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Evaluating safety buffers' share of utilisation using colour-coded zones
Jönköping University, School of Engineering, JTH, Supply Chain and Operations Management.ORCID iD: 0000-0003-4241-4407
2024 (English)In: Proceedings of the International Working Seminar on Production Economics, Innsbruck, Austria, 14-18 February, 2024, 2024Conference paper, Published paper (Refereed)
Abstract [en]

The rapidly changing world in which companies operate within sets high requirements on being both responsive and cost efficient. At the same time safety buffers play an important role in covering the variations, that cannot be or are not reduced, to maintain a high delivery capability. The dimensioning of safety stock, safety capacity and safety lead time are often based on experience or intuition in practice, without a systematic way of working to evaluate if the safety buffers are of the right size. This research is building on the core of protecting the flow of relevant information and materials by visibility and clear signals as in Demand Driven Material Requirements Planning (DDMRP). This research investigates how colour-coded zones can be developed and utilised for safety buffers, that together with measuring the share of utilisation—how much of the safety buffer is used—can facilitate evaluation and decisions regarding the size of safety buffers in the dimensioning. How colour-coded zones could be used for safety stock, safety capacity and safety lead time in a similar manner as in DDMRP are proposed, and an example is used to illustrate how the measurements and decision making can be done based on empirical insights. This is sought to open possibilities for facilitated evaluation of safety buffers to better balance the costs associated with maintaining safety buffers with the actual safety they provide. Ultimately this can lead to positive effects such as reduced costs and increased responsiveness.

Place, publisher, year, edition, pages
2024.
National Category
Business Administration Production Engineering, Human Work Science and Ergonomics
Identifiers
URN: urn:nbn:se:hj:diva-63813OAI: oai:DiVA.org:hj-63813DiVA, id: diva2:1843971
Conference
Proceedings of the International Working Seminar on Production Economics, Innsbruck, Austria, 14-18 February, 2024
Available from: 2024-03-12 Created: 2024-03-12 Last updated: 2024-04-23Bibliographically approved
In thesis
1. Management of safety buffers for effective delivery capability
Open this publication in new window or tab >>Management of safety buffers for effective delivery capability
2024 (English)Doctoral thesis, comprehensive summary (Other academic)
Abstract [en]

A company's delivery capability is crucial for competitiveness, which becomes challenging due to variations. While some variations can be reduced, safety buffers are important for absorbing remaining stochastic variations. Some actions to reduce variations may require large investments compared to perceived benefits and the alternative of a safety buffer in form of for example materials (i.e. safety stock) lead to tied-up capital that needs to be considered. Some variations are self-induced by internal rules, routines and behaviours, that companies may not reflect on, simultaneously as there is a tendency of excessive safety buffers due to a lack of attention on the safety buffers that enable sufficient delivery capability. In other words, there is a potential to develop in this area that could lead to positive effects such as reduced costs and increased responsiveness in a changing business environment. Companies in two research projects have expressed a need for decision support in managing safety buffers to effectively mitigate negative impacts of variations, and only general development work has been found in the literature. The purpose of this dissertation is therefore to increase understanding of decisions to reduce and absorb variations, guiding the establishment of a process for effective delivery capability in the management of safety buffers.

This dissertation includes six papers that are based on a combination of case studies, literature reviews, conceptual research, and logical reasoning. The factors to consider in the decisions to reduce and absorb variations serves as a basis for proposing a process for the management of safety buffers. The proposed process consists of four subprocesses, six activities, and 32 steps aligned with findings from the appended papers. The findings suggest that a more effective delivery capability can be achieved by using the proposed process and considering a holistic perspective in terms of e.g. cross-functional collaboration, fact-based decision making and the need of working iteratively in the management of safety buffers. The appended papers provide valuable information to facilitate decision making in practice, including a framework for selecting safety buffers.

Abstract [sv]

Ett företags leveransförmåga är avgörande för att vara konkurrenskraftig, vilket försvåras av de variationer som påverkar företaget. Till viss del går det att reducera de variationer som förekommer men säkerhetsbuffertar fyller en viktig roll i att absorbera de stokastiska variationer som trots allt förekommer. Vissa åtgärder för att minska variationer kan kräva stora investeringar, medan alternativet i form av säkerhetsbuffertar av exempelvis material (säkerhetslager) ger en kapitalbindning som behöver beaktas. Det finns variationer som företag själva ger upphov till via interna rutiner, regler och beteenden som företag inte alltid har reflekterat över, samtidigt som det finns en tendens att de säkerhetsbuffertar som används är större än nödvändigt till följd av att de inte uppmärksammas så länge leveransförmågan är tillräckligt bra. Med andra ord finns en utvecklingspotential som kan medföra positiva effekter som minskade kostnader och ökad följsamhet i en föränderlig företagskontext. Företagen i två forskningsprojekt har uttryckt en avsaknad av beslutsstöd för hanteringen av säkerhetsbuffertar för att effektivt överkomma negativa effekter av variationer och endast generellt förbättringsarbete har återfunnits i litteraturen. Syftet med denna avhandling är därför att öka förståelsen om beslut för att reducera och absorbera variationer, som kan utgöra en grund för utvecklandet av en process för effektiv leveransförmåga i arbetet med säkerhetsbuffertar.

Avhandlingen omfattar sex artiklar som baseras på en kombination av fallstudier, litteraturstudier samt konceptuell forskning och logiska resonemang. Faktorer som är lämpliga att beakta i besluten för att reducera och absorbera variationer används som underlag för att föreslå en process för arbetet med säkerhetsbuffertar. Processen inkluderar fyra delprocesser, sex aktiviteter och 32 processteg som sätts i relation till resultat från artiklarna. Resultaten föreslår att en mer effektiv leveransförmåga kan uppnås genom att använda processen och beakta en helhetssyn i form av exempelvis tvärfunktionellt samarbete, faktabaserat beslutsfattande och behovet av att arbeta iterativt i arbetet med säkerhetsbuffertar. Bifogade artiklar ger viktig information som kan underlätta beslutsfattande i praktiken, exempelvis genom ett ramverk för valet av säkerhetsbuffert.

Place, publisher, year, edition, pages
Jönköping: Jönköping University, School of Engineering, 2024. p. 116
Series
JIBS Dissertation Series, ISSN 1403-0470 ; 088
Keywords
management of safety buffers, reduce variations, absorb variations, manufacturing companies, variationsadministration, buffertadministration, tillverkande företag
National Category
Production Engineering, Human Work Science and Ergonomics
Identifiers
urn:nbn:se:hj:diva-64035 (URN)978-91-89785-09-0 (ISBN)978-91-89785-10-6 (ISBN)
Public defence
2024-05-17, E1405 (Gjuterisalen), Tekniska Högskolan, Jönköping, 09:00 (English)
Opponent
Supervisors
Available from: 2024-04-23 Created: 2024-04-23 Last updated: 2024-04-23Bibliographically approved

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