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Agile Manufacturing and Logistics for the Forest Value Chain VCO Network Workshop February 3-4, 2011 Montréal, Québec Workshop Report Prepared by: Jean-Marc Frayret Département de mathématiques et génie industriel École Polytechnique de Montréal Eldon Gunn Department of Industrial Engineering Dalhousie University Report Submitted 14 june, 2011

Workshop Report - · PDF fileReport Submitted 14 june, 2011 . Introduction This is a report on the VCO Workshop on agile manufacturing and logistics in the Forest Value

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Agile Manufacturing and Logistics for the Forest Value Chain

VCO Network Workshop – February 3-4, 2011

Montréal, Québec

Workshop Report

Prepared by:

Jean-Marc Frayret

Département de mathématiques et génie industriel

École Polytechnique de Montréal

Eldon Gunn

Department of Industrial Engineering

Dalhousie University

Report Submitted 14 june, 2011

Introduction

This is a report on the VCO Workshop on agile manufacturing and logistics in the Forest Value

Chain prepared for the Steering Committee and the Board of the Value Chain Optimization

Network. The workshop was held the 3rd and 4th of February 2011.

Organization of the Workshop

The workshop was initiated by Eldon Gunn and Sophie D’Amours who contacted me during the

fall 2010 session in order to know if I could organize a workshop on agile manufacturing and

logistics with a focus on first transformation. This workshop took place within the Theme 2

working group of the VCO Network.

After several exchange with Eldon Gunn (Dalhousie University), Francis Fournier (FPI), Darrell

Wong (FPI) and Bruce Lehmann (FPI), we decided to organize the workshop in two separate

parts dealing respectively with the research object and the research methodology. Each part

was organized in order to include both a session of presentations during the morning to

introduce the subject, and a session of discussion during the afternoon to give everybody the

possibility to express their opinion and contribute to defining the research orientations to be

followed.

On the one hand, the first part of the workshop was dedicated to understanding and

formalizing the need for agile logistics and manufacturing in the softwood and hardwood

industries. Several presentations were made by researchers from universities and FPI experts in

order to confront the perceptions of academics and industry people from east to west. A

roundtable discussion was then held in order to focus future research efforts in specific

directions.

On the other hand, the second part was dedicated to presenting several simulation tools that

have been developed by the VCO members including Universities and FPI. Indeed, during the

preliminary exchanges prior to the organization of this workshop, we recognized that

simulation was certainly one of the most relevant research tools to study agility and

development new agile manufacturing and logistics strategies. During the afternoon

discussions, two presentations were made to introduce new simulation tools currently

evaluated. These tools could be potentially used to build new simulation capabilities to support

future research development.

As for the other VCO workshop, Mustapha Ouhimmou, the VCO Network Liaison Manager and

Barbara MacKenzie, the Secretary, VCO Network publicized the workshop to all VCO

researchers. They also acted as the clearing centre for expense claims for the Workshop.

Local Arrangements for the Workshop

The coordination of local arrangements was my responsibility and was carried out directly by

me. The workshop was held in rooms M-2204, A-503, C-630 and M-2401 of the Pavillon

Principal and Lassonde of the École Polytechnique de Montréal. The Rotonde space of the

cafeteria was used for lunches. Participants were given the name and address of a Hotel

nearby usually used by the CIRRELT to invite professors. Potential attendees were advised by

Mustapha Ouhimmou to consult the VCO website, which included a tentative program, as well

as directions to the workshop and proposed workshop discussion Topics. Lunch was arranged

for each day and coffee for morning and afternoon sessions. Food quality was excellent.

Participants were left on their own to make arrangements for the evening meal and for any

local transportation.

Workshop Observations

Although a strong snow storm occurred the day before the workshop, which caused several

people to cancel their flight, the workshop “Agile manufacturing and logistics in the Forest

Value Chain” attracted a group of over 20 participants from governmental organizations

(Quebec), forest industry (FPInnovations) and universities across the country (Université Laval,

University of Windsor, University of New Brunswick, University of Alberta, École Polytechnique

de Montréal, Dalhousie University, University of British Columbia). FPInnovations was well

represented as was the staff of the VCO Network.

The first day focused on presenting and defining research issues related to agile manufacturing and logistics in the forest value chain. Eldon Gunn could not introduce as planned the workshop because his flight was delayed. However, his presentation was made later in the afternoon in order to introduce the roundtable discussion. Therefore, Christopher Swartz (McMaster University, Department of Chemical Engineering) introduced the workshop by presenting a research project dealing with robust supply chain design highlighting the need to take into account plant flexibility. Next Darrell Wong (FPI, western division) explained the need to address agility issues from different business model perceptive. Darrell emphasized the existence of many business models including high volume/low cost producers and low

volume/high value producers, each of which has very specific constraints, capabilities and material characteristics. Darrell also highlighted that due to material and process variability there is a relative lack of information available to producers to accurately control their manufacturing and logistic operations (e.g., cost and delivery time) and output mix. The lack of integrated control system was also mentioned. Next, Bruce Lehmann (FPI, western division) explained that plants and operations control systems are designed for a specific business model and are generally more efficient within a specific log diameter distribution. Bruce also mentioned issues to address such as the need to forecast demand, and deal with out-of-spec products and inventory level control. Bruce also discussed the link between batch size (i.e., campaign size) and plant flexibility and explained that control variables include price lists, log diameter, log length and grade, and batch size. Finally, Bruce also discussed to possibility to use postponement strategies, which could be implemented for example through the air-drying of cants. Next, Francis Fournier (FPI, eastern division) discussed the eastern Canada agility issues. In the softwood industry, equipment flexibility involves the ability to process small and large diameter logs, although one market configuration (i.e., output product dimension) is possible at a time. Mills still operate in a push mode, while secondary mills are sometime integrated with sawmills. Francis highlighted to need to provide more logistic services to customers, as well as the need to develop tools to evaluate mills’ configuration with respect to sorting (i.e., log class), inventory levels, etc. In the hardwood industry, Francis explained that procurement operations involved several users for the same stem as well as mixed forest harvesting, which leads to much more complex profitability functions. As far as manufacturing operations are concerned, they are still largely not optimized (i.e., manual) and driven according to NHLA standards (i.e., few producers have adopted a customer-by-customer-based production model). During the afternoon discussion, Eldon Gunn (Dalhousie University) introduced the fundamental concepts of agility (e.g., forecasting, buffering against uncertainty, material and information decoupling points, flow control techniques, inventory vs. customer service, setup time reduction, etc). Eldon explained that there are generally two definition of agility, one involves the ability to remain lean (and therefore efficient) in uncertain conditions, and the second involves the ability to quickly address different market opportunity. Eldon also made a difference between agility in a mill and agility in a network of mills where agility is achieved through collaboration. During the following discussion, several points where debated.

How to design robust plants and evaluate robustness (remaining efficient and profitable under uncertain conditions)?

How to quickly evaluate the impact of modifying the logistic or manufacturing configuration of a plant (e.g., sorting, mills location)?

How to build agility through mills collaboration?

How could information improve system synchronization and efficiency (what is the value of information with respect to profitability)?

What information is more important to know accurately?

The group also concluded that these issues should be studied for two different business

models, instead of focussing on only one, which would narrow the potential transfer of the

research outcome (High volume/low cost producer; low volume/high value producer). Specific

performance indicators should be developed and used for each model. Long term customer buy

back/retention should also be included in the study of these models. Similarly, two regions

should be targeted in order to create case studies.

The second day was dedicated to introducing and debating the research tools required to

achieve the general research agenda identified the first day. Therefore, Francis Fournier

presented Optitek, Joel Mortyn (FPI, western division) presented Simul8, Mathieu Bouchard

(FORAC Consortium, Université Laval) introduced LogiLab and Jonathan Gaudreault (FORAC

Consortium, Université Laval) presented the FORAC experimental platform.

During the afternoon discussion, Eldon introduced the open source simulation tool SymPy and

Alvaro Gil (Jean-Marc’s graduate student) introduced the free NetLogo multi-agent simulation

tool used in a FORAC project to simulate wood auctions in Québec. During the following

discussion, several points where debated.

Agent-based simulation can simulate systems, which components and processes can

have an adapted behaviour (e.i., a behaviour that is a more or less complex function of

the system’s state);

Can multi-agent technology be used in order to dynamically control and balance flow

problems in sawmills and deal efficiently with uncertainty?

Can multi-agent simulation be used to design tools to evaluate plant robustness?

Can a common platform be developed in order to integrate several technologies and

provides a single dataset for experimentation purpose? This point requires an extensive

analysis of the technological issues involved.