Project #3: Production Cost Savings
at Washington Post
SYST 798/OR 680
Progress Report #1
10 March 2011
Thomas Kuklinski
Timothy Smith
Ling Wu
Vladimir Zivkovic
Where Innovation Is Tradition
Overview
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Clients
Problem Statement
Methodology/Technical Approach
Task Breakdown Structure and Status
Earned Value Management
Issues/Concerns
Way Forward
Questions
Where Innovation Is Tradition
Clients
• Kent Renk, Materials Handling Foreman,
Washington Post, renkk@washpost.com,
703-916-2471 (office), 703-916-2471(cell)
• Kim Hammett, Assistant Superintendent for
Materials Handling, hammettk@washpost.com,
703-916-2447 (office), 703-869-2463 (cell)
Where Innovation Is Tradition
Problem Statement
• Background
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Fall of 2010 GMU students did initial static analysis of the Washington Post’s Shipping
and Receiving Department in Springfield, VA
They conducted a process evaluation, an analysis of labor, and an analysis of routes
which resulted in three recommendations:
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Labor cuts (implemented)
Route simplifications
Improved data tracking
• Problem Statement
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Our objective will be to maximize the efficiency of the Washington Post’s materials
handling system at their four work centers in an effort to generate cost savings to the
overall operation
We would like to bring to life and build upon the static analysis done by previous group
in a dynamic simulation model of the helper component of the work centers
• Stakeholders
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Materials Handling Foreman(Kent Renk)
Where Innovation Is Tradition
Methodology/Technical Approach
• Process Analysis (started)
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Build upon last group’s work done on process evaluation
Develop a complete and detailed qualitative understanding of how the Shipping and
Receiving Department operates
• Data Collection and Analysis (started)
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Collect data from both the materials tracking system (i.e. MTC) and subject matter
experts
Obtain descriptive statistics on each component of the system
• Model Selection and Construction (started)
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Evaluate model alternatives based on quantitative/qualitative data and client needs
Construct and test model (e.g. turn system processes into Arena modules)
• Output Analysis (not started)
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Evaluate output in terms of cost and throughput
Iterate
Where Innovation Is Tradition
Process Analysis
Trucks
1. Daily Insert Ads & Sunday Packaging --->
Daily Insert
Materials
Handling
Racks
2c. Jackets
Run of Press
Headsheets
(outside scope)
Run of Press
Sunday Packaging
Where Innovation Is Tradition
Process Analysis
Where Innovation Is Tradition
Data Collection and Analysis
• Labor data
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Obtained labor markup data for this period
• Broken down by work center, day, shift, and role
Labor assignments are being zoned to different routes within our process
Sunday Packaging: Monday
1st Shift (6:30am-2:00pm)
2nd Shift (2:15pm-9:45pm)
3rd Shift (10:00pm-5:30am)
Collator 1
2
2
0
Collator 2
0
0
0
Collator 3
2
2
0
Collator 4
3
3
3
Total
7
7
3
Where Innovation Is Tradition
Data Collection and Analysis
• Route data
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Obtained Summary Report for February 7-12 created by MTC
Data obtained for a “normal” week of work
Contains pallet moves for all materials throughout the system
MATLAB and MS Excel parsers are being developed to determine (1) raw material
arrival processes, (2) production targets, and (3) route locations, frequencies by
day/shift, and time
Mapping of location IDs in the MTC data are being linked to locations in our system
Client will fill in gaps in the processes not collected in MTC
• Materials not scanned properly
ISSUE DATE PALLET ID
CLASS
DESCRIPTION
LOCATION DATE / TIME
USER ID
LOCATION
DATE / TIME
HAARHOFFDS
RD01
01/06/2011
12:48:45 PM
06/22/2008
R555147
CONSUMABLE
Stretch wrap, clear
06/22/2008
R555147
CONSUMABLE
Stretch wrap, clear
RD01
01/06/2011
01:14:49 PM
MACKLIND
H52A
01/06/2011
01:15:44 PM
06/22/2008
R555147
CONSUMABLE
Stretch wrap, clear
H52A
02/07/2011
05:30:33 PM
KUBEAG
C4CON
02/07/2011
05:30:38 PM
Where Innovation Is Tradition
Model Selection and Construction
• Discussion with client and additional system understanding has allowed us
to settle with an Arena simulation model
• It is very important for the client to be able to use the model to forecast
the impact of different labor markups on production targets for both
daily inserts and Sunday packaging
• Phase 1 - Develop an Arena model that allows the client to play
with “what-if” labor markups to hit production targets (required)
• Phase 2 – Add on an optimization engine that determines labor
markups at minimal cost to the client to hit production targets
(desired)
• Currently constructing a straw man Arena simulation model and
researching Arena modules that would be compatible with our system
Where Innovation Is Tradition
Model Selection and Construction
Monday, Shift 1
Raw Materials
Normal(2, 4)
U(6,8)
EXP(10)
C1 Machine
Dock
Dock
S1 Machine
U(2,5)
Run of Press
Jackets
U(4,5)
Production Targets
EXP(5)
Where Innovation Is Tradition
Task Breakdown Structure and Status
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Earned Value Management
Washington Post Project Earned Value
700
600
500
Hours
400
Earned Value (BCWP)
300
Actual Cost (ACWP)
Planned Value (BCWS)
200
100
0
Where Innovation Is Tradition
Issues/Concerns
• Defining labor zones and their interactions with
components in the Arena simulation model
• Extracting useful information from the given Pallet
Summary Report (missing data)
• Packaging the Arena simulation model
• Graphical User Interface
• Model for each day vs. Large dynamic model
Where Innovation Is Tradition
Way Forward
• Data Collection and Analysis
• Finish extracting relevant data from the Pallet Summary Report
– Determine raw material arrival processes
– Determine production targets
– Determine route distributions
• Modeling
• Complete straw man model
– Labor zones!!
• Create the initial draft of the Arena simulation model using straw man
model
• Meet with sponsors to go over the draft Arena simulation model
• Modify the model based on feedback and clarification from sponsor
Where Innovation Is Tradition
Questions
Where Innovation Is Tradition