Unilever Foods, a Unilever company that refines oil for the production of margarines such as Rama, Flora and Stork, and produces products for the food service business, has implemented Agilisys Advanced Scheduling to streamline its production chain, from refinement to packing.
In 2000, Unilever globally launched its five-year "Path to Growth" plan, a global initiative to reduce costs through process simplification. Through this plan, the company`s goal is to deliver annual growth of 5% to 6% at a profit margin of as much as 16% starting in 2004.
"All Unilever companies are working to contribute to the goals of Path to Growth," says Aileen McKay, planning manager at Unilever Foods Boksburg. "The organisational changes include a reduction in the number of brands from 1 400 to 400, with a significant reduction in administrative costs, improved customer communication and the optimisation of logistics chains."
As part of the global strategy, Unilever`s two edible fats manufacturing sites in SA were consolidated into one site in Boksburg. The combined plant would include the company`s refining, packing and distribution functions.
"This opportunity resulted in many changes to the existing refinery, creating more flexibility but also more complexity," adds McKay. "Production at the refinery needed to cater for both make-to-stock and make-to-order environments."
Previously, refinery operations were scheduled on a spreadsheet. For the factory to perform optimally, the old method was no longer sufficient and the need for a more sophisticated software tool was identified.
"Implementing a scheduling package means a lot of preparatory work as both the production process and associated bottlenecks have to be defined in detail before any solutions can be devised or implemented," explains McKay.
Unilever Foods therefore drew up a user requirement specification and contracted ApplyIT, the local Agilisys distributor with skills and experience in the implementation and support of supply chain software, to assist it in finding a solution. "We also contacted Unilever companies abroad to determine what they were using and what software was considered best-of-breed for scheduling in the oil processing environment," McKay adds.
Unimills in the Netherlands was using Agilisys Advanced Scheduling, for which it only had praise. Unilever Foods therefore sent its refinery design engineer to Unimills to determine whether Agilisys would meet its requirements.
There are numerous scheduling packages on the market, but only a few cater for batch process modelling. Batch processing, as opposed to discrete production, is typical of food manufacturers such as Unilever Foods. McKay notes that there were two primary factors the scheduling software had to be able to resolve. It had to include the functionality to manage a circular process in which oil may be processed in the same manner more than once. "This looping functionality is essential."
Second, the ability to manage tank space effectively was crucial. "It is essential to have tanks available for storing the final product immediately after the refining process to avoid a bottleneck. Also, you need to schedule the sequence carefully to ensure there is space for all the products being processed as well as the incoming oils to be used in processing," McKay explains.
After a detailed analysis process, Agilisys Advanced Scheduling proved a superior application in terms of ease of use, price and performance.
Within just three months of the purchase decision, the first phase of the implementation was complete and the system could begin scheduling production in the refinery. A second phase of the implementation will be under way shortly and will include automated interfaces with other systems running at the refinery, and the ability to analyse what-if scenarios.
Agilisys Advanced Scheduling is now used to schedule the production of both products that are made-to-stock and made-to-order, ensuring that the process runs as smoothly as possible without any bottlenecks. McKay says Agilisys also assists in deciding when to start the refining process for orders, as some of the products can take up to 10 hours to produce.
Unilever Foods` process control system provides information on the stock balances in each tank on a daily basis. Order information is downloaded to the scheduling software each morning from the company`s SAP R/3 system. Production is then scheduled to meet these orders and spare capacity is used to produce made-to-stock products.
Agilisys also assists Unilever Foods in customer service. If a customer enquires about possible delivery times for a specific order, different scenarios can be run in the application to determine if the customer`s deadline can be met.
As the first company in South Africa to implement Agilisys Advanced Scheduling, McKay says Unilever Foods has learned a few vital lessons and has the following suggestions for companies faced with similar decisions:
* It is vitally important to have good consultants available during the design and implementation phases.
* Someone on the project team must understand the factory extremely well. This enables the company to experiment with different models to see what works best.
* Companies must ensure they have all their master data available, whether from a spreadsheet, ERP system or process control system. The more data that is up to date and accurate, the easier it is to populate the model and develop accurate solutions.
* Insist on visiting a reference site to ensure that the product will meet the candidate company`s specific requirements. McKay says Unilever Foods` visit to Unimills was exceptionally useful.
Since installing the product, Unilever Foods has not had an incident of running out of component oils and blends as a result of bad planning. "Without Agilisys, we simply would have no way of scheduling accurately and would definitely have created problems for our packing hall," McKay says.
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