Chapter 7 – Page 6 – The OM Blog by Heizer, Render, & Munson

OM in the News: Making Vaccine Bottles

Combating the Covid-19 pandemic is at the top of the global agenda. Providing vaccines to populations around the globe means providing 8 billion doses—with only one for every person in the world. In addition to the availability of the vaccine, a decisive factor in the race against time is the accessibility of the glass vials. Producers of the vials are massively ramping up their production so as not to become the proverbial bottleneck in the supply chain, reports New Equipment Digest (April 6, 2021).

vaccine

However, medical-grade vaccine vials are not standard glass tubes. They are all made of the special glass borosilicate and require customized production lines. For example, the glass must be resistant to a wide range of chemicals and temperature changes and must not contaminate medicines. Any interaction between the container and the liquid inside must be prevented, as any chemical interference could affect the vaccine. Even the smallest scratch, crack or fissure can render an entire batch unusable, contaminate the line during the filling process or even lead to a machine standstill.

The demands on manufacturers are enormous: it is not only a matter of producing large quantities quickly but also of maintaining particularly high-quality standards. So what is needed is very fast quality control with high reliability in defect detection. One solution is vision systems, our topic on page 296 in Chapter 7. Powerful cameras can capture images of 120 vials per minute to be inspected for dimensional accuracy or surface condition with very high precision. Defects such as cracks, scratches, chips, inclusions or stains are detected with an accuracy of 0.1 square millimeters. Intelligent software enables accurate fault description analysis and classification. Testing takes place at various points in the manufacturing process, such as directly after the bottles have been formed or shortly before packaging.

Classroom discussion questions:

What are vision systems and why are they a useful OM tool?
Which of the quality control tools in Chapter 6 (Figure 6.6) of your Heizer/Render/Munson text could vial producers employ?

OM in the News: The Rise of the Self-Driving Truck

Whatever type of vehicle arrives at the Bay Area headquarters of Aurora, the team can have it running without a driver in just 12 weeks. The transformation involves pulling apart the dashboard, fitting the vehicle with a stack of sensors and computer systems, then installing a “single umbilical” cord to communicate between the vehicle and the self-driving technology.

Aurora has integrated its robotic “Driver” into eight types of vehicle since its founding in 2017. But its system is proving most successful in heavy-duty trucks, which are now a main battleground for autonomous technology as the mass rollout of robotaxis falters. Partnering with Volvo Trucks, Peterbilt, and Kenworth, with a combined US market share of more than 50%, Aurora is a big force in driverless trucking.

truck2

The business case for disrupting the $800 billion U.S. trucking market is clear, writes the Financial Times (March 31, 2021). Two-thirds of America’s consumer goods are transported to market by truck, but laws limiting drivers’ shifts to a maximum of 11 hours mean longer journeys often take several days.

On average 20% of miles driven are empty and not generating revenue, but still generating gas emissions and pollution. The potential for automation to drive consolidation could be easily as big as for cars, as trucks drive 170 billion miles on U.S. highways every year.

Until recently, Silicon Valley has been slow to react to the opportunity. Since Google launched its self-driving car project in 2009, robotaxis have been the sector’s focal point.

A major benefit of self-driving trucks is that the technology they require is simpler to develop. For a driverless ride-hailing service to exist, the car needs to take passengers anywhere in the city. That would require continual mapping to stay up to date, whereas 18-wheelers spend the bulk of their time on the same highways. “It’s basically a straight road where you’re not really even shifting gears, much less having the opportunity to run into a building,” said one industry expert.

Classroom discussion questions:

Why is the potential so great for self-driving trucks ?
What are the weaknesses in using self-driving long-haul trucks?

Teaching Tip: Explaining a Crossover Chart

The Wall Street Journal (March 23, 2021) tackles a question in many minds, namely, are EVs better for the environment than their gas-fueled counterparts? The researchers find that Teslas generate 65% more carbon dioxide emissions than the Toyotas (because of the metals needed for lithium-ion batteries) before they roll off the assembly lines. Then the tide starts to turn and we hit crossover at 20,600 miles driven. The RAV4 burns gas, refined from crude oil. The Tesla refills with electricity, which still burns coal but is getting cleaner each year with more renewables and natural gas. By 200,000 miles, the lifespan of a typical car, the emissions comparison is no longer close.

wsj article

How quickly the U.S. fleet of 280 million cars and pickups switches to EVs will have a huge impact on the country’s overall emissions. They currently contribute 17% of the U.S. total.

We think this graph may pique your students’ attention when you cover crossover charts in Chapter 7, Process Strategies, or when you discuss life cycle ownership in Example S2 in Supplement 5, Sustainabilty.

Classroom discussion questions:

What assumptions are made in this analysis?
When do you think EVs will take over for gas-powered vehicles in the U.S.?

OM in the News: Vaccine Manufacturing in U.S. Races Ahead

Covid-19 vaccine manufacturers are ramping up production, churning out far more doses a week than earlier in the year, progress that is accelerating mass vaccination campaigns in the U.S., writes The Wall Street Journal (March 22, 2021). This is good news and is a followup to our blog (March 21, 2021) how making Covid vaccines is taking away from production of other important drugs. This is a nice place to introduce Figure 7.1 (the four process strategies) to your students.

After a slow start, Pfizer and Moderna have raised output by gaining experience, scaling up production lines and taking other steps like making certain raw materials on their own. Pfizer figured out how to stretch scarce supplies of special filters needed for the vaccine production process by recycling them. (The filters remove certain components from the vaccine during production.) And the company added more high-speed vial-filling lines to its plants.

pfizer2

Moderna took 3 months to make the first 20 million doses of its vaccine last year, but now it is making roughly 40 million a month for the U.S. The U.S. monthly output for the authorized vaccines is expected to reach 132 million doses for March, nearly triple the 48 million in February.

Moderna wasn’t able to produce at maximum capacity right out of the gate because of the need to introduce new equipment and processes in stages. It was still training newly hired workers and encountering issues like equipment malfunctions and holdups in getting replacement parts such as filters. It is planning to further speed output by boosting the number of doses in each vial to 15 from 10. “There has not been a single week since we started that we have not had issues,” said a company exec.

Some 2.5 million people in the U.S. are vaccinated daily on average, up from about 500,000 in early January. The increased output should be enough to fully vaccinate 76 million people in the U.S. in March, 75 million in April, and 89 million more in May.

Classroom discussion questions:

Which process in Figure 7.1 of your Heizer/Render/Munson text best fits the vaccine manufacture?
What factors had made the vaccine so difficult to produce?

Guest Post: Lobsters, Shrinkage, Process, and the Supply Chain

Our Guest Post today comes from Howard Weiss, Professor of Operations Management Emeritus at Temple University.

In Chapter 12’s discussion of inventory, your Heizer/Render/Munson textbook discusses shrinkage and notes that shrinkage is “inventory that is unaccounted for between receipt and time of sale, and occurs due to damage and theft as well as sloppy paperwork.” Shrinkage does not have to occur at any one particular facility but can occur at multiple points throughout the supply chain. A prime example of this is what happens with lobsters.

The usual steps in getting a live lobster from Maine to a restaurant are:
 Catch the lobster in a lobster trap
 Transfer the lobster to the to the ship’s storage well
 Transport the lobster to storage at the wharf
 Truck the lobsters to a dealer
 Transport the lobster to a restaurant
Shrinkage occurs because lobsters die as they move through the supply chain. Each 1% in shrinkage equates to a $5,000,000 loss in sales.

The goal of Process Analysis, as explained in Chapter 7, is to “continuously improve the process.” Currently, researchers at the University of Maine are doing just that by studying the above supply chain in order to try to reduce the time involved in any of the steps and determine which steps would give the greatest benefit if the time is reduced.

Of course, not all lobsters are shipped live and follow the steps above. Some lobsters are euthanized then sent to a processing plant where tails are separated from the rest of the lobster which is processed to produce raw lobster meat. In addition, during the pandemic some fisherman have resorted to selling the lobsters directly to local restaurants or consumers.

Classroom discussion questions:

What factors would be important when shipping live lobsters?
What Ch.7 process analysis tool would be most useful for improving the process?

OM in The News: We Don’t Need 3 Types of Red

In Chapter 7 we bring up the interesting topic of mass customization. Table 7.1 (on p. 284) illustrates the explosion of variety that has taken place in autos, movies, cereals, and thousands of other products as OM uses rapid, low-cost production to fulfill increasingly unique customer demands. What followed in recent decades is that retailers ramped up choices. They tried to capitalize on the shift toward personalization with a desire to please everyone and added variety to tempt people to buy items they didn’t need.

Now, with choices overwhelming shoppers and clogging supply chains, some brands are moving in the opposite direction, writes The Wall Street Journal (Nov. 22, 2020). They are trimming styles and colors in the hope that by eliminating the decision paralysis that grips customers when they are faced with too many options, they can boost sales and reduce markdowns. For example, Coach is cutting its handbag styles by half. Bed Bath & Beyond is reducing its can opener selection by 2/3. Kohl’s is culling its towel offerings by 20% and women’s dress styles by over 40%. In industry parlance, this is known as “buying narrow and deep” and follows Pareto’s 80-20 rule that 20% of a company’s products account for 80% of its sales.

Coach used to produce 1,000 handbag models each season, but now is only making 500. Instead of making two of the same bag, one with a leather strap and the other with a chain, it might make only the leather version. Coach is emphasizing its 3 best-selling colors and weeding out other shades. “We don’t need three types of red,” said the CEO.

A recent Columbia U. study found that people bought more jam when they were shown fewer choices. Only 3% of consumers who were shown 24 types of jams made a purchase. The purchase rate increased to nearly 30% when consumers were shown just 6 varieties. “We live in a world where we think more choice is better even though we recognize that it’s overwhelming,” said the study.

Classroom discussion questions:

What is mass customization and why is it an OM issue?
Give examples of how consumers can be overwhelmed with choices in a supermarket.

OM in the News: Score One for Humans over Supply Chain Robots

Walmart has ended its effort to use roving robots in store aisles to keep track of its inventory, reversing a 5 year push to automate the task with the hulking machines after finding during the coronavirus pandemic that humans can help get similar results.

The retail giant has ended its contract with robotics company Bossa Nova Robotics, with which it joined to add 500 six-foot-tall inventory-scanning machines to stores. Walmart had hoped the technology could help reduce labor costs and increase sales by making sure products are kept in stock, reports The Wall Street Journal (Nov. 3, 2020).

A robot rolled through aisles at a Natrona Heights, Pa., Walmart

Walmart ended the partnership because it found different, sometimes simpler solutions that proved just as useful. As more shoppers flock to online delivery and pickup because of Covid-19 concerns, Walmart has more workers walking the aisles frequently to collect online orders, gleaning new data on inventory problems. It is pursuing ways to use those workers to monitor product amounts and locations, as well as other automation technology.

In addition, Walmart has concerns about how shoppers react to seeing a robot working in a store. It said earlier this year that the Bossa Nova robots would be in 1,000 of its 4,700 U.S. stores, bringing more automation to stores, characterizing the machines as robot “sidekicks” for store workers. (Bossa Nova laid off 50% of its staff after the contract with Walmart ended). Walmart does continue to use other robots in stores, such as floor scrubbers that move through aisles alone.

Classroom discussion questions:

In Ch. 7, we discuss “Technology in Services.” Walmart discontinued the Bossa Nova model, but what technologies does it still depend on in its stores?
What were the strengths and weaknesses of the Bossa Nova robots?

Video Tip: The Automated Sushi Restaurant

Workers are frequently told robots are coming for their jobs, while fast food employees are already starting to see automation creep into their places of employment. Along with kiosks popping up at McDonald’s, diners in Japan have been treated to a sushi-making robot, while in California a robot flips burgers. Chains are thinking more seriously about replacing human staff with technology as a way to combat increased minimum wages and food costs.

Genki Sushi, a Japanese sushi chain expanding throughout Asia, is known for its conveyer belt style of food service, where customers can grab a roll passing by their table. That’s nothing entirely new.

Lately it’s rolled out restaurants in which customers order customized dishes on a tablet. The food is delivered by an automated train which comes straight to the diner’s seat or booth. Upon being seated, everything from sushi to noodle dishes and even cheesecake is delivered by the train. There’s no human involvement at all, even someone to explain the process. Twenty-four sets of tracks crisscross the restaurant, and the train system has the capacity to serve up to 158 patrons at once. When customers are ready to leave, they simply pay for their meal on a self-service machine. They also clear their own tables by simply dropping the plates into a slot that leads to a hidden water-driven conveyor belt.

As we write in Chapter 7 (p.288): “Ultimately, selection of a particular process strategy requires decisions about equipment and technology.” This interesting 3 minute video makes that point to your students.

OM in the News: Amazon Gets U.S. Approval for Drone Fleet

Amazon’s latest drone is designed to carry packages weighing 5 pounds and fly a round-trip distance of 15 miles.

Amazon just received federal approval to establish a fleet of drones and will begin limited tests of package deliveries to customers in the U.S., reports The Wall Street Journal (Sept. 1, 2020).

The approval from the FAA is a milestone in Amazon’s push to use unmanned aircraft to deliver packages to global consumers. The company also has testing sites in Canada, Austria, and the U.K.

Routine drone deliveries to U.S. consumers are still years away, partly because the FAA needs to complete rules for remote identification of more than 480,000 drones currently registered for commercial operations, and issue separate rules permitting drones to fly regularly over populated areas. Amazon has now joined UPS and Wing (a unit of Google) in gaining approval to operate unmanned air fleets in the U.S. for tests involving customer deliveries. Amazon has sought regulatory approval for a broader range of drones and over a larger geographic area than its competitors.

Amazon CEO Jeff Bezos made the ambitious prediction in 2013 that drone-delivered packages would arrive at the doors of customers in 5 years. Although the company completed its first test flight in England in 2016, the process has taken longer than Amazon expected.

Wing last year began to deliver food and other supplies to customers in Virginia. The company has been conducting tests in partnership with Walgreens and FedEx. UPS, which received FAA approval to set up an airline fleet last year, has been using its drones to carry medical supplies at a hospital network in Raleigh, N.C. Other companies such as Uber Technologies have also conducted limited drone-delivery tests in the U.S.

Classroom discussion questions:

What are the strengths and weaknesses of this delivery approach?
Why does Amazon wish to enhance its shipping strategy?

OM in the News: 3D Printing Gets the Checkered Flag

3D printing, or additive manufacturing, is often used for design testing, prototypes, and custom products and increasingly for high-volume products (as noted on page 295 in Ch.7 of your OM text). However, speed is another attribute of 3D printing, as noted by IndyCar in Industry Week (Aug. 21, 2020). As cars prepared for the Iowa 250 race, additive manufacturing found anew way to save the day – fixing an unanticipated issue for IndyCar ( which is the sanctioning body for open wheel car racing… the centerpiece being the Indianapolis 500).

Specifically, when IndyCar made a change to the rules for the 2020 season, they added an aeroscreen wrap-around cockpit windscreen to help protect the driver by deflecting any flying debris away from the driver’s helmet. But, in doing so it restricted the cooling air from flowing into the cockpit and around the driver’s head creating grueling conditions for drivers.

The IndyCar team quickly realized only 3D printing could produce an alternative ahead of the Iowa 250s race within a tight one-week timeframe. IndyCar turned to Stratasys 3D printing technology to develop a new “scoop” to move hot air out of the cockpit. Each scoop took Stratasys about nine hours to print, and in roughly 48 hours, IndyCar had enough scoops for all 24 of its cars just in time for the Iowa 250s doubleheader race. Fans can also see the scoop in action at the upcoming Indy 500.

The speed demonstrated by this 3D printing application documents the growing breath of additive manufacturing. “Obviously, we can’t produce every part on the car but for internal parts, wire and hose guides, ducting or electronics enclosures additive is ideal,” says a Stratus engineer. “It is all about using the right tool for the job.”

Classroom discussion questions:
1. How does additive manufacturing differ from traditional supply chains?
2. What are the limitations of additive manufacturing?

OM in the News: Hotel Robots Help During Covid-19

Room-service robots like Relay reduce in-person interactions between staff and guests.

“Robots that delivered a burger and fries a few years ago were a high-tech gimmick that gave hotel guests a good laugh,” writes The Wall Street Journal (Aug. 12, 2020). Now, manufacturers are suggesting these machines could help guests stay safe during a global pandemic.

Hoteliers and robotics companies say delivery bots like Sovioke’s Relay are cutting down on potentially unsafe interactions between hotel staff and room guests, by offering contactless room service. And cleaning robots, like Maidbot’s Rosie, are vacuuming hallway floors while cleaning crews spend more time than ever sanitizing rooms.

Before the pandemic, bots at one California hotel chain would typically make 200-300 trips a month, mostly ferrying items like toothbrushes or towels from the reception desk, on to elevators, and up to people’s hotel rooms. Those same bots now make about 700 trips a month, as more guests seek to avoid interactions with hotel staff. And there are new types of robots in development that could help hotel owners during the pandemic. Maidbot vacuuming robots are rolling out wet-cleaning and disinfecting machines to further assist housekeepers in virus-proofing room surfaces.

The use of robots in the hotel industry has concerned some that these machines could eventually be used to replace employees. Many U.S. hotels have reduced staff during the pandemic, and although hotel operators and robotics companies insist robots help rather than reduce staff, robots could limit how much extra labor hotels bring on to meet new sanitation demands.

The robots aren’t always perfect. Children can confuse them by trying to get them to move in too many directions at once, causing the bots to get stuck. And sometimes it takes patience and a few programming tweaks before the robots really learn the layout of the hotel.

Classroom discussion questions:

How else is technology changing the hotel industry? (Hint: see Ch. 7 in your Heizer/Render/Munson OM text)
What other tasks might hotel robots perform?

OM in the News and Video Tip: FedEx Recruits Robots

Robotic arms manufactured by Yaskawa America

Sue, Randall, Colin and Bobby are 4 of the most reliable FedEx workers in Memphis. Each clocks 8 hours a day, sorting 1,300 packages an hour. They almost never take breaks, as they are actually 260-pound industrial robot arms.

They work only about half as fast as skilled humans, but they are quickly becoming an important part of the chain that keeps packages flowing. These robots, getting both “eyes” and “brains” that allow them to sense and respond, typify an important and growing trend in automation, writes The Wall Street Journal (Aug. 8-9, 2020). They have cameras which perceive visible light and sensors to perceive depth, and their “brains” are built with machine-learning AI. This gives them a level of adaptability not before seen. (There is an excellent 6 min. video that opens this WSJ article).

But the robots are not about to steal all the jobs in these industries. For now, they’re mostly filling vacancies created by surging demand. The explosion of e-commerce means an explosion in the volume of packages shipped to homes. Some 87 billion parcels were shipped worldwide in 2018—that’s 40 a year to every person in the U.S.—and this volume will more than double by 2025.

The need for social distancing within warehouses means robots can play a role in helping workers do their jobs without being directly adjacent to one another. And logistics companies are still finding it hard to hire people fast enough. (FedEx’s air hub in Memphis currently has 500 job openings). FedEx estimates one human could tend up to 8 robots.

The overwhelming majority of industrial robot arms in the world are still the “dumb” kind: They repeat the same action over and over again—for example welding the same parts together repeatedly on an auto production line. The holy grail of picking technology—a robot that can handle the same variety as a human—will remain out of reach for a long time, in the same way we have yet to create an autonomous vehicle that can handle the same variety of road situations a human can.

Classroom discussion questions:

Why is it so hard for robots to replace warehouse workers?
Why are firms like FedEx more driven to automate?

OM in the News: Why We Ran Out of Meat

Workers donned protective gear at a Tyson poultry-processing plant in Camilla, Ga.

The Covid-19 pandemic has been a debacle for the $213 billion U.S. meat industry, writes The Wall Street Journal (July 10, 2020). For the first time in memory, there wasn’t enough meat to go around. Reduced production forced grocery giants such as Kroger, Costco. and Albertsons to limit how much fresh meat shoppers could buy. Wendy’s had to tell customers that some restaurants couldn’t serve hamburgers.

Deboning livestock and slicing up chickens has long been hands-on labor. Low-paid workers using knives and saws work on carcasses moving steadily down production lines. It is labor-intensive and dangerous work. and remains one of the more hazardous jobs in the U.S. With 4.3 workplace injuries or illnesses per 100 workers in 2018, the industry’s rate is nearly 40% higher than the national average for all industries, surpassing logging, mining and construction.

And factory floors have been especially conducive to spreading coronavirus. In April and May, more than 17,300 meat and poultry processing workers in 29 states were infected and 91 died. Plant shutdowns reduced U.S. beef and pork production by more than 1/3 in April. The companies are searching for a solution–and they think the found one: robotic butchers.

Over the past 3 years, Tyson, the biggest U.S. company (with 122,000 employees out of 585,000 industry-wide) has invested about $500 million in technology and automation. It plans to increase the shift to robots in the aftermath of the pandemic. While some of these robots, such as automated “back saw” cutters that split hog carcasses along the spinal column, labor alongside humans in plants, the finer cutting, such as trimming fat, for now largely remains in the hands of human workers, many of them immigrants. Annual turnover in meat plants ranges from 40% to 70%, versus 31% average for manufacturers.

Yet a growing consumer appetite for products such as deboned chicken and skinless meat has required more people on processing lines. Decades ago, most Americans bought whole chickens. Now, 85% of chicken eaten is parts like breasts and wings or products such as chicken finger.

Classroom discussion questions:
1. Which of the 9 production technology tools described in Ch. 7 in your Heizer/Render/Munson text could be applied to this industry?

2. Why have robots not made a greater headway in meat plants?

OM in the News: How Applications, Automation, Analytics and AI Transform OM

Digital transformation, writes the INFORMS magazine Analytics (June 2020), is leveraging modern technology and innovation so that an organization can help its people achieve maximum capability and the company processes can run optimally. Digital transformation also helps a business focus on its greatest means of success: its customers. Its main technology drivers come from the “Straight A’s”: applications, automation, analytics and AI. Technology, which we discuss in Chapter 7, is a great enabler for organizational productivity, creativity, efficiency and improved profits.

Applications: Ideal business applications help organizations manage business processes and enhance productivity. There are cloud-based business application platforms that provide solutions for end-to-end business processes right from strategy development, product development, work management, project management, field services, customer services, and operations.

Automation: Automating business processes to remove manual, redundant tasks, which can free staff from repetitive, time-consuming work items.

Analytics: Using actionable analytics, organizations can access relevant data and relationships to take immediate action on business initiatives to achieve stronger outcomes.

AI: With AI, companies can literally transform business processes into intelligent systems that will help identify patterns, gain deeper insights from data, and leverage data science to improve fact-based decision-making.

Classroom discussion questions:

What is data analytics, and why is it an important OM tool? (Hint: see Module G in your Heizer/Render/Munson text)
Why is automation so important to U.S. supply chains?

OM in the News: Post-Pandemic Supply Chains and Automation

A U.S.-based engineer working from home uses software to examine a manufacturing line in China.

Factories around the world are turning to technology to help them safely open back up after being shut down by the coronavirus pandemic, reports The Wall Street Journal (June 15, 2020). Software, sensors, robotics and A.I. tools that make it easier for workers to keep their distance in factories and let engineers monitor and fix problems remotely have surged in demand. “Covid has really been the catalyst for the adoption of software solutions to automate workflows and make it more efficient when you have less people around doing things,” said one industry expert.

Manufacturers are focusing on using software to dynamically change assembly lines. And they are using A.I. to remotely do quality inspections in real-time. For U.S. electronics manufacturers, mistakes, defects and wasted time add up to 25% of costs and often require engineers from the U.S. to visit factories in China to fix problems. A.I. systems can scan images of every product produced on an assembly line to identify anomalies and defects. Engineers can then analyze and fix them remotely.

One Calif. food manufacturer remained open during the pandemic by using enterprise resource planning (ERP) software to remotely manage its manufacturing, supply chain and finances, letting 30% of its employees work from home. Meanwhile, technology is helping manufacturers deal with disruption to global supply chains stemming from factory shutdowns. Clear Metal, in San Francisco, has proprietary data from sources such as satellite data, shipping ports and trucking companies, along with A.I. that can predict problems in supply chains and help companies change shipping methods or suppliers in real-time.

And of course, supply-chain problems caused by factories closing in China have caused companies to look to move manufacturing closer to home. The only way to do that is automation, with factories closer to customers. Previously, automation was only used by large factories with budgets of millions of dollars with long production cycles. But automated assembly lines are now available for use in smaller spaces than large factories, with one machine doing the work of 3 people at a fraction of the cost.

Classroom discussion questions:

How can technology help improve OM?
Why is automation important in reshoring?