FLEET SIZING USING SIMULATION APPROACH AND PROFITABILITY ANALYSIS ON INVESTMENT OF I- FLEET SIZING USING SIMULATION APPROACH AND PROFITABILITY ANALYSIS ON INVESTMENT OF I-TROLLEY IN HARD DRIVE MANUFACTURER.
FLEET SIZING USING SIMULATION APPROACH AND
PROFITABILITY ANALYSIS ON INVESTMENT OF ITROLLEY IN HARD DRIVE MANUFACTURER
A THESIS
Submitted in Partial Fulfillment of the Requirement for the Bachelor Degree
of Engineering in Industrial Engineering
RADINAL WIBISONO
12 14 07099
INTERNATIONAL INDUSTRIAL ENGINEERING PROGRAM
DEPARTMENT OF INDUSTRIAL ENGINEERING
FACULTY OF INDUSTRIAL TECHNOLOGY
UNIVERSITAS ATMA JAYA YOGYAKARTA
YOGYAKARTA
2016
ii
iii
ACKNOWLEDGEMENT
The author conducted the research on Fleet Sizing using Simulation Approach
and Profitability Analysis on I-Trolley Investment in Hard Drive Manufacturer to
fulfill partial requirement to earn bachelor degree of Industrial Engineer of
Universitas Atma Jaya Yogyakarta.
The author would like to deliver gratitude and thankfulness to God for such a
kindness a good grace. The author would like to deliver highest appreciation to
Mr. The Jin Ai, D.Eng. and Mrs. Deny Ratna Yuniartha, S.T., M.T. as faculty
supervisor and co-supervisor for the guidance during conducting this research.
Highest appreciation also goes to Mrs. Ririn Diar Astanti, D.Eng. as Coordinator
of International Industrial Engineering for the help during study period in
Universitas Atma Jaya Yogyakarta.
The deepest appreciation for Mr. Hatmarto, Mrs Ermin Widijanti, Mrs. Aninditya
Radini, and Mrs. Radita Angelina for their love and dedication from the beginning
until finishing this research. Great gratitude is given to Mrs. Grace Natalia S.T. for
her support in conducting this research.
Big appreciation goes to author’s family, relatives, and friends especially from
Industrial Engineering batch 2012, teaching assistant in work system design lab,
production system lab, and optimization modelling lab for all the supports given to
the author. Last but not least, author is amicable for suggestions that boost the
motivation for the next research.
iv
TABLE OF CONTENT
CHAPTER TITLE
1
2
3
PAGE
Title Page
i
Identification Page
ii
Statement of Originality
iii
Acknowledgement
iv
Table of Content
v
List of Table
vii
List of Figure
viii
List of Appendices
ix
Abstract
x
Introduction
1
1.1. Background
1
1.2. Problem Formulation
5
1.3. Objectives
5
1.4. Scope and Limitations of Research
5
Literature Review
6
2.1. Automated Material Handling System
6
2.2. Fleet Sizing
7
2.3. Flow Shop and Queuing Model
9
2.4. Simulation Approach
10
2.5. Statistical Analysis
12
2.5. Economic Profitability
13
2.6. Time Study
14
2.7. Research Contribution
15
Methodology
17
3.1. Preparation Stage
17
3.2. Data Collection Stage
18
3.3. Model Development
19
3.4. Feasibility Analysis
19
v
4
5
6
7
3.5. Final Project Writing and Presentation
20
Data Collection
22
4.1. General Situation
22
4.2. Phase One
23
4.3. Phase Two
26
4.4. Cycle Time
30
4.5. Cost
34
Model Development
37
5.1. Model Development
37
5.2. Model Verification and Validation
42
5.3. Simulation Running
44
Feasibility Analysis
49
6.1. Payback Period
49
6.2. Internal Rate of Return
51
6.3. Sensitivity Analysis
51
Conclusion and Suggestion
54
7.1. Conclusion
54
7.2. Suggestion
55
References
56
Appendices
60
vi
LIST OF TABLE
Table 2.1.
Material Handling Equipment Based on Layout Type
Table 2.2.
Summary of Literature Review
16
Table 3.1.
Summary of Data Taken
19
Table 4.1.
Work Elements in Start Point (Phase One)
25
Table 4.2.
Work Elements in End Point (Phase One)
26
Table 4.3.
Summary of Data Taken in Phase One
26
Table 4.4.
Work Elements in Start Point (Phase Two)
29
Table 4.5.
Work Elements in End Point (Phase Two)
29
Table 4.6.
Summary of Data Taken in Phase One
30
Table 4.7.
Operator Cycle Time
31
Table 4.8.
Operator Required on Phase One
31
Table 4.9.
Operator Required on Phase Two
32
Table 4.10.
Inter-Arrival Time in Backend Stream Station
33
Table 4.11.
Cycle Time in Pack 2
34
Table 4.12.
Summary of Cost Parameter
36
Table 5.1.
Module Used in ARENA Software
38
Table 5.2.
Maximum Entities on Each Replication
43
Table 5.3.
Overview on Maximum Entities in Simulation Model
44
Table 5.4.
Summary Result on Initial Simulation
44
Table 5.5.
Summary Result on 80 Replications
45
Table 5.6.
Scenario in Simulation of I-Trolley Number
46
Table 6.1.
Cost, Investment, and Savings Component
49
Table 6.2.
Cash Flow Calculation
50
Table 6.3.
Cash Flow Calculation during Eight Year
51
Table 6.4.
Cash Flow in Annual Period
51
Table 6.5.
Scenario on Sensitivity Analysis
53
vii
7
LIST OF FIGURES
Figure 1.1.
Procedure of I-Trolley Operation
3
Figure 1.2.
I-Trolley Planning Phase
4
Figure 1.3.
I-Trolley Prototype
4
Figure 2.1.
Material Handling Equipment Based on Flow Rate and
6
Distance Moved
Figure 2.2.
Overall Fleet Sizing Procedure
Figure 2.3.
Process in Simulation Study
11
Figure 3.1.
Methodology for Final Project
21
Figure 4.1.
L-Cart
23
Figure 4.2.
Tote Box
23
Figure 4.3.
Layout of Phase One
24
Figure 4.4.
Kanban Trolley
26
Figure 4.5.
Layout of Phase Two
28
Figure 4.6.
Time Distribution of Backend Stream Station
33
Figure 4.7.
Time Distribution of Pack 2
34
Figure 5.1.
Process Flow Diagram
37
Figure 5.2.
Complete Model on ARENA Software
39
Figure 5.3.
Model in ARENA for Start Point in Phase One
40
Figure 5.4.
Model in ARENA for End Point in Phase One
40
Figure 5.5.
Model in ARENA for Start Point in Phase Two
41
Figure 5.6.
Model in ARENA for End Point in Phase Two
41
Figure 5.7.
Generate Model in ARENA Software
42
Figure 5.8.
Feature to Verify Model in ARENA Software
42
Figure 5.9.
Comparison of Flow Time between Scenarios
46
Figure 5.10.
Comparison of Production Volume between Scenarios
47
Figure 5.11.
ANOVA Analysis on Flow Time
48
Figure 5.12.
ANOVA Analysis on Production Volume
48
viii
9
LIST OF APPENDICES
Appendix 1
Uniformity and Sufficiency Test Loading I-Trolley
60
Appendix 2
Uniformity and Sufficiency Test Unloading I-Trolley
61
Appendix 3
Uniformity and Sufficiency Test Transporting to Pack 2
62
Appendix 4
Uniformity and Sufficiency Test Transporting from Pack 2
63
Appendix 5
Uniformity and Sufficiency Test Transporting to Backend
64
Stream Line
Appendix 6
Uniformity and Sufficiency Test Transporting from Backend
65
Stream Line
Appendix 7
Uniformity and Sufficiency Test Unloading from Lift
66
Appendix 8
Uniformity and Sufficiency Test Loading to Lift
67
Appendix 9
Result on Simulation Running
68
ix
ABSTRACT
The thesis entitled “Fleet Sizing Using Simulation Approach and Profitability
Analysis on Investment of I-Trolley in Hard Drive Manufacturer” began with
problem occurred in hard drive manufacturer in determine number of automated
material handling used in production floor. The purpose of automated material
handling is to replace human power in material handling activity due to efficiency
in transportation activity. Hard drive manufacturer decide to use I-Trolley.
Industrial Engineering Department in the project is responsible to determine
optimum number of I-Trolley or can be defined as fleet sizing of I-Trolley and
operator needed to operate I-Trolley. I-Trolley will implemented in the first floor
and there will be two phases of I-Trolley implementation. First phase is
implementation of I-Trolley between backend stream (BES) station to Pack 2
station and second phase will be implemented between lift to BES station. ITrolley route is closed loop and have two stop point for loading and unloading
activity. Operator requirement in operating I-Trolley is analyzed using time study.
The objectives of this research to have optimum number of I-Trolley based on
minimum material waiting time and maximum capacity in production floor.
The conclusion on optimum number of I-Trolley is 14 with phase one and phase
two respectively need six and eight. ANOVA analysis shows that there is no
significance difference if one I-Trolley added into the scenario. Operator reduced
with I-Trolley implementation is 18 employees. Management decide to accept the
project when investment is feasible in two years. Payback period and Internal
Rate of Return is done and the conclusion is investment feasible in two years.
Sensitivity analysis is also done to support decision making due to maintenance
cost and operator adjustment cost, in example: operator training cost, are
unknown. Decision will not change when maintenance cost is 100 percent of
operation cost and operator adjustment cost is 96 percent of initial investment
cost.
Keywords: Automated Material Handling, Fleet Sizing, Time Study, Economic
Profitability, Simulation, Sensitivity Analysis, Queueing Theory
x
PROFITABILITY ANALYSIS ON INVESTMENT OF ITROLLEY IN HARD DRIVE MANUFACTURER
A THESIS
Submitted in Partial Fulfillment of the Requirement for the Bachelor Degree
of Engineering in Industrial Engineering
RADINAL WIBISONO
12 14 07099
INTERNATIONAL INDUSTRIAL ENGINEERING PROGRAM
DEPARTMENT OF INDUSTRIAL ENGINEERING
FACULTY OF INDUSTRIAL TECHNOLOGY
UNIVERSITAS ATMA JAYA YOGYAKARTA
YOGYAKARTA
2016
ii
iii
ACKNOWLEDGEMENT
The author conducted the research on Fleet Sizing using Simulation Approach
and Profitability Analysis on I-Trolley Investment in Hard Drive Manufacturer to
fulfill partial requirement to earn bachelor degree of Industrial Engineer of
Universitas Atma Jaya Yogyakarta.
The author would like to deliver gratitude and thankfulness to God for such a
kindness a good grace. The author would like to deliver highest appreciation to
Mr. The Jin Ai, D.Eng. and Mrs. Deny Ratna Yuniartha, S.T., M.T. as faculty
supervisor and co-supervisor for the guidance during conducting this research.
Highest appreciation also goes to Mrs. Ririn Diar Astanti, D.Eng. as Coordinator
of International Industrial Engineering for the help during study period in
Universitas Atma Jaya Yogyakarta.
The deepest appreciation for Mr. Hatmarto, Mrs Ermin Widijanti, Mrs. Aninditya
Radini, and Mrs. Radita Angelina for their love and dedication from the beginning
until finishing this research. Great gratitude is given to Mrs. Grace Natalia S.T. for
her support in conducting this research.
Big appreciation goes to author’s family, relatives, and friends especially from
Industrial Engineering batch 2012, teaching assistant in work system design lab,
production system lab, and optimization modelling lab for all the supports given to
the author. Last but not least, author is amicable for suggestions that boost the
motivation for the next research.
iv
TABLE OF CONTENT
CHAPTER TITLE
1
2
3
PAGE
Title Page
i
Identification Page
ii
Statement of Originality
iii
Acknowledgement
iv
Table of Content
v
List of Table
vii
List of Figure
viii
List of Appendices
ix
Abstract
x
Introduction
1
1.1. Background
1
1.2. Problem Formulation
5
1.3. Objectives
5
1.4. Scope and Limitations of Research
5
Literature Review
6
2.1. Automated Material Handling System
6
2.2. Fleet Sizing
7
2.3. Flow Shop and Queuing Model
9
2.4. Simulation Approach
10
2.5. Statistical Analysis
12
2.5. Economic Profitability
13
2.6. Time Study
14
2.7. Research Contribution
15
Methodology
17
3.1. Preparation Stage
17
3.2. Data Collection Stage
18
3.3. Model Development
19
3.4. Feasibility Analysis
19
v
4
5
6
7
3.5. Final Project Writing and Presentation
20
Data Collection
22
4.1. General Situation
22
4.2. Phase One
23
4.3. Phase Two
26
4.4. Cycle Time
30
4.5. Cost
34
Model Development
37
5.1. Model Development
37
5.2. Model Verification and Validation
42
5.3. Simulation Running
44
Feasibility Analysis
49
6.1. Payback Period
49
6.2. Internal Rate of Return
51
6.3. Sensitivity Analysis
51
Conclusion and Suggestion
54
7.1. Conclusion
54
7.2. Suggestion
55
References
56
Appendices
60
vi
LIST OF TABLE
Table 2.1.
Material Handling Equipment Based on Layout Type
Table 2.2.
Summary of Literature Review
16
Table 3.1.
Summary of Data Taken
19
Table 4.1.
Work Elements in Start Point (Phase One)
25
Table 4.2.
Work Elements in End Point (Phase One)
26
Table 4.3.
Summary of Data Taken in Phase One
26
Table 4.4.
Work Elements in Start Point (Phase Two)
29
Table 4.5.
Work Elements in End Point (Phase Two)
29
Table 4.6.
Summary of Data Taken in Phase One
30
Table 4.7.
Operator Cycle Time
31
Table 4.8.
Operator Required on Phase One
31
Table 4.9.
Operator Required on Phase Two
32
Table 4.10.
Inter-Arrival Time in Backend Stream Station
33
Table 4.11.
Cycle Time in Pack 2
34
Table 4.12.
Summary of Cost Parameter
36
Table 5.1.
Module Used in ARENA Software
38
Table 5.2.
Maximum Entities on Each Replication
43
Table 5.3.
Overview on Maximum Entities in Simulation Model
44
Table 5.4.
Summary Result on Initial Simulation
44
Table 5.5.
Summary Result on 80 Replications
45
Table 5.6.
Scenario in Simulation of I-Trolley Number
46
Table 6.1.
Cost, Investment, and Savings Component
49
Table 6.2.
Cash Flow Calculation
50
Table 6.3.
Cash Flow Calculation during Eight Year
51
Table 6.4.
Cash Flow in Annual Period
51
Table 6.5.
Scenario on Sensitivity Analysis
53
vii
7
LIST OF FIGURES
Figure 1.1.
Procedure of I-Trolley Operation
3
Figure 1.2.
I-Trolley Planning Phase
4
Figure 1.3.
I-Trolley Prototype
4
Figure 2.1.
Material Handling Equipment Based on Flow Rate and
6
Distance Moved
Figure 2.2.
Overall Fleet Sizing Procedure
Figure 2.3.
Process in Simulation Study
11
Figure 3.1.
Methodology for Final Project
21
Figure 4.1.
L-Cart
23
Figure 4.2.
Tote Box
23
Figure 4.3.
Layout of Phase One
24
Figure 4.4.
Kanban Trolley
26
Figure 4.5.
Layout of Phase Two
28
Figure 4.6.
Time Distribution of Backend Stream Station
33
Figure 4.7.
Time Distribution of Pack 2
34
Figure 5.1.
Process Flow Diagram
37
Figure 5.2.
Complete Model on ARENA Software
39
Figure 5.3.
Model in ARENA for Start Point in Phase One
40
Figure 5.4.
Model in ARENA for End Point in Phase One
40
Figure 5.5.
Model in ARENA for Start Point in Phase Two
41
Figure 5.6.
Model in ARENA for End Point in Phase Two
41
Figure 5.7.
Generate Model in ARENA Software
42
Figure 5.8.
Feature to Verify Model in ARENA Software
42
Figure 5.9.
Comparison of Flow Time between Scenarios
46
Figure 5.10.
Comparison of Production Volume between Scenarios
47
Figure 5.11.
ANOVA Analysis on Flow Time
48
Figure 5.12.
ANOVA Analysis on Production Volume
48
viii
9
LIST OF APPENDICES
Appendix 1
Uniformity and Sufficiency Test Loading I-Trolley
60
Appendix 2
Uniformity and Sufficiency Test Unloading I-Trolley
61
Appendix 3
Uniformity and Sufficiency Test Transporting to Pack 2
62
Appendix 4
Uniformity and Sufficiency Test Transporting from Pack 2
63
Appendix 5
Uniformity and Sufficiency Test Transporting to Backend
64
Stream Line
Appendix 6
Uniformity and Sufficiency Test Transporting from Backend
65
Stream Line
Appendix 7
Uniformity and Sufficiency Test Unloading from Lift
66
Appendix 8
Uniformity and Sufficiency Test Loading to Lift
67
Appendix 9
Result on Simulation Running
68
ix
ABSTRACT
The thesis entitled “Fleet Sizing Using Simulation Approach and Profitability
Analysis on Investment of I-Trolley in Hard Drive Manufacturer” began with
problem occurred in hard drive manufacturer in determine number of automated
material handling used in production floor. The purpose of automated material
handling is to replace human power in material handling activity due to efficiency
in transportation activity. Hard drive manufacturer decide to use I-Trolley.
Industrial Engineering Department in the project is responsible to determine
optimum number of I-Trolley or can be defined as fleet sizing of I-Trolley and
operator needed to operate I-Trolley. I-Trolley will implemented in the first floor
and there will be two phases of I-Trolley implementation. First phase is
implementation of I-Trolley between backend stream (BES) station to Pack 2
station and second phase will be implemented between lift to BES station. ITrolley route is closed loop and have two stop point for loading and unloading
activity. Operator requirement in operating I-Trolley is analyzed using time study.
The objectives of this research to have optimum number of I-Trolley based on
minimum material waiting time and maximum capacity in production floor.
The conclusion on optimum number of I-Trolley is 14 with phase one and phase
two respectively need six and eight. ANOVA analysis shows that there is no
significance difference if one I-Trolley added into the scenario. Operator reduced
with I-Trolley implementation is 18 employees. Management decide to accept the
project when investment is feasible in two years. Payback period and Internal
Rate of Return is done and the conclusion is investment feasible in two years.
Sensitivity analysis is also done to support decision making due to maintenance
cost and operator adjustment cost, in example: operator training cost, are
unknown. Decision will not change when maintenance cost is 100 percent of
operation cost and operator adjustment cost is 96 percent of initial investment
cost.
Keywords: Automated Material Handling, Fleet Sizing, Time Study, Economic
Profitability, Simulation, Sensitivity Analysis, Queueing Theory
x