Fabio Sgarbossa

Consignment stock inventory model in an integrated supply chain

The consignment stock (CS) is an innovative approach to manage inventories in which the vendor removes his inventory and maintains a stock of materials at the buyers plant. The aim of this paper is to promote a successful application and comprehension of the CS policy both in literature and practice. In this paper, we deal with a multi-echelon inventory system in which one vendor supplies an item to multiple buyers. The study develops a single-vendor and multi-buyer consignment stock inventory model in which many clients can establish a CS policy with the same vendor. The aim of the paper is to evaluate the real economical and logistic benefits from the point of view of both the partners and the whole supply chain, following the adoption of a CS policy. We determine the maximum and minimum inventory stock levels to store in the buyers’ plant warehouse and the optimal quantity delivered from the vendor to each buyer in order to minimise total supply chain costs. Space constraints in clients’ plant warehouse, stock-out risk due to the variability of consumption and obsolescence risk for the materials stored are also considered.

Consignment stock inventory policy: methodological framework and model

Consignment stock (CS) is an innovative approach to supply and stock management, based on a strong and continuous collaboration between vendor and buyer to create a ‘win-win’ situation, where both partners have equal gains. An analytic formulation of CS policy with obsolescence has been proposed in Persona et al. (2005). This article considers new critical factors (present in several industrial environments) providing a logical extension of the above mentioned study. The proposed methodology addresses, in particular, the design of a new stock policy in an industrial environment with demand variability, stock-out risk and limited warehouses space. The analytical model presented demonstrates that a traditional stock policy, such as the economic order quantity approach is always more expensive than the consignment stock approach. In addition, the benefits of the CS policy to the supply chain are consistently high including when applied to realities with high demand variation and space limitations.

Sustainable SC through the complete reprocessing of end-of-life products by manufacturers: A traditional versus social responsibility company perspective

Every item produced, transported, used and discarded within a Supply Chain (SC) generates costs and creates an impact on the environment. The increase of forward flows as effects of market globalization and reverse flows due to legislation, warranty, recycling and disposal activities affect the ability of a modern SC to be economically and environmentally sustainable. In this context, the study considers an innovative sustainable closed loop SC problem. It first introduces a linear programming model that aims to minimize the total SC costs. Environmental sustainability is guaranteed by the complete reprocessing of an end-of-life product, the re-use of components, the disposal of unusable parts sent directly from the manufacturers, with a closed loop transportation system that maximizes transportation efficiency. Secondly, the authors consider the problem by means of a parametrical study, by analyzing the economical sustainability of the proposed CLSC model versus the classical Forward Supply Chain model (FWSC) from two perspectives: Case 1, the ‘traditional company perspective’, where the SC ends at the customers, and the disposal costs are not included in the SC, and Case 2, the ‘social responsibility company perspective’, where the disposal costs are considered within the SC. The relative impact of the different variables in the SC structure and the applicability of the proposed model, in terms of total costs, SC structure and social responsibility, are investigated thoroughly and the results are reported at the conclusion of the paper.

Ergonomics in assembly line balancing based on energy expenditure: a multi-objective model

In many assembly systems, ergonomics can have great impact on productivity and human safety. Traditional assembly systems optimisation approaches consider only time and cost variables, while few studies include also ergonomics aspects. In this study, a new multi-objective model for solving assembly line balancing problem is developed and discussed in order to include also the ergonomics aspect. First, based on main features of assembly workstations, the energy expenditure concept is used in order to estimate the ergonomics level, thanks to a new technique, called Predetermined Motion Energy System, which helps rapidly estimate the energy expenditure values. Then, a multi-objective approach, based on four different objective functions, is introduced in order to define the efficient frontiers of optimal solutions. To complete the study, a simple numerical example for a real case is presented to analyse the behaviour of Pareto frontiers varying several parameters linked to the energy and time value.

Innovative real-time system to integrate ergonomic evaluations into warehouse design and management

Full-body integrated system for the real-time ergonomics evaluations.Integrated with many ergonomics assessment methodologies.Development of ad hoc tools for the real-time collected motion data.Available feedback both for the operators and for the engineers and managers.Applications in real warehousing environments. The present paper introduces an innovative full-body system for the real-time ergonomics evaluations of manual material handling in warehouse environments, where all parts of the body are interested during the activities execution. The system is based on inertial sensors with integrated compensation of magnetic interference and long wireless connection that permit its use also in heavy industrial applications. A specific set of tools has been developed in order to elaborate the collected motion data and give real-time evaluation and feedback of ergonomics based on the most used methodologies and extended with others advanced ad hoc tools, such as hands positions analysis, travel distance, time and methods collection calculations. The system has been applied to two different warehouses both for the re-design of the storage area and successively management of the typical warehousing activities, such as picking, packing and others, reducing the risk of musculoskeletal disorders and simultaneous increasing of productivity of systems.

Order picking system design: the storage assignment and travel distance estimation (SA&TDE) joint method

Of all the warehouse activities, order picking is one of the most time-consuming and expensive. In order to improve the task, several researches have pointed out the need to consider jointly the layout of the warehouse, the storage assignment strategy and the routing policy to reduce travelled distances and picking time. This paper presents the storage assignment and travel distance estimation (SA&TDE) joint method, a new approach useful to design and evaluate a manual picker-to-parts picking system, focusing on goods allocation and distances estimation. Starting from a set of picking orders received in a certain time range, this approach allows to evaluate the combinations of product codes assigned to storage locations, aisles, sections or warehouse areas and to assess the most relevant ones, for the best location and warehouse layout, with the aim of ensuring optimal picking routes, through the application of the multinomial probability distribution. A case study is developed as well, in order to clarify the concept that underlies the SA&TDE joint method, and to show the validity and the flexibility of the approach, through the calculation of the saving at different levels of detail.

A Cost Analysis of Systems Subject to Random Field Environments and Reliability

We present a generalized cost model subject to random field environments with considerations of cost to remove failures during testing and warranty periods, and penalty cost due to the system failures. We also determine the optimal release time policies that minimize the expected system cost. Many scientific contributions have been developed in software reliability modeling, while none has studied the manufacturing or industrial system reliability growth yet, considering also the differences between testing and operating environments. The application of the proposed model, in comparison to the nonhomogenous Poisson process Goel-Okumoto model, to an industrial application is discussed to illustrate how the proposed model can be used in practice.

A new methodological framework to implement an RFID project and its application

The introduction of new technologies in the industrial field has consistently seen the development of several different projects: some have been carried out successfully and others have encountered many difficulties, resulting in the failure of the projects. Often this is caused by the lack of the correct methodology to tackle the project and to understand how the new technology could be used in industrial applications. At present, radio frequency identification (RFID) technology represents a new tool of support for the automation of the processes and the improvement of the operating management of a system, being the missing link between the material flow and the information flow. RFID technology is used in a large number of possible applications, like product tracking, animal identification, inventory systems and others. However, in recent years, an inconsistent increase of such applications has been observed, due to the diverse information available on such technology and to the lack of a support method...

Inventory holding costs measurement : a multi-case study

Purpose – Logisticians in the worldwide industry are frequently faced with the problem of measuring the total cost of holding inventories with simple and easy-to-use methodologies. The purpose of this paper is to look at the problem, and in particular illustrate the inventory holding cost rate computation, when different kind of warehousing systems are applied. Design/methodology/approach – A multiple case study analysis is here developed and supported by a methodological framework directly derived from the working group discussions and brainstorming activities. Two different field of application are considered: one related to five companies with manual warehousing systems operating with traditional fork lift trucks; the other is among five companies operating with automated storage/retrieval systems (AS/RS) to store inventories. Findings – The multi-case study helps to understand how the holding cost parameter is currently computed by industrial managers and how much the difference between manual and aut...

Human energy expenditure in order picking storage assignment

Considers human energy expenditure in order picking.Develops a bi-objective approach for a class-based storage assignment problem.Estimates rest allowance based on energy consumption.Compares traditional class-based storage and bi-objective storage assignment. Order picking is the most time-consuming and labor-intensive activity in warehousing. Due to the need to frequently handle items, order picking requires high human energy expenditure and poses a risk environment for workers to develop musculoskeletal disorders. The storage assignment policy in use has a significant impact on human energy expenditure and fatigue during the picking process, but this impact is usually not considered in (management-oriented) decision support models for storage assignment.This paper models and analyzes the integration of human energy expenditure as one dimension of ergonomics into the storage assignment problem using a bi-objective approach that considers both total order picking time and human energy expenditure. Time and energy expenditure depend on the main features of the order picking system, such as item characteristics, item popularity, order profiles, and physical dimensions of the shelf and locations. Pareto frontiers are constructed to understand the impact of the storage assignment policy on the objective functions. Subsequently, a quantitative approach is developed to integrate the energy expenditure rate into the time estimation for a general order picking system based on the introduction of rest allowance. Finally, the results of the model are analyzed and suggestions for the practical application of the model are presented.