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Keywords:
Manufacturing network
Uncertainty
Optimization
By designing global manufacturing networks still purely cost-based decisions are made, in which objectives
such as delivery time, quality, exibility, closeness to customer and coordination effort are neglected. The
design and decision-making process becomes more complex, the more inuencing factors of the business
environment are considered. Due to the dynamic and uncertainty of these factors a decision support is
required which includes all relationships in the network and its environment. This paper presents a dynamic
multi-objective optimization model for global manufacturing networks, which evaluates the impact of
changes of inuencing factors and optimizes the global design of the manufacturing network.
2014 CIRP.
1. Motivation
There are approaches that deal with the planning and design of
changeable production systems in order to prepare early for changes in
the business environment. For example, Refs. [18,19] focus on the
evaluation of the adaptability of a production system. However, Ref.
[20] aims more strongly at the economic evaluation of the
changeability of a production system. Besides, there are research
approaches that explicitly focus on the design, evaluation and
optimization of manufacturing networks. These approaches, such as
Refs. [21,22], often describe holistic methods of designing manufacturing networks, while evaluation approaches like Refs. [23,24] provide
new methods for the planning of manufacturing networks, often also
purely focusing on site evaluations. Optimization approaches such as
Refs. [2527] strongly focus on the product-site-allocation and
capacity planning in the manufacturing network. Especially in this
eld, Refs. [15,2830] provide concise summaries and analyses.
In the eld of optimization approaches, many approaches, such as
Refs. [27,3133] do not pursue a multi-objective target hierarchy and
exclusively optimize the network conguration based on cost-oriented
perspectives. Other works such as Refs. [25,34,35] neglect the objective
consideration of qualitative target dimensions despite the multiobjective target hierarchy. However, especially the approach of Ref. [25]
offers considerations for modeling global manufacturing networks that
are the basis for this work. The chosen modeling of the manufacturing
steps and the use of alternative technologies are promising. The
integration of a solution method for the identication of a preferenceoriented optimal conguration of a manufacturing network is neglected,
though. The approach proposed by Kohler [25] identies all paretooptimal solutions based on cost and delivery time. Furthermore, there
are approaches like Ref. [17] that are based on methods of the multiattribute-decision-making class (MADM), although they follow
multi-objective target hierarchy including qualitative criteria. The
disadvantage of such methods is that eventually better, more
* Corresponding author.
http://dx.doi.org/10.1016/j.cirp.2014.03.116
0007-8506/ 2014 CIRP.
398
t
E
s W nt m0
(5)
(6)
399
Fig. 1. Structure of the manufacturing network to discrete time points in planning horizon.
400
via truck). With a total delivery time on average in the network of 4.6
days, 2 days is a big improvement. At the US site, technologies for
almost complete manufacturing process are located. Only
manufacturing step 5 has not been localized. One reason is the
impact of local-content requirements of 37.5%. Moreover, the
proximity to the market is increased by the local production
signicantly by 25%. The delivery times and shipping costs do not
change. In fact, one transport between supplier market Germany to
customer market USA is essential. It can be carried out in one day by
airfreight or 34 days by ships freight. This can be done before the start
of manufacturing, meaning at the time of purchasing material, as in
the case of conguration in 2014, or during the manufacturing
process, as in case of Status Quo year 2012. The situation is similar
with the transport costs. Also, import duties do not differ for the
various steps of manufacturing for the product under consideration. In
China MS 7 and MS 8 are located. Based on the comparison of the local
labor wage in China of CNY 50 per hour to the wage in Germany from
50 s per hour, this change is clearly due to the cost. The quality level of
0.7 compared to 0.85 for Germany in the interval [0,1] deteriorates the
quality objective in average slightly. In India the location is opened in
year 2014 to generate the primary market access through customer
proximity which increases with 25%. Additionally the site meets the
local content requirements of 20%. In fact, simply manual tasks such as
picking of the components and cables that are assembled and nally
checked at the site China, as well as the dispatch of the nished
products for distribution to local customer are localized in India.
In the year 2022 site India gets developed as a full assembly and
checking site. MS 9, 10, 11 and 12 are located in India. On one hand,
labor costs in China with CNY 175 in comparison to India 2588 INR
rising so strong that assembly and checking in India compared to
China is benecial from an overall cost perspective view. In addition,
the site needs to be extended due to the local-content requirement of
35% in India. Finally, the technologies for the MS 9, 10, 11 and 12 can
be utilized sufciently to 65.8% due to increased demand in India, so
that the existing economies of scales through the assembly in China
compared to the start-up and xed costs in India are no longer
adversely for the decision. The progressive qualication of employees in India leads to a qualication level of 0.7, which does not
prevent localization of manufacturing due to poor quality index. In
parallel USA gets fully equipped with the missing MS 5.
5. Conclusion
The presented approach was developed at the Institute of
Production Science (wbk) at KIT, Germany. The model is able to
simulate random developments of drivers of change. In particular
relations between drivers of change of the uncertain business
environment can be generated. Furthermore effects of the environment are evaluated. The optimization module identies the optimal
conguration of the manufacturing networks in terms of suppliers,
sites, technologies and logistics at each point in time during the
planning horizon. The approach was tested in industry and able to nd
an optimal strategy until 2022 according to the dynamic business
environment. The overall approach was realized and implemented in a
software prototype within the research project Planning and
Optimization of global changeable production networks (POWer.net).
Acknowledgments
The ndings presented are being investigated within the research
and development project Planning and Optimization of global
changeable production networks (POWer.net), which is funded by
the German Federal Ministry of Education and Research (BMBF) within
the Framework Concept Research for Tomorrows Production and
managed by the Project Management Agency Karlsruhe (PTKA).
References
[1] Moller K, Klatt T, Drees A (2011) Heutige und zukunftige Paradigmen des
Produktionsstandorts Deutschland. Wertschopfung und Beschaftigung in
Deutschland, Springer Verlag: 1933.