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Simulation-Based Production Planning Based on Logistic Monitoring and Risk Management Aspects

  • Steffen Reinsch
  • Karim Ouali
  • Jens Stürmann

For companies which are part of complex supply chains structures, risk management is getting increasingly important. This development is the result of actual trends that can be observed, especially in the automotive industry. Companies reduce their work in progress to cut down the cost level of stock; certainly the delivery performance is expected to be excellent. However, the reduction of work in progress frequently results in missing parts or raw material. Moreover, the logistic environment is continuously getting more turbulent by continuously fluctuating demands and in some cases - like steel for example - increased delivery times for raw materials. Combined with the mentioned reduction of work in progress, achieving the agreed logistic performance is not ensured without a significant additional effort.

An approach, developed by IPH, is the use of discrete-event simulation tools for the combination of production planning and control methods with logistic monitoring tools. Based on the periodic analyses of the logistic supply chain performance and the simulation of different alternative scenarios, the relevant planning parameters are identified and adopted to the planning processes. For this feedback loop, logistic risk management aspects need to be considered as well. By identifying potential risks and developing counter measures, the logistic performance is increased tremendously and consequently the performance of the complete supply chain is improved.

In this paper, the specific challenges of forging companies that are part of an automotive supply chain are described and lined out. The forging industry is subject to the implementation of new forging technologies for being able to battle the competition from low cost countries. Those new technologies are not only beneficial; they bear a lot of risks for the companies as well. For some technologies, the tool life cannot be forecasted accurately; hence the lot sizes are only estimated roughly and not calculated with a well proofed algorithm.

Keywords

Supply Chain Risk Management Production Planning Forecast Performance Cumulative Quantity 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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Copyright information

© Springer Science+Business Media, LLC 2007

Authors and Affiliations

  • Steffen Reinsch
    • 1
  • Karim Ouali
    • 1
  • Jens Stürmann
    • 1
  1. 1.IPH - Institut für Integrierte Produktion Hannover gGmbHGermany

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