Value Stream Mapping: A Dairy Industry Prospective Melvin, A., Baglee, D University of Sunderland
Abstract The purpose of this paper is to present a study on how Value Stream Mapping (VSM) can be applied to the food and drink industry, in particular a company who manufacture yoghurt based products. The aim is to identify areas of waste and how these can be reduced and/or eliminated from the value stream. In order to use the Value Stream Mapping tool it is necessary to firstly define the value of each process and how it relates to the product. Secondly, it is necessary to identify the resources and activities required to manufacture/produce and deliver the product. This also includes an identification of the key suppliers. Finally, the non-value adding activities are identified and suggestions to reduce waste are presented. Suggestions to reduce and/or eliminate waste included new technologies to rapidly cool palletized products, maintenance practices to reduce machine errors and re development of the processing lines to avoid unnecessary movement of goods. It was concluded that in order to reach the target of 20% reduction in CO2 emissions by 2010 there needs to be a change in attitudes regarding energy efficiency and an investment in new technologies. Index Terms—Energy, Refrigeration, Supply Chains, Value Stream Mapping (VSM)
I.
INTRODUCTION
The food and drink manufacturing industry is amongst the UK’s most vital economic sectors. Food and drink products have a tremendous influence on our lifestyle and prosperity; food and drink manufacturing alone is worth £20 billion a year to the UK economy and it employs more than 900,000 people.
Manuscript received (30th January 2008). Melvin, A was with the Automotive and Manufacturing Advanced Practice Department at the University of Sunderland’s School of Computing and Technology. She is now with the Education and Lifelong Learning Department at the University (email:
[email protected]). Baglee, D is with the Automotive and Manufacturing Advanced Practice Department at the University of Sunderland’s School of Computing and Technology (email:
[email protected]). The authors would like to acknowledge the support of the Department for Environment, Food and Rural Affairs (DEFRA) project code CX0511, and the collaborating partners: Bristol, Brunel and London South Bank Universities and the project steering committee and stakeholder group.
978-1-4244-2289-0/08/$25.00 ©2008 IEEE
The food and drink processing industry is the fourth highest industrial energy user in the UK, it is also one of the largest users of refrigeration technology with many businesses within the sector finding that refrigeration costs make up a significant proportion of their energy bill (The Carbon Trust, 2006). Within food manufacturing the dairy and cheese processing industries is particularly electricity demanding (Fritzson & Berntsson, 2005). While the dairy processing industry is becoming more energy efficient through technological processing improvements, it is still an energy intensive industry due to the thermal requirements of many processes, such as pasteurization, ultra heat treatment (UHT) evaporation and spray drying (International Dairy Federation , 2007). The sector employs nearly 40,000 people in milk processing, manufacturing, and distribution occupations. These numbers have been falling over recent years but it does appear that the trend may have stabilised. The industry continues to experience reductions in rapid technological and operational change and changing customer requirements. However, it must be stated that these companies are conscious of the fact that they also have to reduce their energy intensity. In addition, diary industries need to be vigorous and pro-active in order to face pressures from key drivers such as • • • •
Competition Consumer demand Regulation Internal drivers such as changes in ownership, strategy or management
Consumers today are frequently requesting a greater range of products which in turn puts a greater demand on the food processing plants and supply chains. The supply chain has been defined by Stevens (1989) as “a system whose constituent parts include material suppliers, production facilities, distribution services and customers linked together via feed forward flow of materials and feedback of information”. A supply chain is dynamic and involves the constant flow of information, product and funds between different stages. A typical supply chain may involve a variety of stages such as: • Customers
2 • • • •
Retailers Wholesalers/Distributors Manufacturers Component/Raw material suppliers
The appropriate design of the supply chain will depend on both the customer’s needs and the roles of the stages involved. Most dairy supply chains are complex because they contain multiple sources of milk supply, multiple points of manufacture, multiple product and multiple channels of distribution (The Food Chain Centre, 2007). This paper will show how energy reductions can be made throughout the food supply chain in the dairy industry by using Value Stream Mapping to analyse the processes involved in manufacturing and to identify key areas of wastage and possible solutions to overcome these. Value Stream Mapping (VSM) was chosen as a tool to gather information on the food supply chain because it has been used successfully by many organisations to plan and identify internal improvements (Dolcemascolo, 2006). Furthermore when used appropriately it can help the process industry eliminate waste, maintain better inventory control, improve product quality, and obtain better overall financial and operational control (Abdulmalek, Rajgopal, 2005). Jones and Womack (2000) define Value Stream Mapping as ‘‘The simple process of directly observing the flows of information and materials as they now occur summarising them visually and then envisioning a future state with much better performance’’. Value Stream Mapping has been used in previous work by Jones and Womack (1996) & Rother and Shook (1999). These studies focussed on lean manufacturing and how waste can be reduced/eliminated from the value stream. Further studies carried out by Abdulmalek, Rajgopal (2005); Seth, Gupta (2005) & Hines et al (1998) also adopted the ‘lean’ approach to manufacturing and identified the opportunities for lean techniques and product improvements in the manufacturing sectors. More recently value stream maps have been used to understand the flow of material and information in office activities (Tapping, Shuker, 2003: Swank, 2003). These studies have focused on order entry and financial reporting. Furthermore several studies have examined energy consumption in the dairy industry (Sven, 1983., Miller, 1986., Kjaergaard-Jensen, 1999) and individual dairy products (Okoth, 1992; Zehr, 1997) however these studies are restricted to one country (Ramirez & et al 2004). The ultimate goal of VSM is to identify all types of waste in the value stream and to take steps to try and eliminate these (Rother and Shook, 1999). Waste can be any part of a process that takes time and resources but adds no value to the product
and can even includes something as small as taking extra footsteps to bring a product to another part of the factory. Hines et al (1999) discovered that for the vast majority of the time whilst products are within the defined supply chain no value is being added, furthermore in a recent study by The Food Chain Centre (2007) it was found that 20% of the food industries costs are non-value adding. These non-value adding food industry costs may include factors such as waiting time, inappropriate processing, overproduction or unnecessary movement. These actions need to be eliminated to improve the overall production. Value Stream Mapping aids in the development of a “current state map” which shows a visual representation of how the company is currently operating; it records process information and information flow which can be used to identify key wastes, problems and opportunities. Once the current state map has been analysed the future state map can then be produced to show how the company could operate more effectively. Taylor (2005) stated ‘‘Value Stream Maps are a very effective method for summarising, presenting and communicating the key features of a process within an organisation’’. To date little research has been published which focus on using Value Stream Mapping in the dairy industry to help reduce energy usage. This research is based on a case study of a United Kingdom yoghurt processing plant. This is part of a larger research project in which the objective is to identify, develop and stimulate the development and application of more energy efficient refrigeration technologies and business practices for use throughout the food chain The aims of this research were to: • Understand the ‘current state’ of the dairy supply chain. • Identify key areas of waste, problems and opportunities across the dairy supply chain. • Develop a ‘future state vision’ of each of the supply chains. • Develop an ‘action plan’ to achieve the future state. II. METHODOLOGY This section describes the methodological approaches adopted for this research. This includes the value stream mapping of the food manufacturing supply chain and semi structured interviews with key respondents to further enhance the information captured from the shop floor. The Value stream mapping for the case study was carried out based on the methods used by Jones and Womack (1996) and Rother and Shook (1999). These methods were used because value stream mapping tools were first popularised by these authors. Value stream mapping was carried out whilst walking around the factory floor and talking to key individuals in each area.
3 The data collection started in the suppliers department through each of the individual processes identifying the linkages between the states of production and establishing the flow of information and material resources. Data such as process cycle times (CT) and number of workers were also recorded to add to the current state map so an overview of how the company currently operates could be viewed. In order to convert the data obtained into a current state map icons were drawn representing each of the process steps and flow of materials. Logistics, supplier and production control icons were added including the truck icons to show deliveries from suppliers and deliveries to the logistics warehouse. Electronic information flow icons were added to show information sent to and from customers and suppliers and a timeline was placed alongside the current state map to show the approximate process times.
Yoghurt Processing The processes which take place throughout the factory have been summarized as follows: 1.
2. 3.
4. 5. 6.
Upon completion of the mapping exercise an interview guide was designed in order to gain more detailed information about each of the companies with regards to their suppliers, customers and processes, for example: • • •
Customer demand Ordering Frequency Shipping frequency
The questions were open ended and were designed to allow a greater understanding of the company and the way in which each of the processes played a part in the manufacturing of the product. The questions were asked to those representatives whom the site managers had identified as being the most knowledgeable in those particular areas. These interviews allowed a rapport to develop between the researcher and the interviewee therefore allowing the researcher to probe and divulge on the respondent’s answers. This information was vital in understanding what the company does and how they achieve this. The data from value stream mapping and the semi structured interviews was used to construct the current state map of the company (see fig 1). This map shows the processes and information flows of how manufacturing currently operates throughout the factory. It is important to note that only the main product line (identified by the site managers) in the factory was mapped since Value Stream Mapping is a very time consuming process. III. DATA COLLECTION AND ANALYSIS This section will describe the processes which take place throughout the factory and will identify problems and issues the site may have with regards to energy usage and refrigeration and will suggest solutions to these.
7.
On arrival to the site, raw milk is firstly tested for temperature, taste, added water, acidity and antibiotics before the milk is pumped into large storage silos. Raw milk is standardized, pasteurized and homogenised. The processed milk is then transferred to an incubation tank where the temperature is reduced to 41°c. Culture is added accordingly. Mixture is transferred to smaller holding tanks and fruit and flavourings are added as required. The holding tanks are connected to the filling machines and the mixture is pumped into pots, sealed and date stamped. Pots are then placed onto pallets and chilled before despatch.
At the filling stage the yoghurt mixture is around 20-30°c however in order for the product to be despatched to logistics the required temperature is
