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- 1. Sample Inventory Improvement Honey Russom, Patrick Weidner, Beth Yoak April 23, 2019
- 2. The Current Inventory System • WASTE! • Manual process • Lacks visibility & accessibility • Lacks accountability, structure, standardization, & rigor • Safety issues
- 3. Risk Assessment Exposure Probability of Occurrence Loss Range/ Average ($) Expected Annual Loss ($) Misplaced/lost production samples 10% $35,000 - 50,000 $42,500 $4,250 Holding material that should be scrapped 99% $2,000-20,000 $11,000 $10,890 Non-value added employee time 20% $70,000-$90,000 $80,000 $16,000 Material waiting & delaying production results or response to customer 25% ?? ??
- 4. Lean / Inventory Management System • Eliminate waste (resource utilization for non-value added activity) • Inventory • Transportation/Motion • Waiting • Defects • People/Talent/Resources • Improve Safety & Productivity • Reduce tripping hazards & wasted motion • Optimize flow & resources through the lab • Increase visibility of lab contents
- 5. What do we want & need in a system? Voice of the Customer (VOC) • List of all inventory – Who? What? When? Why? Where? • Visibility & Accountability • Easy system to use • Know what is coming & why • Monitor & control inventory levels • Automated notifications/emails to owners of material
- 6. Possible Solutions • Real Time Location System Methods • WLAN • RFID • Barcodes/scanners • Warehouse software (Epicor) • Excel • Email • Training employees
- 7. Implemented Solution – Inventory Management Software (IMS) • Executable application, programmed in-house • Run on any computer with appropriate network access • Add new inventory/edit existing records • Desktop added in lab for increased accessibility
- 10. Next Steps • Department meeting • Automated notifications • MySuccess (LMS) training sessions • OTJ training • Added functionality/granularity
Editor's Notes
- TimkenSteel’s current inventory system is riddled with waste and issues. The inventory “system” is currently a very manual and varied process. Material is received into the lab from many different locations and received by many different people in the lab without a standard process that occurs after the material shows up. Sometimes the owner is notified…and sometimes they are not. If they are not notified, the material often sits for up to a week or two without any action being taken. Sometimes material comes into the lab without any identification and someone needs to spend hours to days trying to determine who it belongs to and why it is in the lab. The system also lacks visibility of what inventory is in the lab and is not accessible by may users of the lab. All of the communication around what material shows up when and why it is here is captured in various individuals mailboxes, and thus the inventory of the lab is not visible or accessible to everyone. This means that if someone wants to know if something is in the lab or who it belongs to, they have to go ask different people in the lab until they find the few people that do know. Further, the system lacks accountability for the people that are responsible for the material is in the lab, so it usually is not stored in the appropriate location or scrapped when it should be. This leads to a lot of material in inventory that should be scrapped or moved and causes lack of space in critical areas that are needed to work on current material. Because we often have material not in designated spaces or not in optimal places to perform work, it increases safety issues like trip hazards and ergonomic issues.
- There are many risks involved with the current system that could lead to expected monetary losses or wastes and a few examples are listed here in the risk assessment. Material could be misplaced, which could lead to us having to get new samples or melting new heats. Getting new samples cut ties up an already constrained saw operation in the plant and could push the order past the promised delivery date, which would hurt customer service and our brand. Some of the samples we get into the lab truly are irreplaceable because they are from a particular test position or maybe only one piece was submitted from the customer for a claim. We also frequently hold material that will not be used for an future testing and could be used as scrap for our melting operations. By holding that material we are not recuperating the scrap value of the material and could be purchasing more scrap for our melt operations than we need to be. Another risk would be the use of employee time for non-value added activity. One of the engineers report approximately 20% of her time spent on managing, organizing, and scrapping inventory through the current manual system. That time would be better spent on new product development or testing and release of production material. There are a few other risks with the current system that are difficult to quantify in terms of a monetary impact. Material often waits at various stages because no one knew it was received, it can’t be located, it was received but no one knew what it was, or someone simply forgot about it. This takes a toll on less tangible things like our on time delivery, brand image, customer satisfaction, etc.
- The goal of this project was to implement some form of inventory management system to help reduce a lot of the waste in the current system. Of the 8 forms of waste in lean manufacturing, 5 of them were very prevalent in the prior system. By keeping these sources of waste in mind and evaluating the ability of proposed solutions to help reduce these wastes, the most beneficial solution could be implemented. By introducing some sort of inventory management system, the lab hopes to improve safety and productivity of the lab while minimizing waste. An inventory system would help minimize the inventory in the lab and therefore reduce tripping hazards and wasted motion. It would also optimize the flow of material through the lab and allow the lab to utilize their resources for more value added tasks. The system would also increase the visibility of all inventory in the lab so that many questions could be addressed by any user of the system.
- Before implementing our system, it was important to first understand what users of the lab would need or want from an inventory system. It was important to get buy-in from users and provide them with a system they would see value in. The critical to customer attributes that were mentioned were a visible list of all the inventory in the lab that was easily sortable or viewable. They wanted to understand who the material belonged to, what the material was, what heat and order it came from, when it showed up or was worked on last, why the material is in the lab, and where did it come from. They needed increased accountability for all employees. The most critical was that the system was easy to use and didn’t waste users time. Some other helpful features would be able to see what material was expected to come into the lab so that resource planning could be considered for future dates, not just what do we need to accomplish today. The system would ideally also help monitor and control the inventory levels so that different locations were not overflowing with material. And lastly, the system would automate the notifications that material was received into the lab so that as soon as it showed up, the owners could be notified through a standard practice.
- The first solutions we reviewed were for real time location system (RTLS) technologies. These include WLAN and RFID. Both methods require tagging the assets intended for tracking with a device that emits a signal. For WLAN, the signal being emitted is a wifi signal. The method of information being received is through a standard wifi transmission. This requires a large wifi infrastructure throughout the warehouse. This can be a positive feature for businesses with this type of infrastructure already in place, but require substantial investment for companies lacking this. We found that WLAN tracking systems can experience issues when used in environments with lots of metal, which made implementation for our project impossible due to the high volume of steel in the lab. The second RTLS system researched was RFID. The tag for this system is a small radio emitting device. The radio signal being emitted details lots of information, but requires a specific scanner to interpret this data. This system would also require heavy investment to create the proper infrastructure to support it. This system was rejected at this time because of the significant costs associated with implementation. Another possible solution was to implementing a barcode and scanner system such that barcode is attached to the material upon receipt and all future movements are tracked through scanners and location barcodes. This would have removed a lot of the manual entry of movements and created a visible map of what and where everything was in the lab. Again, the costs of this system were extremely prohibitive and management denied all possible solutions that required significant financial investment at this time due to budget constraints. The other less expensive systems we discussed were the creation and use of a shared excel spreadsheet, an email system, or just retraining employees in the current system. All three of those options would require minimum investment because they would utilize tools that are already available. Creating a shared excel spreadsheet in which employees log information at different steps of the process would help organize the inventory information; however, the issue of ownership of the document makes it difficult to implement successfully. Because so many employees at so many different departments use this to communicate, we felt the spreadsheet would quickly lose its effectiveness and likely not be kept up to date. The standardized email system would allow communication to flow to multiple departments and employees without the same ownership issue; however, it would be difficult to accurately compile this information. We rejected this method because of the risk of communication becoming too disparate, and difficulty in tracking historical data – and it is the foundation of the current system that is not working in this environment. Retraining employees would be another least cost option and would likely increase standardization of work throughout the lab with material movement and notification practices. This would not address many of the visibility and structure needs or reduce waste in the system, thus this idea was also rejected. The last process we evaluated is the creation of an in house inventory management software system. This system will be discussed in the following slides.
- Because the other proposed solutions were not applicable for our lab set up, were rather expensive to implement, or were not any less manual than the current systems, ultimately after a review with management the approved solution was an executable application that was completely coded and customized internally. The graphical user interface (GUI) for the application is shown to the right. The application was coded in Matlab and compiled such that anyone with a computer and the appropriate network access could run this application; having Matlab installed was not required. This was important because many users do not have licenses for Matlab and that would have been an expensive endeavor. The Inventory Management Software, or IMS, allows user to input new inventory or edit existing inventory in the system all from one window. Because ease of use and accessibility were critical to the customer, it was decided that a desktop computer with the application loaded would be installed back in the lab near the receiving area. By adding this computer, it removed the need for users to always have their laptops in the lab or to go back to their desks to make updates to the system. Ultimately this solution was chosen because the budget for the project was essentially $0 due to cost cutting initiatives underway at the company at this time. The only expense for this system was a “hidden expense” of one of our programmers time for about three weeks (while he also worked on other projects) and the ~$500 we are investing the hardware and infrastructure that needed added to get the working application in the lab. Management and our team felt these expenses were very reasonable for the benefits that would be created with this type of system. Any larger financial investment was not considered when setting up the budget last year and was not able to be implemented. Users do have to manually input all of the material information as well as go back into the system to update any information or movements of the material so additional automation could increase the efficiency of the system in the future.
- The IMS also includes filtering functions from all of the drop down menus, including so that the list of ~400 pallets of material can be easily sorted and viewed as requested by the users. We also created a JMP script that can input the .dat file created by the IMS and allows for greater sorting and filtering if needed. Very few users would need this functional level, but it was considered during coding.
- Here is an example of a record that is completely filled out.
- The IMS system was rolled out to intended users in our department meeting this past Wednesday. We wanted to really explain to the intended users what the benefits of this system for them would be to gain buy-in and support for actually using this system. The official go live date for the IMS is not until May 1st because we are still finishing up the installation of the desktop in the back of the lab. Once that desktop is up and running, all users are being encouraged to use the system. Until the go-live date, a schedule has been created for “super” users who are already trained in the system to help backlog the ~400 pallets that we currently have in inventory. All lab personnel have been told that any material received until May 1st, should be directed to the super users and they will input into the system and notify the owners. The intent is also to have the automated notifications for received material functional by May 1st. The user ID and email for the tech lab have been created and we are currently setting up the task scheduler to generate the automated email notifications. Automated notifications will be for various instances, including: material received, material sitting in various locations for long periods of time (period of time determined by storage location), or material identified as able to be moved or scrapped. In order to make sure that intended users know how to use the system modules are being added to the TimkenSteel Learning Management System which can be electronically assigned and recorded for all users. We are also holding various on the job training sessions with the people that will be the most frequent users of the system over the next couple of weeks. A review meeting has been scheduled for 3 weeks after implementation to review the process and evaluate the effectiveness of the system. At that time we would like to review if any added functionality or granularity should be considered.