Use Case: Pearl Chain Sequencing

Martin Pahulje - November 16, 2021

Supply chain management is a complex and time-consuming process. Every organization's root is its supply chain, so it must run as efficiently and smoothly as possible. Especially in the automotive industry, as every part of a vehicle goes through the supply chain, each aspect must be perfected to be ready for the final product. To ensure that your organization achieves maximum efficiency, guaranteeing timely and quality products, we will take you through a use case to exemplify how you can optimize your supply chain.

Challenges

This use case will follow a major truck and bus manufacturer and the solutions they utilized to optimize their supply chain operations. The company we talk about is a major commercial vehicle manufacturer, providing transport solutions including trucks, vans, buses, and more heavy vehicles. Within their supply chain, a complex assembly line runs in which several vehicle variants are built. These include variations of 2-axle tractor units and 4-axle AWD vehicles. All of which require extreme variations in assembly efforts and individual stations. Furthermore, these operations require belt structures to be fixed in advance, automated guided vehicle (AGV) belt structures for different frame lengths, approximately 90 assembly stations, and high JIS part volumes. Clearly, this company required complex and individualized manufacturing capabilities, hence their search for highly optimized supply chain solutions.

To enhance their manufacturing operations, the truck OEM needed three significant challenges to be addressed. First and foremost, they required program management depending on the market situation. This meant extremely flexible management operations, allowing for quick and timely changes to adapting circumstances. Within this, they needed a build-to-order philosophy with only the occasional stock vehicle. This can be a challenge in and of itself, as a lack of backstock can make an organization more vulnerable to supply chain or environmental disruptions. Furthermore, it was crucial to have high delivery capability, ideally with a delivery time less than or equal to competitors. Simultaneously, program management must remain economical, balancing constant production with fluctuating market demand – a balance that many organizations strive for but not all can achieve. With a high mix of variants and a dependence on market status, flexibility is everything.

The second challenge faced was that the availability and number of order slots depended on the particular variants of the product in question. This meant that every order had different manufacturing requirements, and simultaneously manufacturing would change based on other orders placed. This led to their third challenge – balancing orders. To ensure economic build-ability, the type mix of orders must be kept within defined limits of a percent of which vehicles could be manufactured at a given time. These are challenges that every manufacturing company faces, but there is a solution.

Production Program Control

To solve these challenges, the management team outlined the principles for a production program control. The primary targets would be market orientation, delivery reliability, and build-ability. This control needed to feature realistic designs that would change according to series or market situation, optimizing the OEM's manufacturing flexibility, in addition to program fixes according to a decision calendar. Furthermore, the program control should monitor level changes with a minimum lead time of three months, order reprioritizations with a full order book in direct exchanges with other orders. Sales would review high-priority requests that fall outside of the rule, but the final decision ultimately left to the production department. With these principles in mind, the operations planner then moved on to the structure of production selling. The future program would divide orders into respective type variants to determine empty lots. The composition of these type variants will be agreed upon in advance between sales and production with defined rules. These rules will include minimum and maximum quantities per time unit, such as a month, period, or day, to ensure a balance of orders. This will depend on the lead time (time interval to production date), and rules will be adjusted accordingly. During scheduling, a suitable “empty lot” will then be filled with real customer orders. To ensure balance and order, a system will monitor and determine order compliance within the defined rules.

Pearl Chain and Sequencing

Within scheduling, a pearl chain system was established. A pearl chain is a concept for control and measurement of activities, particularly the path of orders. It mapped out the production sequence, both for completed vehicles and components. In addition to the location of orders, the pearl chain logic also defined the exact sequence of orders. This process began with the transfer of orders, which converted the sales-side order backlog into an assembly order. The “pearl” or order then moved as it was processed in the supply chain, with subsequent orders following. This process was essential for optimizing order processing in the production area, ensuring that both production and sales can monitor orders as they are placed and fulfilled according to defined rules and available lots.

The pearl chain process organized order into sequences, allowing for the planners to collect orders while maintaining balance. At the end of each sequence, orders were properly aligned with customers by considering time, pearl chain logic, and even local constraints. As a result of this sequencing process, MAN was able to see countless benefits and improvements in their manufacturing operations. Some of the most notable features of the flexis sequencer, listed by MAN, include optimized process orientation, user-friendly interfaces, and high transparency due to various prepared views. These features allowed for increased flexibility in the configuration of constraints with minimal limitations in constraint definition. Additionally, with an online graphical display of rule violations and simulation possibilities, MAN can now predict, monitor, and correct violations and disruptions faster than ever before, providing them manufacturing resiliency.

Our Solutions

You may be struggling to deal with highly variant production and extreme fluctuations in assembly efforts in your own organization. To keep variance "buildable" in an economical way with constant cycle times, there are several principles and tools to consider adopting.

Variant-oriented design of the assembly line with flexible working models
Scheduling and slotting that provides a buildable program and order book, ensuring as much balance as possible in advance according to constraints and market situation
Sequencing rules that distribute vehicles according to constraints in the assembly line
Stabilized scheduled sequence (>95% sequence stability)
Visualization tools to display the sequence so that it can react with the personnel deployment necessary to ensure cycle times

So, where do we come in? If you are interested in optimizing your supply chain as the mentioned company has, flexis has solutions for you. We will equip you with scheduling and slotting, sequencing and re-sequencing, and monitoring and visualization modules to optimize order processing. These modules will significantly simplify your order processing operations, ensuring production efficiency and accuracy. Furthermore, flexis offers process support for successful implementation. This will ensure that order processing and production engineering work hand-in-hand throughout the entire process.

Pearl chain sequencing is a robust optimizer of supply chain and manufacturing operations. But, if you are not yet convinced of why you should implement this process in your own supply chain, we will finish off with its major benefits. This sequencing process will provide you with real-time visualization of order status and the supply chain network's demand situation. It includes a highly flexible program where order scenarios can be realized for more significant insights and dynamic considerations of restrictions with data basis for these scenarios. Additionally, with an increase to almost 100% stability of sequences, we will enable the design of highly sophisticated logistics processes based on the pearl chain. With more efficient production and more reliable deliveries, customer satisfaction will significantly increase. Pearl chain sequencing will change the way you process orders and production, and once you adopt it, you’ll wonder how you ever operated without it.

If you want to learn more get your Guide to Sales & Operations Planning