How to effectively optimize factory work - Case study

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How to effectively optimize factory work - Case study
Case Study

In the modern manufacturing sector, where the pace of change and growing customer demands are on a daily basis, efficiency and process optimization have become key factors determining success. One of the most significant challenges faced by manufacturing companies is the speed of order fulfillment. Often, customers placing orders expect them to be shipped the next day, without considering that the manufacturing company has a certain capacity.

In this article, we will take a closer look at an innovative production management system that has been implemented in several factories for a leading professional sportswear company. We will analyze the technological solutions used and how the system contributed to improving the company’s competitiveness, reducing order fulfillment time and optimizing the production process. In the later part of the article, you will learn about the solutions that were implemented and how they impacted the daily work of the factory.

Client’s objective and business needs

The existing system required improvements in terms of security and operational convenience. The main task was to introduce the necessary upgrades without disrupting the production process. The factory’s efficiency and effective management were of particular concern. They play a prominent role in ensuring operational success and achieving high production standards.

Maintaining continuous and maximum workload in the daily operation of the factory poses a significant challenge to its efficiency. Any production downtime can lead to time and cost losses. Sustaining continuous workload is crucial to ensure that the factories operate smoothly and produce the maximum number of units within a given timeframe. Another important aspect is task prioritization, which proves to be an essential element of effective performance management. It allows for goal setting, identifying key actions, and resource allocation in a way that yields optimal results. Through prioritization, the factory can focus on critical areas, avoiding distractions and ensuring efficient use of time and resources.

How the points allocation and deployment system works

To improve factory efficiency, a functionality for points allocation and deployment has been implemented during the production process. Managers responsible for the proper and efficient operation of the factory determine the weekly capacity of the factory in points. Each placed order represents a product that needs to be made and carries its own “cost” in points. For example, if we have an order with a production cost of 20 points and the factory’s weekly throughput capacity is 1000 points, it means that the factory can produce 50 such orders in that week.

The allocated points serve as a perfect measure for monitoring the pace of factory work and forecasting the amount of work that can be accomplished within one week. By having a predetermined number of points assigned to a specific factory for a given week, overload is avoided, and there is no accumulation of more orders than the factory can produce. Customers receive reliable information about the actual order fulfillment timeline.

The points that the factory can deploy are allocated separately for each week in the order management system. This allows management personnel to quickly respond to various factors that determine production, such as seasonality, changing market demand, or material availability.

Showing the process from the factory to the consumer
Organizational chart

When the factory has a defined number of points, it can allocate them to its distributors and sub-distributors, who can further share points with their dealers. Each product sold by the dealers has a specific point value assigned to it. By adding products to an order, the points also accumulate, allowing the dealer to know how many points they will utilize in the current order and how many points will remain for future orders.

The system is designed in such a way that if a dealer runs out of points, they can utilize the points from the distributor or even from the factory if any are unused. The factory can also maintain a reserve pool of points that are not allocated among its distributors. This allows for flexibility in responding to additional, often unplanned but prioritized orders.

Developing such functionality required a thorough understanding of the customer’s requirements and analyzing various scenarios that could impact the system’s operation. In this case, it was necessary to handle not only the allocation and usage of points by dealers, transferring points between weeks but also the ability to cancel orders and perform multi-level point refunds.

Technical considerations

  • System Architecture:

The system was initially developed using WebForms technology with Visual Basic and is gradually being migrated to newer technologies. Currently, the system utilizes the .NET 4.6.1 framework with C# for the RESTful API. The API follows a database-first approach and employs Entity Framework for database connectivity. The system components are interconnected, enabling querying the API and displaying the retrieved data.

  • Points Allocation Algorithms and Logic:

Points allocation operates based on a hierarchical assignment approach, starting from factories and cascading down to distributors and dealers. The goal is to distribute the available points optimally among the system participants while considering any constraints and conflicts.

Points are allocated from top to bottom for a specific week in a given factory. If the points have not yet been assigned (and are not reserved) at the factory level, they enter the pool of that particular level.

For example, if a factory has 2000 points for a given week, reserves 200 points, and assigns 100 points to a specific distributor, the remaining 1700 points will be available in the free pool. The system always tries to retrieve points during order placement from the lowest available level. The order of retrieving points, having access to all the pools, is as follows: dealer points, sub-distributor pool, distributor pool, factory pool, reserved factory points.

The system enables various operations, such as:

  • Setting points at all levels.
  • Using points to place an order.
  • Canceling an order (returning points to the selected pool).
  • Transferring an order to another week, as well as migrating points (returning points to the source week’s pool and charging the destination week’s pool).

Code snippet - example to visualize
Code snippet - points allocation functionality

  • Testing and Monitoring

Unit tests have been added for the functionalities related to points, ensuring system stability and correctness. These tests encompass scenarios such as enabling and disabling pools, adding/reserving points, and retrieving points.

Result improving factory performance

The functionality introduced into the factory system has contributed to:

  • Improved production efficiency: With this functionality, the factory can better plan and manage the production process, leading to increased production efficiency.
  • Avoidance of production delays: Points allocation allows for better workload forecasting, enabling the factory to fulfill orders on time and avoid delivery delays for customers.
  • Even distribution of workload: Allocating and utilizing points enables the even distribution of workload across different weeks, distributors, and dealers. This allows for better utilization of human resources, machinery, and materials, resulting in increased efficiency and reduced losses.
  • Flexible response to changing market conditions: The introduced functionality allows the factory to adjust priorities and allocate points based on current needs, focusing on producing products that are in high demand by customers during specific periods.

The implementation of points allocation and utilization functionality has improved the factory’s operations by enhancing management, optimizing processes, avoiding overloads, reducing delays, and flexibly responding to changing market conditions. As a result, the factory can maintain competitiveness, increase efficiency, and deliver high-quality products on time. Such functionalities enable the factory to address the negative impacts of oversupply, including delivery delays, inadequate production materials, and customer frustration.

About The Author
Izabela Węgrecka

Izabela is a Project Manager and Scrum Master with 6 years of experience in the IT industry. She has experience in leading diverse projects and effectively managing teams. She's a leader with the ability to create cohesive and efficient teams based on Scrum values. Regardless of the project's scale, she's able to establish a dynamic environment where collaboration, innovation, and delivering valuable products take precedence.