Electronics Process Part Simulation to find best case scenario for process upgrade. Helped to reduce number of parts lost from downtime.
Appendix AFinancial Calculations
SM Electronics: Cost Savings through Simulation AnalysisTeam CJGTeam Members: *Gabriel Silva, Chris Weinkauf, Johnathon Wright
Executive SummaryThis report provides an analysis and evaluation of SM Electronics fourth production line. Arena simulation models were built to mimic the real world production line to allow data and conclusions to be drawn from. Using simulation data and results to test their recommended production changes allowed the representation of calculable (all calculations can be found in appendices) results without the large investment of money. Results of testing the recommendations in simulation showed that currently SM Electronics is losing an average of close to $2,680.00 per week in lost production. Implementation of their first proposed recommendation proved to show no improvement to the financial weekly amount lost in production. However, results showed that implementing their second proposed modification would reduce their weekly lost production cost down to approximately $1,900.00. It is recommended that SM Electronics implement proposed modification two, as it satisfies the cost justification needed for a two year ROI. Problem Description and Research QuestionCurrently SM Electronics is having too high of production loss and wants to simulate their production lines to financially calculate their production losses as well as use the simulation to decide if a their proposed recommendations can reduce their losses. Their current production line chosen to be analyzed has the following work flow:
Proposed Modification 1: addition of pallets to the existing fourth system. $17K + $3K for each new pallet. Benefit: More parts to work in the fourth line.
Proposed Modification 2: insert additional space for incoming parts by adding three new buffer conveyers. Specifically three buffer conveyers would be added at the incoming merge point. Then parts would be released in batches to save machine setup time on each process. $56K, total cost to implement modification 2.
SM Electronics asked that the report give results based off of a few specific questions:1. What is the cost of lost production for our current system?2. What is the cost savings, if any, resulting from the implementation of the first proposed modification? How many additional pallets should be added?3. What is the cost savings, if any, resulting from the implementation of the second proposed modification? Include a detailed description of your proposed release logic.4. Should we implement both of the proposed modifications?Per SM Electronics request, all cost comparisons will be presented in dollars per week to allow for easy assessment. The main deliverable SM Electronics would like is to determine which option from above will produce the largest return on investment if implemented.
1. Negligible transfer time from input conveyor to line 4.2. Cell 8 will first take a new part even if cell 7 is ready to transfer to it.3. Limitation on the maximum number pallets is 48.4. Two year ROI to consider an alternative, with fifty work weeks per year.
ProcedureIn order to properly construct a valid simulation, four different models will be needed for comparison. The four models were:
1. Current Process (no modifications)2. Extra Pallets3. Buffer Lines for Parts A, B, and C4. Buffer Lines and Extra Pallets
Model 1 is the model used to answer question one from our problem statement. We will be able to calculate the lost production cost of their current system. Model 2 allows the user to increment extra pallets into production, starting with 40 and up to 48, which will allow us to answer question two. Model 3 implements buffer lines for parts A,B, and C to allow the model to send parts out in batches to properly answer question 3. Lastly, combining buffer lines and extra pallets will provide data necessary to answer question 4. In our simulation models we created module types that could be used in each model to help keep the models similar. Those module types included:
Part Entry into the Holding Conveyor Automatic Cells (Automated Process, contains decision tree in logic) Manual Cells (Manual Process, no setup time required) Cell 8 Completed Part Exit Lost Production Part Exit
These modules remain constant throughout the models, the only part that changes is the way parts enter into the holding conveyer. This will be different in model 3 and 4 due to the introduction of buffer lines. (Logic for each model can be found in Appendix A).Once simulation models were completed and output data was gathered, it was necessary to calculate the return on investment of each proposed improvement to choose whether or not the proposal should be implemented.
Experimental Summary Results
Question 1/Model 1 ResultsQuestion 2/Model 2 Results
Question 3/Model 3 ResultsQuestion4/Model4 Results
2 Year ROI for Buffer LineRough Estimate $2678-$1907 = $771 * 100 weeks = $77,100. Which is greater than initial investment of $56,000.ConclusionAfter analyzing the four models the second proposal option proved to be the right choice. With a two year ROI of +$20,000 it proved to be a worthy investment. We ran a means comparison in order to maximize the weekly profit of the production line and found that the second choice was correct, with an average weekly savings of over $700 a week (See appendix A for means calculations). Although the line is far from perfect (still $1,900/week in production lost) it is an improvement. Analysis also showed that batching parts were the key to the savings, which leads to the recommendation of further batching experimentation. Reducing setup and changeover time (whether it is automated or not) will be the key to further reducing the weekly losses. Pursuing the possibility of a larger manufacturing vicinity would also be a recommendation worth investigating.
Snapshot of Arena Animation *Robotic Arms = Automatic Cells*Drill Press = Manual Cells
Appendix AFinancial Calculations
Final ProjectIEE 545Team CJG
Appendix APsuedo Model Logic
M1- Model of Current System
M3- Buffer Lines Model
Lost Production ExitAuto Cell Model
Manual CellCell 8
Appendix BDifference of Means Calculations (Profit Maximization)M1M2
Question 1Replication #Part A LostPart B LostPart C LostPart A GoodPart B GoodPart C GoodLost Production per Week19511611113174817801243$2,675.6429551627111973917691255$2,680.6439491614113775017761238$2,680.07410091576109969518131272$2,682.1759821586111971418081255$2,678.8469981572110570018261264$2,674.1879691579114372818141230$2,680.14810011543113370318441240$2,678.7499811573112571318221249$2,674.08109911596109970818021268$2,678.75Cost of ACost of BCost of C$0.89$0.63$0.72
Question 2 (41)Replication #Part A LostPart B LostPart C LostPart A GoodPart B GoodPart C GoodLost Production per Week19751605112172517801257$2,686.0229581632110774017571269$2,677.8239641620112173417711253$2,685.6849481605114675317851225$2,679.99510111553110468618371272$2,673.0669621569117073318181211$2,687.05710031569111169418281258$2,681.0689681606112872817841248$2,685.4699891567113771618171236$2,686.06109431634112776117481250$2,680.13Replication #UtilizationPallets in Use10.964397257739.540287564620.971139.815430.967939.685140.97139.809950.970539.790960.969339.741370.971739.839880.973839.924490.972139.8544100.97287528139.8878865224Cost of ACost of BCost of C$0.89$0.63$0.72
Question 2 (42)Replication #Part A LostPart B LostPart C LostPart A GoodPart B GoodPart C GoodLost Production per Week19471636113374817571241$2,689.2729871567113171618211240$2,679.9639791562114872618221226$2,681.9349731596113172917871246$2,685.7759681607112173517821249$2,681.05610331569107266918131305$2,679.6879591603113274017871241$2,678.44810001600108369717931289$2,677.7699721635109772917541275$2,684.971010111556111568918341257$2,682.87Replication #UtilizationPallets in Use10.961540.382220.969740.727530.971240.792440.969740.725450.968240.66560.964340.498970.965640.555680.970640.764990.968240.6646100.95940.277Cost of ACost of BCost of C$0.89$0.63$0.72
Question 2 (43)Replication #Part A LostPart B LostPart C LostPart A GoodPart B GoodPart C GoodLost Production per Week19801630128572017641285$2,824.30210001555112670218351243$2,680.37310021549112769418431246$2,679.0949881551113871218371236$2,675.8159631627112373717581253$2,690.6469671599112573317911246$2,678.00710051561111369218311259$2,679.2489951566111170118281260$2,672.05910121542112068918451252$2,678.54109931602109970917881270$2,684.31Replication #UtilizationPallets in Use10.958641.219420.962441.383230.967441.59840.966741.570150.966641.561760.966241.547870.967741.611380.964141.457190.971541.775100.965141.4989Cost of ACost of BCost of C$0.89$0.63$0.72
Question 2 (44)Replication #Part A LostPart B LostPart C LostPart A GoodPart B GoodPart C GoodLost Production per Week19981620108270117671291$2,687.86210011572110669718171267$2,677.5739691525117772818681193$2,670.60410031522114569618611233$2,675.9359651611112072917851250$2,680.1869831578112471218121251$2,678.2979621606112573717851245$2,677.9689801592111971917911259$2,680.8499751550115571918331228$2,675.85109711569114172618291224$2,674.18Replication #UtilizationPallets in Use10.955842.055220.960442.259230.961642.309440.961442.302750.961242.294560.968942.63170.962942.369480.964342.430290.961842.3197100.959242.2036Cost of ACost of BCost of C$0.89$0.63$0.72
Question 2 (45)Replication #Part A LostPart B LostPart C LostPart A GoodPart B GoodPart C GoodLost Production per Week110001573110869918171262$2,678.7529641572115473218161220$2,679.2039621617112573417751246$2,684.8949581668109174417171281$2,688.98510071563110969218221266$2,679.4069541615113274317721243$2,681.5579761598111372517881259$2,676.7489811589111571718001257$2,676.9699721570114572918191224$2,678.58109751599112372817841250$2,683.68Replication #UtilizationPallets in Use10.953142.890820.961443.260930.962343.304140.962143.296450.964743.411760.963843.371970.954842.965780.960343.213990.958743.1432100.959343.1679Cost of ACost of BCost of C$0.89$0.63$0.72
Question 2 (46)Replication #Part A LostPart B LostPart C LostPart A GoodPart B GoodPart C GoodLost Production per Week19801572113171318181244$2,676.8829721623111072717621264$2,686.7739701585113373118041235$2,677.6149681581114973218001228$2,684.8359991594110270117961266$2,686.7769801629109072217591278$2,683.27710121524112968518681240$2,673.68810051556111769218361252$2,678.9799701578113073318071240$2,671.04109771569113672718161234$2,675.92Replication #UtilizationPallets in Use10.950543.723520.960944.203130.96444.345740.960644.186450.954743.916660.960644.188570.962244.259980.957844.05790.962544.2741100.95243.7933Cost of ACost of BCost of C$0.89$0.63$0.72
Question 2 (47)Replication #Part A LostPart B LostPart C LostPart A GoodPart B GoodPart C GoodLost Production per Week19451580116375418121204$2,673.8129481624113575017571242$2,684.0439861624108371117631290$2,680.42410061611106968617801305$2,679.9559951607109670117831275$2,687.08610041560111369718291254$2,677.72710001570111069618191262$2,678.3089461601114575417871224$2,674.9799551639110474517501264$2,677.40109611594114773217941229$2,685.35Replication #UtilizationPallets in Use10.94844.554420.960345.134330.951544.720640.958545.048550.959945.116760.960445.139470.95144.695580.95544.884390.953844.8276100.950644.6777Cost of ACost of BCost of C$0.89$0.63$0.72
Question 2 (48)Replication #Part A LostPart B LostPart C LostPart A GoodPart B GoodPart C GoodLost Production per Week19851606111071817771260$2,687.63210081557111769418321248$2,682.2739501637110974717511262$2,675.2949871610109271217801275$2,678.9759841601111171317891258$2,684.3169421591116775617961204$2,680.9579731565115471918251220$2,682.80810001554111269918331258$2,669.6699901595110470817951264$2,680.83109701562115572518321212$2,678.96Replication #UtilizationPallets in Use10.945445.379120.953945.788130.957345.95240.941645.195350.959346.04660.953545.76670.954645.821280.953845.782190.953445.7641100.956645.9164Cost of ACost of BCost of C$0.89$0.63$0.72
Question 3Replication #Part A LostPart B LostPart C LostPart A GoodPart B GoodPart C GoodLost Production per Week11601849834152015451532$1,907.7521611845835152015491530$1,906.8431611845835152015491530$1,906.8441601849833152015451533$1,907.0351611846835152015491530$1,907.4761601849833152015451533$1,907.0371601849833152015451533$1,907.0381611845835152015491530$1,906.8491601849834152015451533$1,907.75101611845835152015491530$1,906.84Replication #UtilizationPallets in Use10.986639.464320.986339.452230.983339.530340.980939.236550.9939.60260.985339.41270.987639.49380.987239.486790.987639.5028100.98939.562Cost of ACost of BCost of C$0.89$0.63$0.72
Question 4 (41)Replication #Part A LostPart B LostPart C LostPart A GoodPart B GoodPart C GoodLost Production per Week11601849834152015451531$1,907.7521611845835152015481530$1,906.8431611845835152015481530$1,906.8441601849833152015451532$1,907.0351611846835152015481530$1,907.4761601849833152015451532$1,907.0371601849833152015451532$1,907.0381611845835152015481530$1,906.8491601849834152015451532$1,907.75101611845835152015481530$1,906.84Replication #UtilizationPallets in Use10.98640.425420.985740.414930.987740.497740.980140.184650.989640.572460.984740.371170.986940.461580.986540.44890.986940.4649100.988540.5296Cost of ACost of BCost of C$0.89$0.63$0.72
Question 4 (42)Replication #Part A LostPart B LostPart C LostPart A GoodPart B GoodPart C GoodLost Production per Week11601849834152015451531$1,907.7521611845835152015471530$1,906.8431601849833152015451532$1,907.0341601849833152015451532$1,907.0351601849833152015451531$1,907.0361601849834152015451531$1,907.7571601849833152015451531$1,907.0381601849833152015451531$1,907.0391611845835152015471530$1,906.84101611845835152015471530$1,906.84Replication #UtilizationPallets in Use10.985441.38520.98941.538930.986941.451240.988841.527650.987741.483160.984441.345170.980941.197180.981841.235590.987341.4657100.990641.6068Cost of ACost of BCost of C$0.89$0.63$0.72
Question 4 (43)Replication #Part A LostPart B LostPart C LostPart A GoodPart B GoodPart C GoodLost Production per Week11601849833152015451530$1,907.0321611846835152015461530$1,907.4731601849833152015451530$1,907.0341601849833152015451530$1,907.0351601849833152015451531$1,907.0361611845835152015461530$1,906.8471601849833152015451530$1,907.0381611845835152015461530$1,906.8491601849833152015451530$1,907.03101611846835152015461530$1,907.47Replication #UtilizationPallets in Use10.984742.342420.988542.503530.988242.494440.982642.252350.980942.180160.98642.397670.986242.407980.985242.364490.985842.388100.987542.4641Cost of ACost of BCost of C$0.89$0.63$0.72
Question 4 (44)Replication #Part A LostPart B LostPart C LostPart A GoodPart B GoodPart C GoodLost Production per Week11601849833152015441530$1,907.0321601849833152015441530$1,907.0331601849833152015441...