and cleaner permanently for greater productivity and improved working environment. Delete, Sort, Clean, Standardize and Respect.
In the video you will see some other tools taught in class. Take a look and find out if you can identify some. Enjoy !!
Pick-by-light and Pick-by-voice are two common technologies in warehousing operations which are used to do the order picking. These two systems already replaced the pick-by-paper approach, so order picking became paperless. This means higher accuracy, productivity and efficiency. But a new technology is approximating. Working with mobile augmented reality systems, head-mounted display cameras can improve the picking process even further.
Warehousing operations “are estimated to account for about 20 % of all logistics costs, and the task of picking accounts for 55 % to 65 % of the total cost of warehousing operations. This indicates that AR (Augmented Reality) has the potential to significantly reduce cost by improving the picking process.” (See DHL.com).
The Pick-by-Vision system has extensive benefits compared to light or voice-directed solutions. As it can recognize the surroundings and show the operator visual information via See-Through-Display, it guides the operator through the warehouse reducing travel time by optimized route planning. Real-time object recognition and barcode reading with just one view make the handling of additional scanners dispensable. The software is integrated in the Warehouse-Management-System so booking of withdrawals is automated which enables real-time stock updates.
Advantages of the Pick-by-Vision technology:
Training time required for operators minimized.
Language independent navigation within the warehouse.
Optical picking instructions replace paper, visual (lights) or voice-based directions.
Fully automatic tracking of serial numbers.
100% error-free picking improves quality control.
Applicable in every warehouse without structural changes or other modifications.
Lean techniques are intended to reduce time to deliver products to the customer, decrease costs, reduce waste while ensuring that the value and customer experience is not compromised. Restaurants are challenged to deliver hot and fresh food to customers, reduce wastes, manage costs by controlling the purchase of raw material, etc. For example, Subway implements lean techniques to produce the perfect sandwich for customers based on their requirements. They do this by ensuring that all the bread is kept ready to go in a baking case, vegetables are cut beforehand, the dressings are kept together towards the end of the line near the cashier, thus ensuring sandwiches are made in a fast, efficient manner. The value proposition Subway offers to customers is fast and fresh sandwiches based on customers needs, thus perfecting lean in the fast food chain.
The challenges for Starbucks with handling lean are different from that of a fast food chain. Lean processes are known to make process robotic in nature. However, getting coffee at Starbucks is an experience that needs to be handled with care. Starbucks employees are encouraged to engage in conversations with customers while taking their order, while at the same time ensuring that customers don’t have to wait in lines for very long. The idea was to increase the number of drinks each Starbucks employees can make in an efficient manner, thus reducing the number of store employees leading to cost savings for the company. Approximately 24% of the annual revenue for the company is in store labor and there was room for improvement to lower that number. Scott Hayden, the VP of lean thinking said “Motion and work are two different things. Thirty percent of the partners’ time is motion; the walking, reaching, bending”. The following techniques were employed at a Starbucks location resulting in the reducing the time to make coffee from more than a minute to 16 seconds.
1. Moving items closer reduced the movements behind the counter
2. Altering the order of assembly of the coffee also helped.
3. Commonly used syrups were stacked away in an easily reachable location
4. Whipped cream, chocolate, caramel drizzle where moved closer to the delivery area since it was the last step before serving up the coffee
Starbucks apparently offers over 80,000 different combinations of drinks. I would think it is impossible to remember every unique combination for the Starbucks employee while making multiple drinks at the same time. Starbucks, however, has a universal code to keep track of the drink specifications. The coffee cups are designed in such a way that allows the cashier to understand and communicate every minute detail of your drink to the Starbucks employee preparing your coffee.
Acronyms help Starbucks employees prepare the right drink and even announce the kind of drink while serving it up to the customer. This helps in making the customer feel special because Starbucks has not only managed to concoct your favorite drink, but is also able to repeat your highly customized order. This is a significant process improvement as opposed to writing down orders in a paper and having to check back regularly to ensure it is the right combination being asked for.
The other day I spoke with a friend that last October had the incredible opportunity of making a trip to the base camp of the Everest. I was quite shocked about it as it seemed to be something quite profesional. However he explained to me that nowadays is something reachable (if you have a lot of money of course) to do it and that is completely crowded of people. There are kind of hotels (lounges) all around the track and a lot of services. He started showing me pictures and after a while I asked him about the logistics…how is possible to transport all that stuff up there?Is there any road?
As far as he told me the last reachable point by transport is Lukla (2.800m). From there til the base camp of the Everest (5.834m) there is just two options: the Yaks, which is the animal used to transport the items and the backs of the sherpa´s beginers. This task is seen even as an honour as it is part of the formation process of the sherpa. It´s quite impressive seeing the pictures how a person can carry such a big weight, Actually is one of the things that shocked my friend more from the trip.
It is something not directly related with our class topics but I wanted to share it with you as it was really interesting for me. Thanks to this kind of thing we realize that although it seems that everything is completely automatized and transport with machines there are a lot of places where the trucks can´t arrive…at least at this moment!
Today I’d like to write about supply chain in general because it’s a considerable topic for me. For being successful on the market it is not enough just to look at the company itself and consider only the inhouse activities but to look at the whole supply chain.
„Supply chain logistics […] is the flow of material, information, and money between corporations (interworkstation, interfacility, intercorporate, and intrachain) [connecting the supplier’s supplier to the customer’s customer].”
(Edward Frazelle: Supply Chain Strategy, p. 8)
Depending on the kind of activity the supply chain can be quite long. There can be multiple suppliers, suppliers´suppliers as well as multiple customers and customers´customers. Supply chain describes the network of the different facilities, vehicles and logistics information systems. The flow of the supply chain is optimized when material, information and money are exchanged coinstantaneous, in real time and via electronic systems, without any paper necessary.
(Compare: Edward Frazelle: Supply Chain Strategy, p.10)
The logistics organizations along the supply chain have to collaborate. Supply chain management is necessary. Supply chain management stands for “[t]he management of upstream and downstream relationships with suppliers and customers to deliver superior customer value at less cost to the supply chain as a whole.” (Martin Christopher: Logistics and Supply Chain Management, p.5)
Effective logistics and well-oiled supply chain management can be an eminent competitive advantage. A competitive advantage should be reached by distinguishing the company from the competition. The company should be something special, unique for the customer. Moreover good quality at acceptable prices should be offered. The enterprise should concentrate on efficient processes and continue on improving them. The possible cost savings are immense. (Compare: Martin Christopher: Logistics and Supply Chain Management, p.13f)
More and more enterprises count on lean processes and lean manufacturing. “[Lean] is a production practice that considers the expenditure of resources for any goal other than the creation of value for the end customer to be wasteful, and thus a target for elimination. Working from the perspective of the customer who consumes a product or service, “value” is defined as any action or process that a customer would be willing to pay for.” (Wikipedia: Lean manufacturing, http://en.wikipedia.org/wiki/Lean_manufacturing)
Lean manufacturing distinguishes by producing efficiently and effectively. There are some figures for measuring lean manufacturing. In the following I’ll concentrate on three numbers.
The first figure is the First-Time-Through capability FTT. This measures the percentage of the good units that go through the production process without being scrapped, reworked, rested, returned by the downstream operation, or diverted into an off-line repair area. FTT is the leading indicator of quality. The percentage of defects is calculated for each process. The target value of FTT is 100%, so there would be no poor units at all.
FTT=( Ninput- (Nscrapped+Nreworked+Nretested+Nrepaired) ) / Ninput * 100
Overall Equipment Efficiency OEE is used to determine the productivity at the equipment level function of a number of mutually exclusive components like availability, efficiency, performance and quality efficiency in order to quantify various types of productivity looses. Productivity looses are for example breakdowns, set-ups or adjustments. The OEE helps to identify the efficiency, to see to what extent specific equipment is used for the production of a concrete product type or group. The OEE should be high as possible.
OEE = (Tpt /Tst) * (Tc* Nfu)/ Tpt* (Nfu– Nd)/Nfu* 100
The Dock-to-Dock Time DTD is the time for turning raw materials into finished products. Improving the DTD time improves the company’s ability to deliver on-time and lowers the cost for warehousing as well as for material handling.
DTD= Tmi+ Tmct+ Tfi
Sixt is a Worldwide car rental company headquartered in Pullach, Germany. It has around 4,000 service stations in over 105 countries. Sixt was founded in 1912 by Martin Sixt in Munich, and continues to expand internationally. Sixt is the 5th biggest car rental company in the World and is the largest BMW car rental company in the world.
The company is owned 57% by the Sixt family and it is named after the founder’s last name Martin Sixt.The remainder of the shares is traded stock. Several family members manage the company: Erich Sixt (CEO), Regine Sixt (Marketing), Alexander Sixt (Corporate Development), Konstantin Sixt (Online). So it is very effective in case of controlling the whole company.
Sixt provides rent and leasining of fleet for their clients. To assure highest quality in every phase of the leasing process, Sixt has implemented international harmonized and customer oriented workflows. Defined service standards and service level agreements enable cross country mobility solutions that client can rely on.
Sixt Leasing has designed its logistics and related services in such a way so as to make them as flexible and cost-effective as possible. You can opt for delivery at the dealer, at your company site or directly to your home. An important advantage is the station network of Sixt rent a car, as you can always find a station close to you. The logistic intelligence of Sixt Leasing offers advantages, especially for large service fleets and complex requirements such as labeling of vehicles or special fittings. Sixt´s solutions are always geared to individual requirements. They not only book your vehicle at reasonable prices, monitor the delivery time and register your vehicle, but also keep your staff mobile right from the start with a temporary car from the Sixt fleet.
Wal-Mart: The world’s largest company. If Wal-Mart were a country, it would have the 27th largest GDP in the world. A total of over 11,000 stores worldwide, each of which measures, on average, the size of about 8 of the largest versions of Consum. The distribution centers to supply such large stores can measure up to about 3 million square feet (or about 280,000 square meters). It then should be no surprise that Wal-Mart has undisputed recognition for being the most logistically sophisticated company in the world.
Wal-Mart has state-of-the-art warehousing systems, nearing full-automation, miniscule amounts of inventory, leading cross-docking practices (in which product is taken directly to the shipping dock, instead of receiving, to avoid stocking expense, in cases where orders for that item are received), route optimization, and many other practices that many companies are already struggling to replicate.
However, Wal-Mart continues pushing harder to decrease waste, and optimize value. One instance is through the Electronic On-Board Recorder units, which not only tracks routes and positioning, but is being adapted to monitor driver’s foot movement, gear selection, and other driving decisions, with plans to retrain drivers with more efficient driving practices. Wal-Mart’s load-optimization software is some of the most sophisticated, optimizing truck-space. But the company goes beyond organizing boxes, to managing their content’s “value density.” Studies and research is conducted to reduce packaging, and even alter the design and chemistry of products, such as detergent formulas that reduce the water content, to make the product more value-dense.
The inventory system not only tracks stocking units perfectly, sending requests not just to the warehouse, but to the supplier as well, giving the entire supply chain real-time information on the products that need to be restocked. However, this software is beginning to retrieve this information before the product has even been bought, using shopping apps which consumers use to organize their shopping lists, and which links up to the supply chain’s demand information.
A book could be written about Wal-Mart’s logistics. The supermarket giant is going beyond standard practices, and has even set even less realistic goals of being supplied by 100% renewable energy, creating 0 waste, and sell products that sustain the environment. Perhaps 10 years ago, Wal-Mart was doing was many retailers are now only beginning to do. Hopefully in the near future, these seemingly insurmountable goals will be shared world-wide.
Everybody knows the problem: You order something online, but you know already that you won´t be at home, when the parcel will be delivered. So missing a delivery is on the one side annoying for the customer, on the other side additional costs for the parcel service. The Irish enterprise Parcelhome claims to have a solution to this problem.
Parcelhome developed a parcelbox, which easily can be installed at the house of the end-customer. With this box, parcels can be received and sent from a private house without being at home. The plan is that end-customers hire the boxes for 5 to 10 Euros per month. Greg Mackin, the head of the company says the boxes will be big enough to fit 90-95% of all Amazon or Ebay-parcels.
The system requirements are consumer-friendly: Deliverer and receiver just need a smartphone and an application of Parcelhome. When delivering a parcel, the deliverer´s smartphone identifies the receiver´s parcelbox…
I decided write about my one slide subject because i think it is very interesting and there are a lot of cases of implementation.
In 1990, most of the companies did not know the meaning of 5 S , but in this 2001, 5s is part of the vocabulary of any TQM scholar, manager, consultant or practitioner.
The reason for this 5S growing practice in Mexico has different causes:
1) Japanese consultants in Mexico promoting this technique.
2)Mexican professionals that graduated from a Japanese university( Masters, degree or PhD) consultants and executives been trained by Japanese agencies (JUSE, JIPM, AOTS, JICa, LATEC) promoting with clients, at universities or inside their companies.
3) Incorporation of the 5S as a main phase and sstrategy in the TQM implementation model for competiveness.
4) Successful application of the technique with quantitive benefits being obtained by the companies and institutions.
As any organization or country, the succes depends mainly on the commitment and leadership of top and middle management.
Many of the implementation failures are caused by:
1) 5S program is implemente as a motivational and attitude change movement using only posters and slogans ( no plan support structure)
2)No investment in the 5S program
3) People do not understand the objective, target, strategies ti deploy and personale role in the program (from top management to line workers)
4) Top and middle management believe it is a program for the workers and do not participate or support it.
5) The 5S program starts at the operation line level as a bottom-up strategy without the support of top management.
6)The 5S program strats as a ¨Top down¨ strategy with a small group of experts doing the whole job without integrating all the personnel of the organization.
Is a work philosophy that aims to support the implementation of a Continuous Improvement program in business, with the involvement and active participation of all staff; in all levels of the organization.
Kaizen is a daily process, the purpose of which goes beyond simple productivity improvement. It is also a process that, when done correctly, humanizes the workplace, eliminates overly hard work, and teaches people how to perform experiments on their work using the scientific method and how to learn to spot and eliminate waste in business processes. In all, the process suggests a humanized approach to workers and to increasing productivity: “The idea is to nurture the company’s human resources as much as it is to praise and encourage participation in kaizen activities.”
Planning and preparation
a. Select a process or activity to improve
b. Define the problem
c. setting boundaries and collecting data before the event
d. Create a work team
e. Prepare the target area
f. Schedule the event.
Implementation (Kaizen event)
a. Training the participants (1st day) Lean tools, methodology
Kaizen, data review and management of standard operations.
b. Mapping and Analysis Process (2nd day), data analysis and indicators, identify waste and creating proposals for improvements.
c. Walking the gemba-situ process (3rd day), begin pilots.
d. Check the pilot results (4th day), adjust process, document standard practices and release the solution to production.
e. Present results (5th day), review results with the leaders and celebrate the improvement.
Communication and follow up
a. Post the Kaizen event to the company.
b. Review and monitor the results.
c. Get feedback on the experience from the operators involved in the Kaizen event.
d. Document the results and lessons learned
e. Develop the next event involving new resources.
Here is a short video with a simple explanation about a Kaizen Event.
The Lean Six Sigma is a Business Improvement Strategy that integrate two approaches: Six Sigma and Lean Manufacturing. this results in a improved capability of performance and in addition, to the elimination of the eight kinds of wastes , classified as Defects, Overproduction, Waiting, Non-Utilized Talent, Transportation, Inventory, Motion and Extra-Processing.
In separate ways, the main emphasis of Lean is on cutting out unnecessary and wasteful steps in the creation of a product so that only steps that directly add value to the product are taken. So, this mean speed, the processes are going to be faster and more efficient.
The Six Sigma isolation eliminate defects and waste, thereby improving quality and efficiency, by streamlining and improving all business processes.
The training for Lean Six Sigma is provided through the belt based training system, This belt personnel are designated as color belts, similar to karate wich are yellow, green, black and red. For each of these belt levels skill sets are available that describe which of the overall Lean Six Sigma tools are expected to be part at a certain Belt level. These skill sets provide a detailed description of the learning elements that a participant will have acquired after completing a training program. The level upon which these learning elements may be applied is also described. The skill sets reflects elements from Six Sigma, Lean and other process improvement methods like TOC (Theory of constraints) and TPM (Total Productive Maintenance).
The union of this approaches to help companies streamline operations, increase value and reduce wasteis very powerful, bisides, there are number of benefits that businesses can achieve by using these tools, like the customer satisfaction, because the Lean Six Sigma focuses not only on product improvements, but also improvements to product delivery methods and other customer service activities that can impact in this customer satisfaction.
It reducets costs too, associated with improvements to processes to require less time and emloyee resources at the same time, so there is going to be employee growth, cause the unnecessary extra-work is not needed. Even, includes employee involvement, through their participation on process improvement teams designed to help them improve processes and increase value for their customers, internal and external.
Other benefits about Lean Six Sigma is that Revenue increase, by appying this kind of Business Improvement Strategy, so after processes were improved, the revenue increase and even th efficiency.
So I think this is a good way to improve the processes of any company, because it helps to increase the cooperation of all components of the company, having a good comunication between all of them, it helps to optimize time and resources and to the general development of the company.
Hi guys! As my show slide this week is related with the Value Stream Mapping, I have found interesting to explain in what is based this method. A known automotive firm as Toyota started using the method long time ago and it has turned as good way to improve the stream of goods and information to the final customer in some industries.
All value produced by an organization is the end result of a complex process, a series of actions that lean thinkers call a value stream. It is surprising how hard it seems to be for managers to focus on the value stream for each product for each customer to improve it for the benefit both of the customer and the value-creating organization.
Toyota has known how to do this for many years, using what are usually called information and flow diagrams. Some specialists in the late 90s realized that these techniques were largely unknown outside of Toyota.
This is what now we know as Value Stream Mapping. A value stream is all the actions (both value added and non value added) currently required to bring a product through the main flows essential to every product: 1. The production flow from raw material into the arms of customers and 2. the design flow from the concept to launch.
Value Stream mapping is then, a pencil and paper tool that helps you to see and understand the flow of material and information as a product makes its way through value stream. What is meant by value stream mapping is simple: follow a product’s production path from customer to supplier and carefully draws a visual representation of every process in the material and information flow. Then the firm must ask a set of key questions and draw the future state map of how value should flow.
We can appreciate in the pictures that there are some icons. They have general meanings that are used for the companies to be understood the flow and the process.
I would like to explain more about VSM but I think that with this little articles all you can get the main idea of the method, if you want to know more, just let me know!
I would like to write a post regarding my OSS for this week, JIDOKA. It’s a very interesting concept related with lean manufacturing, its founder is Sakichi Toyoda and it’s not only used by Toyota, nowadays, it’s used by many other big industries because it entails a lot of advantages.
The origin of Jidoka:
In 1896, Sakichi Toyoda invented Japan’s first self-powered loom called the “Toyoda Power Loom”. Subsequently, he incorporated lots of revolutionary inventions into his looms, including the weft-breakage automatic stopping device (which automatically stopped the loom when a thread breakage was detected), the warp supply device and the automatic shuttle changer. Then, in 1924, Sakichi invented the Type-G Toyoda Automatic Loom, the world’s first automatic loom with a non-stop shuttle-change motion. This loom automatically stopped when it detected a problem such as thread breakage.
The meaning of JIDOKA is “automation” or “autonomation” which implies “self-working” and “self-moving”, and JIDOKA can be defined as automation with a human touch. This concept is based in 4 main principles:
Detect the abnormality or problem
Stop the operation
Fix or correct the immediate condition
Investigate the root cause and install a countermeasure
As I said above, JIDOKA has some important advantages such as higher quality and machine up-time, reduction in labor, lower repair costs, improvement of the customer satisfaction and increase of the productivity. The purpose of this concept is to free equipment from the necessity of constant human attention, separate people from machines and allow workers to staff multiple operations.
JIDOKA allows authorizing the machine operator to stop the flow line so that defective pieces will not move to the next station. This term is very related with Just-In-Time (JIT), another lean manufacturing concept, because in JIT systems, it’s absolutely vital to produce with zero defects. As we can see in the following picture, they are the main two pillars (principles) of the Toyota Production System along with Just-In-Time.
Finally, I want to share a video with you in which you will see clearly the Toyota Production System (TPS):
Hello Guys, I have always been curious about the Amazon way of doing business so I thought this might be interesting sharing. Lets start from the name Amazon,why that name? Apparently, Bezos the owner and founder of Amazon, wanted a name for his company that began with “A” so that it would appear early in alphabetic order. He began looking through the dictionary and settled on “Amazon” because it was a place that was “exotic and different” just as he planned for his store to be, and he believed it was the biggest river in the world, and he planned to make his store the biggest in the world
Amazon claims to be customer centric meaning, they start from the customer and then work backwards , in other words they spend much money on things or items customers really like and lastly they are innovative in their Supply networks where they constantly bring in new technology to assist their supply chain network. This diagram clearly shows what happens, behind the scenes, each time you click the button on your computer at home
I always say, behind every success there´s a story, it seems that the customer centric nature partially depends on some many other companies, not only the largeness and corporate image counts. Companies like , Zappos , buy.vip, lexcycle and many others.
The replenishment strategy of Amazon reflects mostly with understanding preference than have more variety of goods and than lower cost. Counting on different wholesale suppliers makes it possible to create the exotic Amazon for the users
I hope this video from the abc News really helps you to understand what is cooking behind the scenes
My post is related with the theme of my slide for this week´s class. I was really looking forwards to hearing and reading something related with lean production as I don´t know much about it and I found it really interesting. Moreover, nowadays almost every big company puts in practice its principles.
The word Kaizen(改善) means “good Change” in Japanese. However it is usually used to talk about a variety of techniques or methods which are implemented to improve manufacturing operations. It appeared around the 1950´s and developed in the TPS (Toyota Production System).
Kaizen is the theoretical philosophy and the Kaizen Events are the way of making this real. The main issue of a Kaizen Event is the time. The difference between Kaizen and other events is timing. Kaizen by definition is small changes for the better. Today, Kaizen events are known to have the results implemented before the conclusion of the event. It is considered so as a rapidly improvement or accelerated improvement workshop. The aim of the Kaizen Event is not to generate a great change in the company, but to make an improvement. The addition of these improvements will then generate big advantages for the organization. A Kaizen Event can be developed both individually or in groups.
We can define some basic rules for a Kaizen Event:
No rank between team members
Keep an open-mind to change
Respect each other.
Plans are only good if they can be implemented.
There is no substitute for hard work
Just do it!
The process can be developed following these steps:
Define the problem and document the current situation.
Visualize the ideal situation
Brainstorm solutions.
Develop the plan and implement it.
Measure and compare results.
The following video shows you a practical example of a Kaizen Event.
Fonts:
– Syverson, N. (2001). Kaizen: Continuing to improve. Industrial Maintenance & Plant Operation, 62(2), 16-18.
– Glover, W. J., Farris, J. A., & Van Aken, E. M. (2014). Kaizen Events: Assessing the Existing Literature and Convergence of Practices. Engineering Management Journal, 26(1).
January 1, 2002, the twelve EU countries, with their more than 300 million constituents, participated in the largest currency experiment of such a kind in history. The various local currencies, including the German Marks, French Francs, etc., were to be replaced overnight with the Euro currency. The swap made for one of the largest logistical problems Europe has ever faced together.
The swap began at least three years earlier as a book value currency, allowing for exchange stabilization. The new currency had to also be coined and printed, which required standardized printers that could match the exact specifications of the new bills down to the nanometer. Next was the distribution of the bills and coinage. This began three months earlier in the beginning of September, as the more than 2,300 armored vehicles, trucks and security personnel were deployed to spread the currency throughout banks, to be held in their vaults; Many of which had to be redesigned to house the new currency.
As deployment was finished, the transition would start as the money was distributed in “starter kits,” or small amounts purchasable at local banks. The period between the beginning of January, until February 28th was to be a transition period, in which both currencies could be legally used as consumers got used to the Euro. Bank restrictions on labor hours were relaxed to help with the transition.
Besides spreading the new currency, the old currencies also had to be collected. Predictions were made that half this old currency would be collected within the first two weeks. Citizens were called to empty their piggy banks, exchanging the currency for the Euro.
The switch to the Euro is a remarkable feat in logistics, done with relatively few problems.
My one slide for next week is about Heijunka. I will like to show you the importance about this basic pillar of the lean manufacturing philosophy. Some would say that the Lean Manufacturing Philosophy can be defined as The Toyota House, or the TPS House (See the image below, I did it because there were many examples on the web, please correct me if any mistake), however, it doesn’t matter how you called it, the thing is that “A house divided cannot stand”, that means that every part of the house has a role and a specific propose. In this post I will try to explain the Heijunka block as a part of the house. (Abilla, 2012)
Heijunka is a Japanese technique that in english means «Leveling» or «Production smoothing». In the application of Heijunka, production doesn´t vary according to customer demand, but relies on it to adjust the volumes and sequences of the products to be manufactured, furthermore, the production department should be sure that the components are sequenced to be available in the right quantity and at the right time (McManus, 2013). If a company implement property the Heijunca, it will helps to avoid batching, reduce wastes and finished goods inventories, reduce capital cost and production lead time, and of course eliminates unevenness in workload (MURA) and intensive work (MURI) that can lead to security problems and quality.
I have found some tools and calculations that are useful for the implementation of Heijunca in a right way:
Tack Time = Production time available / total number required
2. Calculate pitch of each product: (high volume = 12 and 30 min)
Number of pieces per unit time, based on tack time required to perform operations units.
Tack time Pitch X = Number of units in the package.
3. Establish the production rate:
Taking the lowest value of the pitch and distribute in even increments according to the product to be manufactured, and the actual total daily production time.
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The blog of Logistics at MGEPS at UPV 