Evaluation and Optimization of Inventory Policies and Production Layouts in Production Systems

Abstract

The company that this project takes place at has most of its production
facility in Halmstad. A little more than a year ago this plant was exposed
to a fire that destroyed the facility completely. The company is now
planning to build a new plant on the same spot as the old was situated.
Purpose The purpose of this project is to analyse the company´s material flow
and based on the result make decisions concerning what handling
equipment to use, the sizes of the buildings.
Problem The problem to be solved in this project is to find a layout for inventories
and production appropriate for the company investigated. That includes
for example dimensioning the inventories to keep the targeted service
level, where also seasonality in demand is taken into account. Another
problem to be solved is how the different parts of the plant should be
situated related to each other in order to optimize the flows within the
plant, going deeper into some buildings in the facility. Also what type
and how many handling equipment to use in order to get an effective
flow through the plant is an issue in this project.
Methodology To decide how large the inventories need to be, how demand predictions
are made and the method used for updating the forecasts is made
differently depending on if the demand showed signs of seasonality or
not. In case the demand has a seasonal demand pattern Winter’s trendseasonal
method is used, otherwise exponential smoothing is used. An
inventory policy is used to determine how large the different inventories
need to be in order to keep the service level; in this case the (R, Q)The company that this project takes place at has most of its production
facility in Halmstad. A little more than a year ago this plant was exposed
to a fire that destroyed the facility completely. The company is now
planning to build a new plant on the same spot as the old was situated.
Purpose The purpose of this project is to analyse the company´s material flow
and based on the result make decisions concerning what handling
equipment to use, the sizes of the buildings.
Problem The problem to be solved in this project is to find a layout for inventories
and production appropriate for the company investigated. That includes
for example dimensioning the inventories to keep the targeted service
level, where also seasonality in demand is taken into account. Another
problem to be solved is how the different parts of the plant should be
situated related to each other in order to optimize the flows within the
plant, going deeper into some buildings in the facility. Also what type
and how many handling equipment to use in order to get an effective
flow through the plant is an issue in this project.
Methodology To decide how large the inventories need to be, how demand predictions
are made and the method used for updating the forecasts is made
differently depending on if the demand showed signs of seasonality or
not. In case the demand has a seasonal demand pattern Winter’s trendseasonal
method is used, otherwise exponential smoothing is used. An
inventory policy is used to determine how large the different inventories
need to be in order to keep the service level; in this case the (R, Q)
The company that this project takes place at has most of its production
facility in Halmstad. A little more than a year ago this plant was exposed
to a fire that destroyed the facility completely. The company is now
planning to build a new plant on the same spot as the old was situated.
Purpose The purpose of this project is to analyse the company´s material flow
and based on the result make decisions concerning what handling
equipment to use, the sizes of the buildings.
Problem The problem to be solved in this project is to find a layout for inventories
and production appropriate for the company investigated. That includes
for example dimensioning the inventories to keep the targeted service
level, where also seasonality in demand is taken into account. Another
problem to be solved is how the different parts of the plant should be
situated related to each other in order to optimize the flows within the
plant, going deeper into some buildings in the facility. Also what type
and how many handling equipment to use in order to get an effective
flow through the plant is an issue in this project.
Methodology To decide how large the inventories need to be, how demand predictions
are made and the method used for updating the forecasts is made
differently depending on if the demand showed signs of seasonality or
not. In case the demand has a seasonal demand pattern Winter’s trendseasonal
method is used, otherwise exponential smoothing is used. An
inventory policy is used to determine how large the different inventories
need to be in order to keep the service level; in this case the (R, Q)

• author: Järlid, Emilie and Karlsson, Jenny
• supervisor: Fredrik Olsson
• organization: Production Management
• course: MIO920
• year: 2014
• type: M1 - University Diploma
• subject: Technology and Engineering
• keywords: Facility Layout Planning, Forecasting, Simulation of Production Processes, Production layout algorithms, Inventory Policy, Production layouts, Production systems.
• other publication id: 14/5481
• language: English
• id: 4286452
• date added to LUP: 2014-02-06 14:01:20
• date last changed: 2014-02-06 14:01:20