Question

Assume that if the product requested is not in stock, it needs to be manufactured
before the order handling can continue. In this way, an order can never be rejected.
To manufacture a product, the required raw materials have to be ordered. Two
preferred suppliers provide different types of raw material. Depending on the prod-
uct to be manufactured, raw materials may be ordered from either Supplier 1 or
Supplier 2, or from both. Once the raw materials are available, the product can be
manufactured and the order can be confirmed. On the other hand, if the product
is in stock, it is retrieved from the warehouse before confirming the order. Then
the process continues normally. After confirming the order, the shipment address is
received and the requested product is shipped while the invoice is emitted and the
payment is received. Afterwards, the order is archived and the process completes.

3. Experimental Factors & Responses
- Discuss the potential experimental factors of your simulation study.
- Discuss the potential responses and explain how they should be presented.
4. Models Process Map
- Diagrammatically represent your conceptual model in a form of a process
map
- Make sure that the constructed process map is representative to the model
contents and level of details.

Answer 1

Assume that if the product requested is not in stock, it needs to be manufactured
before the order handling can continue. In this way, an order can never be rejected.
To manufacture a product, the required raw materials have to be ordered. Two
preferred suppliers provide different types of raw material. Depending on the prod-
uct to be manufactured, raw materials may be ordered from either Supplier 1 or
Supplier 2, or from both. Once the raw materials are available, the product can be
manufactured and the order can be confirmed. On the other hand, if the product
is in stock, it is retrieved from the warehouse before confirming the order. Then
the process continues normally. After confirming the order, the shipment address is
received and the requested product is shipped while the invoice is emitted and the
payment is received. Afterwards, the order is archived and the process completes.

The requirements scheduler is the calculation engine which plans and prioritises production and purchasing automatically according to the rules defined on products. By default, the scheduler is set to run once a day (OpenERP automatically creates a Scheduled Action for this). You can also start the scheduler manually from the menu Warehouse ? Schedulers ? Run Schedulers. The scheduler uses all the relevant parameters defined for products, suppliers and the company to determine the priorities between the different production orders, deliveries and supplier purchases.

Calculating Requirements / Scheduling

Scheduling only validates procurements that are confirmed but not yet started. These procurement reservations will themselves start production, tasks or purchases depending on the configuration of the requested product.

You take into account the priority of operations when starting reservations and procurements. Urgent requests, those with a date in the past, or requests with a date earlier than the others will be started first. In case there are not enough products in stock to satisfy all the requests, you can be sure that the most urgent requests will be produced first.

Planning

In OpenERP, you can plan the production in an easy way. Simply by going to Manufacturing ? Planning, you can plan manufacturing orders, work orders and/or work centers.

Scheduler and Just in Time

When you want to work according to the Just in Time way, you should install the module mrp_jit.

If you install this module, you will not have to run the regular procurement scheduler anymore (but you still need to run the minimum order point rule scheduler, or for example let it run daily.)

All procurement orders will be processed immediately, which could in some cases entail a small performance impact.

It may also increase your stock size because products are reserved as soon as possible and the scheduler time range is not taken into account anymore. In that case, you can no longer use priorities for the different picking orders.

Lead times

All procurement operations (that is, the requirement for both production orders and purchase orders) are automatically calculated by the scheduler. But more than just creating each order, OpenERP plans the timing of each step. A planned date calculated by the system can be found on each order document.

To organize the whole chain of manufacturing and procurement, OpenERP bases everything on the delivery date promised to the customer. This is given by the date of the confirmation in the order and the lead times shown in each product line of the order. This lead time is itself proposed automatically in the field Customer Lead Time shown in the product form. This Customer Lead Time is the difference between the time on an order and that of the delivery.

To see a calculation of the lead times, take the example of the cabinet above. Suppose that the cabinet is assembled in two steps, using the two following bills of materials

Security Days

The scheduler will plan all operations as a function of the time configured on the products. But it is also possible to configure these factors in the company. These factors are then global to the company, whatever the product concerned may be. In the description of the company, on the Configuration tab, you find the following parameters:

• Scheduler Range Days: all the procurement requests that are not between today and today plus the number of days specified here are not taken into account by the scheduler.
• Manufacturing Lead Time: number of additional days needed for manufacturing,
• Purchase Lead Time: additional days to include for all purchase orders with this supplier,
• Security Days: number of days to deduct from a system order to cope with any problems of procurement,

Note

Purchase Lead Time

The security delay for purchases is the average time between the order generated by OpenERP and the real purchase time from the supplier by your purchasing department. This delay takes into account the order process in your company, including order negotiation time.

Take for instance the following configuration:

• Manufacturing Lead Time : 1,
• Purchase Lead Time : 3,
• Security Days : 2.

The example above will then be given the following lead times:

• Delivery SHE100: 29 January (= 1st January + 30 days – 2 days),
• Manufacture SHE100: 23 January (= 29 January – 5 days – 1 day),
• Manufacture SIDEPAN: 12 January (= 26 January – 10 days – 1 day),
• Purchase WOOD002 (for SHE100): 15 January (= 26 January – 5 days – 3 days),
• Purchase WOOD002 (for SIDEPAN): 4 January (= 12 January – 5 days – 3 days).

Procurement

In normal system use, you do not need to worry about procurement orders, because they are automatically generated by OpenERP and the user will usually work on the results of a procurement: a production order, a purchase order, a sales order and a task.

But if there are configuration problems, the system can remain blocked by a procurement without generating a corresponding document. Exception management allows you to solve

3. Experimental Factors & Responses
- Discuss the potential experimental factors of your simulation study.
- Discuss the potential responses and explain how they should be presented.

The field called Design of Experiments (DOE) has been around for a long time. Many of the classic experimental designs can be used in simulation studies. We discuss a few in this paper to explain the concepts and motivate the use of experimental design. However, the settings in which real-world experiments are performed can be quite different from the simulation environment, so a framework specifically geared toward simulation experiments is beneficial. Before undertaking a simulation experiment, it is useful to think about why this the experiment is needed. Simulation analysts and their clients might seek to (i) develop a basic understanding of a particular simulation model or system, (ii) find robust decisions or policies, or (iii) compare the merits of various decisions or policies.

The goal will influence the way the study should be conducted (Kleijnen et al. 2005). We focus on setting up single-stage experiments to address the first goal, and touch briefly on the second. Although the examples in this paper are very simple simulation models, the same types of designs have been extremely useful for investigating more complex simulation models in a variety of application areas. For a detailed discussion of the philosophy and tactics of simulation experiments, a more extensive catalog of potential designs, and a comprehensive list of references, see Kleijnen et al. (2005) or Sanchez et al. (2012); other useful references are Kleijnen (2007), Chapter 12 of Law (2007), or Sanchez (2009). The benefits of experimental design are tremendous. Once you realize how much insight and information can be obtained in a relatively short amount of time from a well-designed experiment, DOE should become a regular part of the way you approach your simulation projects

To identify appropriate designs, it is often useful to classify the factors along several dimensions:

• Quantitative or qualitative. Quantitative factors naturally take on numerical values, while qualitative factors do not (though they might be assigned numeric coded values).

• Discrete or continuous (quantitative factors only). Discrete factors can have levels only at certain separated values; an example would be the number of x-ray machines in a hospital, which would have to be a non-negative integer, presumably with some upper bound. Continuous factors can assume any real value, perhaps within some range, such as the speed at which a vehicle is operated.

• Binary or not. Binary factors are naturally constrained to just two levels, like the classification of a part as either defective or non-defective. Non-binary factors could take on more than two values, but might still be tested at only two levels, typically “low” and “high,” or might be allowed to assume (many) more than two levels in the experiment.

• Controllable or uncontrollable. In a simulation experiment all factors are manipulated and controlled, but in reality factors might be controllable or not. For example, the degree or nature of enemy jamming of a communications system would be controlled in a simulation, but not in an actual fight. This can affect how the experimenter interprets the estimates of the effects of factors.

4. Models Process Map

-Diagrammatically represent your conceptual model in a form of a process
map
- Make sure that the constructed process map is representative to the model
contents and level of details.

Creating a process map helps organize processes and makes information visible to everyone. By creating a process map or flowchart, you are producing a visual example of the process to better understand it and see areas for improvement. The act of flowcharting to improve a process was first introduced in 1921 by Frank Gilbreth to the American Society of Mechanical Engineers (ASME).

Preparing for process mapping

It’s important to include everyone involved in the process: workers, suppliers, customers and supervisors. Everyone involved needs to clearly understand what the goals of the process are, agree with deadlines and have some knowledge of basic process mapping. You can create a flowchart by hand or in a software program like Microsoft Word, Microsoft Excel, Microsoft Visio or Microsoft PowerPoint; however, there are other software programs specifically built for creating a process flowchart. Using a process mapping software, especially a cloud-based software like Lucidchart, makes it easy to create, save and share your work. Following these basic steps to creating process maps will make them easier to build and to understand.

Steps to creating a process map

• Step 1: Identify the problem:
  • What is the process that needs to be visualized? Type its title at the top of the document.
• Step 2: Brainstorm all the activities that will be involved:
  • At this point, sequencing the steps isn’t important, but it may help you to remember the steps needed for your process. Decide what level of detail to include. Determine who does what and when it is done.
• Step 3: Figure out boundaries:
  • Where or when does the process start?
  • Where or when does the process stop?
• Step 4: Determine and sequence the steps:
  • It’s helpful to have a verb begin the description. You can show either the general flow or every detailed action or decision.
• Step 5: Draw basic flowchart symbols:
  • Each element in a process map is represented by a specific flowchart symbol, which together represent process mapping symbols:  
    • Ovals show the beginning or the ending of a process.
    • Rectangles show an operation or activity that needs to be done.
    • Arrows represent the direction of flow.
    • Diamonds show a point where a decision must be made. Arrows coming out of a diamond are usually labeled yes or no. Only one arrow comes out of an activity box. If more than is needed, you should probably use a decision diamond.
    • Parallelograms show inputs or outputs.

Step 6: Finalize the process flowchart

• Review the flowchart with other stakeholders (team member, workers, supervisors, suppliers, customers, etc.) to make sure everyone is in agreement.
• Make sure you’ve included important chart information like a title and date, which will make it easy to reference.
• Helpful questions to ask:
  • Is the process being run how it should?
  • Will team members follow the charted process?
  • Is everyone in agreement with the process map flow?
  • Is anything redundant?
  • Are any steps missing?

How to do business process mapping

This requires a commitment of time and energy, but the payoff in understanding and analysis can be large. There are four major steps to a mapping initiative:

• Identify the process. Clearly define what is being mapped and what you hope to gain from it. Make sure the scope is appropriate for your goals.
• Gather information. Observe and study the steps involved, capturing who, what, when, where and how it’s all occurring. Get down to the necessary level of detail. Keep digging and breaking down the process into more detail.
• Interview participants and stakeholders. Talk with the participants in the process as part of your mapping to understand what they are doing. This also often helps to uncover inefficiency, miscommunication and potentially better ways to do things.
• Draw the maps and analyze. Document it all in your Business Process Mapping software, and now you will have the basis for in-depth analysis and interpretation.

To conduct a significant mapping project, you will need to have a support structure in place first. As with any project, you would follow these steps:

• Create a project charter or purpose statement explaining what you plan to do and hope to achieve.
• Have an executive sponsor for the project.
• Select the team to do the work.
• Plan and conduct the mapping, as outlined in the four steps above.

In Business Process Management, the idea is to create a life cycle of continuous improvement. The steps are model, implement, execute, monitor and optimize.