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SIMULATION DESIGNING PAPER.
1. SIMULATION DESIGNING
PAPER.
A Written Simulation Design for Producing Plastic Packaging
for A Product.
By Suhail Attar
Dr. Brian Galli
System Simulation
December, 16, 2014
2. Attar, 1
Table of Contents
Executive Summary.......................................................................................................................2
Problem statement .........................................................................................................................3
Objectives/Goals of the simulation...............................................................................................4
The purpose of the proposal..........................................................................................................4
Assumption of simulation..............................................................................................................6
Constraints......................................................................................................................................6
Process Map....................................................................................................................................9
The Process and data collection..................................................................................................10
Statistical Probability Measurement Methods..........................................................................12
Validation Plan ............................................................................................................................14
Verification Plan .........................................................................................................................14
Next Step Plan ..............................................................................................................................15
Works Cited..................................................................................................................................16
3. Attar, 2
Executive Summary:
Company A is a growing company that manufactures the majority of its products in China.
The company focused its sales in the USA because there is a high interest of its products in it.
Primarily the company makes pocket and small projectors, an area of electronics products that is
currently having good conditions in the USA, and projected to grow more.
Figure 1 Pocket Projector Forecast1
This paper aims to only focus in the issue of product design manufacturing in the USA
illustrated by two unreal companies; Company A for the actual product manufacturer that will
demand the plastic and include it in the final assembly; and Company B the supplier who will
produce the designed plastic for the product. This paper includes a process map showing all the
steps that are taken in between both companies. The paper also, provides statistical data methods
and theories with the related analysis. In addition the paper will address some operational issues
related to the process.
1
Pocket Projector Shipment Forecast to Reach 142M Units by 2018, DisplaySearch Reports, search in
displaysearch.com
4. Attar, 3
Problem statement:
Due to the high demand of its products in the USA, Company A is feeling that it needs to
adapt a more flexible production method (lean production). Last year, Company A started to
develop an assembly plant near its headquarter and distribution center in Tustin, CA, so it can cut
waste and have a better inventory management resulting from the flexibility it aimed for. This
assembly plant only assembles one product of its many types of products the company sells, which
is the smallest projector it have, known in the market as Pocket or Pico Projector. The company
chose this product because it is the product that is having a very high demand in the US compared
to its other products in other countries.
The problem of less flexibility still tackles the production of this product because the
company has just started the assembly last year, and most of the suppliers are located overseas or
in very distant places in the US and Mexico nearly 80% of the suppliers are located in a distant
further than 200 mi from this assembly line that is located in Tustin, CA.
The company will start to deploy the lean production method of a newer version of the
product it is assembling in Tustin, CA, where it will adapt a Just-In-Time supplying method. The
company is aiming to reduce the high percentage of suppliers form far places and for this year it
will start with the plastic exterior packaging of the product because it is mainly changing the
product design, in addition to few other interior electronics inside the projector to improve
performance. The company had planned to deploy the method with the newer product by
contracting with Company B nearly 12 mi away from the assembly plant in Anaheim, CA.
5. Attar, 4
Objectives/Goals of the simulation:
Company A and B:
Develop a design that would be appealing to the market, and fitting for the production.
Company A:
Reducing the suppliers who are over 200 mi away from 80% to 60%.
Conduct a just in time method between its suppliers.
Eliminate problems relating to oversees shipping.
Maximize Profit.
Company B:
Produce the batches in time.
Ship the batches in time.
Minimize costs.
The purpose of the proposal:
The reason Company A chose the US is due to many reason mainly the benefit of new
technologies that would allow plastic to be processed from US shale gas according to Dr. Jonathan
Rich Berry Plastics CEO who stated, “We make a lot of different type of products, we mold those
out of polyethylene, and polypropylene. Today those kind of plastic have to come from oil but one
thing we are excited about is the development of low cost and relatively available North American
6. Attar, 5
Shale Gas. Our raw material can come from gas, and as that infrastructure and that investment
goes in its going to be a tremendous benefit to very plastic.”1
In addition, the labor cost for molding plastic in the US is not costly at all because it is highly
automated2
and benefiting from flexible production resulting in very low variable costs due to high
unit produced with low labor cost and the new advances in manufacturing plastic from gas as
mentioned that will help reducing the raw material prices.
Also, one of the main reason why it is very helpful for the company to manufacture nearby its
assembly plant is simply because it will have better quality results. The main advantage of the Just-
In-Time method taken from the Lean Production approach is that it prizes “flexibility (rather than
efficiency) and quality (rather than quantity),” compared to Mass Production.3
This method is
widely known in the industrial and manufacturing fields that it is the method that revolutionized
Quality, when the Japanese companies such as Toyota Adapted it in the1970s by Taiichi Ohno.4
Finally the major reason why the supplier Off-Shore are not appealing for the nature of the
produced item, and other major factors. According to Autronic Plastic case study titled, “OFF-
SHORE PRICING IS NOT ALWAYS CHEAPER THAN "MADE IN USA" PRODUCTS,” a list
of disadvantages of Off-Shore sourcing mentions that.5
Design and approval process requires constant back-and-forth shipping of parts and
samples resulting in a delay to bringing products to market
1
Taking Stock with Pimm Fox interview with Berry Plastics CEO on Bloomberg Radio. http://youtu.be/5DMmomEjDpo
2
APPLYING AUTOMATION TO PLASTIC INJECTION MOLDING AND ASSEMBLY REDUCES COST. apisolution.com/.
3
Operations Management Creating Value Along the Supply Chain 7th Edition, See page 7
4
Operations Management Creating Value Along the Supply Chain 7th Edition, See page 8
5
OFF-SHORE PRICING IS NOT ALWAYS CHEAPER THAN "MADE IN USA" PRODUCTS
http://apisolution.com/case-study-made-in-usa.php
7. Attar, 6
Shipping a tool and/or parts can add tens of thousands of dollars and more than 8 weeks
to project lead times while increasing the potential risk for damage in-transit
Language barriers and different time zones create communication difficulties
Mold design is not always complete or as expected, making transfer of tool difficult if
not impossible
Instability in foreign currencies can lead to pricing fluctuations and higher costs
Unknown stability or reputability of offshore company leave customer susceptible to
"disappearing act"
Assumption of simulation:
The simulation will be as an example of how a company interested in ordering and
manufacturing plastic can deal with the operational issues addressed in the paper. These
operational issues are mainly the statistical information and the process map with some additional
information. The paper addresses these issues to ensure quality of the process, as well as an
overview of the operation of the process.
Constraints:
Company A
Capital to assemble first 4000 units.
Fixed Costs
o Inventory Space.
o Utility Expenses.
o Factory Space if addition is needed.
8. Attar, 7
Contract price between Company B decided by a quote depending on the
production level and maintenance, such as if Company A desires to have an
operator to take care of the process.
Direct Labor, labor involved in manufacturing.
o Assembly Line Employees (10). (Average salary in that area: $32,000)
Total cost $320,000 per year.
Overhead Costs
o Maintenance Mechanics (3). (Average salary in that area: $34,000)1
Total Cost $102,000 per year.
o Management (4).
o Product / Industrial Designer.
o Packaging.
Selling price Per Unit 189.00
Cost Per Unit 150.00
Target revenue $756,000 form this product.
Company B for Company A’s order.
Material Cost for Acrylonitrile butadiene styrene (ABS) Resins is about $1.29
per lb. 2
Overhead Costs
1
Go to http://www.simplyhired.com/salaries-k-assembly-line-worker-l-murrieta-ca-jobs.html
2
Go to http://www.premierplasticresins.com/abs/abs-black-4-izod-1000-lb-gaylord.html
9. Attar, 8
o Maintenance Mechanics (1). (Average salary in that area: $34,000 about
$30 an hour)1
Total Cost $102,000 per year.
o Packaging.
o Management (4).
o Product / Industrial Designer for designing the molds.
Note. That the focus of this paper is the product design manufacturing, including plastic part in
assembly afterword, and the supply and demand relation between the two companies. The
insourcing that Company A did for the other parts of the whole product the pocket projector was
already done.
1
http://www.simplyhired.com/salaries-k-assembly-line-worker-l-murrieta-ca-jobs.html
11. Attar, 10
The Process and data collection.
1. Desining the product. In this step company A will consult an industrial designing firm
to design the product.
2. If the design is proper. In this step company A will show the design to company B to
apply to production. if the design needs further adjustment company B will send it back
to company A, and company A will contact the design firm to apply the requested
changes.
3. Adjust the automation and the injection molds. In this step company B will design
the molds for the designed product which will take about one day, and program robots
Figure 2 Basic Design by Suhail Attar
12. Attar, 11
process, which will perform the product inspection by laser, some minor assembly, and
packaging the processed plastic which will be done in the same day.
4. Order the first patch. After company B does the adjustments, company A will order
the first patch. The first patch’s quantity is determine by the number of products
company A wants to assemble, which determined by the managerial accounting and
operation research employees.
5. Buy the Raw Material. Plastic Resins. This step is performed by company B, which
they will buy the plastic risen upon the criteria of the design in which what type of
polymers it needs in the design.
6. Produce the Plastic. Company B will perform the production and stop by the time they
finish the patch using two machines. The first one will suck the types of resins and
deposit it in the hopper of the second machine where it will store the plastic resins ready
Figure 3Plastic Injection molding process credits VulcanMold.
13. Attar, 12
to be processed. The machine will transfer the resins to the heaters which will melt and
mix the resins by the reciprocating screw. At the end the plastic get injected in the
molded parts where it takes the shape of the design and cooled, so they come out soled.
After all this is done the molded plastic comes out it is transferred to the inspection part
of the machine where it gets packaged by a robot in the machine the machine can
produce 5 plastic in one minutes.
7. Package the product. The product will be packaged by the robots as soon as it comes
out from production. Each carton box will take 12 plastics.
8. Shipping. The product will be shipped as soon as possible after it is packaged because
the assembly plant is located near the plastic factory and it is not in their interest to fill
their warehouse for a long time, which usually takes about one day at most. Each truck
will take up to 500 carton box. It will take at most 30 minutes to get to company A.
9. Including the designed plastic in the assembly.
The factory takes 10 minutes for each employee to assemble 4 product due to some
human involvement for some complication.
10. Storing the Product in inventory.
Statistical Probability Measurement Methods.
The statistical information will be provided for each step from the process map.
1. Designing the product. Does not need probability measurement.
2. Design inspection. Does not need probability measurement.
3. Designing the Molds Does not need probability measurement.
4. Order the first patch. Does not need probability measurement.
14. Attar, 13
5. Buy the Raw Material. Does not need probability measurement.
6. Produce the Plastic.
a. and R chart
b. Normal distribution
c. First Pass Yield.
d. Binomial distribution
e. Exponential distribution
7. Package the product.
a. and R chart
8. Shipping.
a. Normal distribution.
9. Including the designed plastic in the assembly.
a. Binomial distribution
b. Exponential distribution
c. First Pass Yield
d. Learning Curve for assemblers.
e. and R chart for run times to finish tasks.
10. Storing the Product in inventory. Does not need probability measurement.
15. Attar, 14
Validation Plan
It will take one minute to produce 4 plastic from the plastic injection machine.
o There will be 8 molds in the machine where the plastic would get injected.
o 1 mold for each side of the product which in this case 2 sides.
Time to machine on batch 17 h
o Derived from the order of 4000
It will take each employee Company A 10 minutes to assemble 4 products.
o In one batch cycle 40 units are produced due to 10 workers.
Time for assembly of one batch is about 17 h
Units sold 3898
Verification Plan
This process would not allow for a large amount of error due to the highly automated
characteristics of it.
1. Produce the Plastic.
a. and R chart for run times to know if the machine is producing the product
properly in the time plan.
b. Normal distribution for measurements, to know if the units produced are in a proper
shape and also indicates if the machine need inspection.
16. Attar, 15
c. Binomial distribution for number of successes per batch.
d. Exponential distribution for time between scraped items at inspections.
2. Package the product.
a. and R chart for run times to finish tasks. To be informed that the step would not
take a long time.
3. Shipping.
a. Normal distribution for time of shipping. To know that it would be delivered
properly, even though shipment is no a major issue.
4. Including the designed plastic in the assembly.
a. Binomial distribution for number of successes per batch.
b. Exponential distribution for time between scraped items at inspections
c. Learning Curve for assemblers.
d. and R chart for run times to finish tasks.
Next Step Plan.
The next step is to design the stimulation and make all the necessary calculations,
so an actual estimations can be generated. The major concern in this process is the plastic
casting and the product assembly. However, the fact that the company is adapting a just in
time supply chain method and the high automation of the process the quality issue is not a
very complicated one. The Company can focus in the business side and try to have higher
growth resulting from the newly studied simulation.
17. Attar, 16
Works Cited
1. "APPLYING AUTOMATION TO PLASTIC INJECTION MOLDING AND
ASSEMBLY REDUCES COST." Http://apisolution.com/. Apisolution, 2014. Web. 14
Oct. 2014. <http://apisolution.com/case-study-automation.php>.
2. "OFF-SHORE PRICING IS NOT ALWAYS CHEAPER THAN "MADE IN USA"
PRODUCTS." Http://apisolution.com/. Apisolution, 2014. Web. 14 Oct. 2014.
<http://apisolution.com/case-study-made-in-usa.php>.
3. Taking Stock with Pimm Fox: Berry Plastics CEO on Patent Pending Versalite
Technology. Perf. Pim Fox, Dr. Jonathan Rich. Bloomberg, 2013.
4. "Pocket Projector Shipment Forecast to Reach 142M Units by 2018, DisplaySearch
Reports." <i>DisplaySearch Is the Worldwide Leader in Display Market Research and
Consulting</i>. 28 Apr. 2010. Web. 2 Dec. 2014.
5. "Simply Salary." <i>Assembly Line Worker Salaries in Murrieta, CA</i>. Web.
<http://www.simplyhired.com/salaries-k-assembly-line-worker-l-murrieta-ca-
jobs.html>.
6. "ABS Black - 4 Izod - 1000 Lb Gaylord." <i>Premier Plastic Resins</i>. Web.
<http://www.premierplasticresins.com/abs/abs-black-4-izod-1000-lb-
gaylord.html>.
7. "VulcanMold.com." China Plastic Injection Molding Supplier -. Web.
<http://www.vulcanmold.com/article/Plastic-Injection-molding-process.html>.
