Implementation of Industrial Traceability Systems: A Case Study of a Luxury Metal Pieces Manufacturing Company
Abstract
:1. Introduction
2. Literature Review
2.1. Traceability
- Tracking: The ability to locate or follow the path of a given object downstream, i.e., through subsequent observations. It is therefore defined as the ability to follow a product from the raw material stage to the point of consumption;
- Tracing: The ability to identify the origin and characteristics or history of a certain upstream object. Therefore, it is characterised by the ability to verify the past state of a product through its references and historical records.
2.1.1. Supply Chain
- Inventory: Designates all raw and subsidiary materials in stock, the products in the production units and finished product in the warehouse. The changes around stock management policies may not only affect the efficiency, but also the responsiveness of a supply chain;
- Facilities: In this context, these are the locations in which the inventory is stored (warehouse), manufactured or assembled (production);
- Transport: Defines the movement of articles from a certain location to another in the respective chain. For this purpose, there are several services available in the market, and each company is responsible for acquiring them, usually according to its needs;
- Information systems: Essential property for the proper functioning of a supply chain, responsible for communication between the various stages in which its performance is directly correlated with this factor, and the others are conditioned by it. A supply chain with a complete and precise flow of information enables greater responsiveness and efficiency, and traceability is a key element for its success.
2.1.2. The Importance of Traceability
- Identification of the origin: Information regarding the source of raw materials, which are used in the production processes;
- Destination identification: Information relating to product tracking (records location dates);
- Data relating to the handling of product processing: Knowledge of production operations;
- Control information: Information about control results carried out during production.
2.2. Technologies for Automatic Identification and Data Capture
- The average error rate when typing on a keyboard is one error per three hundred characters, or 0.33%;
- Manual methods are intrinsically more time-consuming than automated methods. However, when manual practices are used, there is a time lag between the activities taking place and their introduction in the respective software, i.e., the information is not available in real time;
- Labour costs are associated with the time spent by workers on this type of action.
2.2.1. Barcode
2.2.2. Radio Frequency Identification (RFID)
- Simplification of the monitoring of the industrial production flow and stock management, as this technology contributes to a better localisation of products, real-time updates and automation of operations, thus increasing confidence in decision-making related to supplies;
- In the logistics process, RFID can allow an increase in efficiency, due to speeding up the delivery of products or raw materials, automating goods receipt and dispatch operations and, in this way, it is possible to eliminate operations that do not generate value for the organisation, thus gaining time for employees to focus on activities that add relevance to the business;
- Regarding the end customer, this technology can provide visibility and product information at any point in the supply chain in an automatic and assertive manner, thus improving the reliability of the information flow.
- Electromagnetic interference: Automatic identification and data collection through RFID, for its success, also depends on the type of object in which the tag is inserted. Objects with metallic or liquid content absorb the radiofrequency energy emitted by the reader, which may cause shorter transmission ranges or even the non-identification of the product;
- Sustainability: Not recycling and reusing the labels may be a limitation to be considered. If they are integrated in the object to be identified, it may not be possible to use them again. The non-reuse of electronic waste is a serious risk to the environment and, consequently, to human health.
2.2.3. Comparison between Barcode and RFID Technology
2.2.4. Motivational Factors for Implementing Traceability Systems
- Problem solving: A concept that applies from design, through engineering, to the manufacturing and operational stages;
- Information management: Receiving orders through successful scheduling of information until the delivery of the product;
- Physical transformation: Raw materials that allow a finalisation of the product, in the hands of the customer.
2.2.5. Implementation of Traceability Systems Based on AIDC Technologies
- Research: Gathering relevant information and data on business process equipment, operations, activities, documents and models within the scope of their implementation;
- Information analysis: Based on the data collected, and after the gaps have been identified, the main points and bottlenecks should be determined, where the team will define where they want to spend more resources and control, ensuring that the changes that are envisaged to bridge the identified gaps.
- Installation: After placing all physical equipment, it is recommended to test it immediately, since positions, angles or modes of operation may influence information reading rates. In parallel, the information systems should check if the data passage is operating correctly, as intended;
- Formation: Employees usually have no knowledge or are unfamiliar with this type of technology. Therefore, the project team should first explain to them the benefits and the importance of the need for change, followed by training in the use of the equipment. Nevertheless, it is important to safeguard against resistance to change as it can be a serious problem; employees need to adapt and spend time and effort in order to learn new ways of working;
- Technical and operational support: Whenever necessary, a support team shall intervene for the system users to solve technical problems, such as bugs and defects in the system, and also help them adapt to the use of the new functionalities.
2.3. Feasibility Analysis of Investments in Industry
- Financial evaluation: Verifies if the results that are expected from the investment of capital in the project in question are interesting for the respective entity and its investors;
- Technical evaluation: Evaluates the process engineering and design of the installations and equipment;
- Commercial evaluation: Essentially based on market studies and marketing;
- Economic and social evaluation: Analysis carried out focusing on the effects that the project presents to society, with economic effects for a certain region or country;
- Environmental assessment: Level of impact that the change will bring to the physical environment, which may be positive or negative.
2.3.1. Financial Evaluation
- Productivity: Ratio between what the company produces, output, and what it consumes, input, as expressed by Equation (1). Therefore, an increase in productivity should contemplate cost reduction or production increase measures, while maintaining the quality levels required by customers.
- Efficiency: Ratio between the output generated with the new implementation and the standard output; i.e., before the change. This is expressed by the following Equation (2).
- Production performance: Evaluates the speed of production, i.e., the ratio between the time dedicated only to production and the total time worked, which is the sum of all activity times, and may include, in addition to the duration of production, downtime due to maintenance, failures, information recording and transport movements, among others. This is calculated using the following Equation (3).
- Profitability: Expresses the return generated by the increase in productivity that is profitable, in relation to the projected investment. Its calculation is made based on the net profit obtained during a certain period, e.g., monthly, over the initial investment. Equations (4) and (5) show the formulas for calculating net profit and profitability:
2.3.2. Technical Evaluation
- Identification of bottlenecks: By recording temporal information (time and date) of all movements, it is possible to discover the exact point along the entire production flow that is causing blockages, thus helping to solve them;
- Long waiting times: Following the same registration basis as in the previous point, the system is able to identify times wasted due to delays or failures, i.e., blocked flow due to breakdowns, layout problems or delays in deliveries from suppliers;
- Transportation: Transportation within the factory floor cannot be eliminated, but it can be reduced to the bare minimum. The information provided by the AIDC system can help the company make decisions regarding the acquisition of specialized manufacturing cells at the end of each production unit, or the hiring of operators and the acquisition of flexible equipment;
- Inventory levels: AIDC systems, as already mentioned, provide tools for easy stock accounting. Through this, it is possible to analyse whether inventory levels are reasonable, high or low compared to the current requirements.
3. Case Study
Production Flow
4. Discussion
- Project feasibility (which is complemented be the following section);
- Formation of the project team;
- Analysis of the current situation—identifying divergences and needs;
- “Design” of the entire new operating process, integrating all the equipment necessary for the success of the implementation;
- Implementation of the system.
Project Feasibility Analysis
5. Conclusions
Suggestions for Future Work
Author Contributions
Funding
Conflicts of Interest
References
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European Article Number (EAN) | Stock Keeping Unit (SKU) |
---|---|
Set of coding standards enabling efficient management of global and multi-sector value chains | Variable length, no external standards defined, varying according to company needs |
Universal code that accompanies the product throughout the supply chain | For internal (organization) use only; it may differ from company to company. |
Made up of information that identifies manufacturers, companies, origin of production, among others | Reflects information about the product |
Readers | They detect products with RFID tags; They are devices that emit and receive radio frequency waves. | Antennas | They receive and send signals between the tag and the reader; Their range is directly dependent on the label used. |
Tags | They identify the products that they accompany. | Label Printer | Allows printing of the information, in code form, on the label. |
Software | Encodes and decodes data (information) on RFID tags; Translates the data captured by the reader and subsequently uses it to feed information systems that have planning, business process control and logistics functionality; i.e., communicate with an ERP. |
Barcode | RFID |
---|---|
Definition | |
Technology capable of capturing data and identifying products by reading barcodes. | Technology that uses radio waves to automatically identify objects. |
Applications and impacts on the supply chain | |
Inventory management; Identification of products in logistics processes; Transport management, enabling the identification and registration of mobilized loads. | Automatic product traceability and visibility; Inventory management, with real-time updates; Administration and control of transport activities without operational costs; Increased information flow in supply chains. |
Advantages | |
Technology with years of operation, providing greater confidence in the adoption decision; Lower implementation costs compared to RFID. | Greater information storage capacity compared to barcodes; The information contained in the labels can be varied and is continuously reusable; Capacity to identify several products simultaneously; Accuracy of the data collected, as well as its availability in real time. |
Disadvantages | |
Limited identification characters, which restricts the amount of information that can be traced; Labels can easily become illegible; In most applications, the technology requires an operator to perform the scanning “picks”, thus barcoding is not a fully automated tool (without human intervention). | High cost of implementation; Lack of standardization and legislation at a global level; Requires high levels of security from the user, since this type of technology is totally programmable by its software. For this reason, it becomes an “inviting” target for computer attacks that are prone to invasion of privacy and changes in the data contained in the tag. |
Members | Associated Tasks |
---|---|
Project manager | Plans and controls the schedule; Determines the resources required; Communicates with the different parties, taking decisions when necessary. |
Analyst | Gathers and analyses information on the requirements of the different parties; If necessary, redesigns processes based on the results of the investigation carried out. |
AIDC specialist | Studies the needs exposed and recommends the most suitable traceability solutions in terms of hardware and software. |
System designer | Responsible for the software development, integrating it into the various existing flows in the company. |
Operations department | Provides information on business procedures and operations; Assists communication and integration of the new operating mode. |
Main Problems | Motives |
---|---|
Lack of credibility of information | As mentioned in subchapter 2.2, the average error rate when typing on a keyboard is 0.33% per 300 characters; Information may be out of date. |
Procedural problems | At a procedural level, it can be complex, as the uniformity standards of certain operations can be broken; Excel files tend to be modified by the users themselves, running the risk of forgetting the purpose of their creation. |
Waste and losses | Difficult to monitor the mill orders in progress in the flow, which makes it prone to information loss; The time required to register, investigate and detect anomalies is quite high, as well as being a meticulous task. These follow-up actions and analysis of possible bottlenecks are a key point for the company in the study of the profitability of its production. |
Functional limitations | Ideologies such as FIFO are impossible to practice on a large portion of the raw materials entering the facility; Difficulty in locating working stocks, both in the warehouse and in the operative flow; Traceability of the activity is very detailed and with imprecise information. |
Technologically outdated company | In today’s business landscape, the organization with the highest technological indices gains ground on its competitors, as it carries various tools that facilitate business interactions in all aspects; With the success that the company was achieving, going digital was a strong necessity. |
Decision Variables | Description |
---|---|
Coding nomenclature | The company is in the transition and implementation phase of an ERP. For the use of this software, all items moved in each manufacturing flow, from consumables, raw materials, components, final products, among others, must necessarily have an associated code. Given this fact, several articles are already coded and with associated SKU nomenclature. |
Globalization | Barcode has been operating in the industrial sector for a long time, compared to RFID, and there is now a greater knowledge to facilitate its implementation; This implementation will be for internal use in the management of flows. However, in the future, if there is a need to track the entire supply chain, barcodes are standardized at a global level, which makes it easier to integrate them into it. |
Cost/Benefit | Among the alternatives presented, barcodes and RFID, the former is the one with the lowest cost, about half, from the acquisition of the respective consumables (labels) to hardware; Facing internal needs, barcode technology offers the respective solutions. |
ERP | The software that the company is currently integrating is not yet prepared to interact with RFID technology. |
Operational Department | Operation | Time (h) |
---|---|---|
Logistics | Technical control reception (TCR) | 2.5000 |
Excel—Register of information on quantities checked | 0.0300 | |
Transport 1st phase: logistics >> machining | 0.1700 | |
Machining | PCO—Opening of the manufacturing order | 0.0400 |
Conventional milling machine setup | 0.2500 | |
Conventional milling machine: symmetric cutting | 0.9600 | |
Batch creation of 300 pieces | 0.4200 | |
Transport machining >> tribofinition | 0.0500 | |
Tribofinition | Pre-polishing | 4.1400 |
Transport tribofinition >> machining | 0.0500 | |
Machining | CNC milling machine setup | 0.2500 |
CNC milling machine: double drilling | 3.3600 | |
Quality control | 6.6600 | |
Excel—Register of information on quantities checked | 0.0300 | |
PCO—Closing of manufacturing order | 0.0100 | |
Logistics | Transport 2nd phase: machining >> tribofinition | 0.0500 |
Tribofinition | PCO—Opening of the manufacturing order | 0.0400 |
Vibration polishing | 15.1200 | |
Quality control | 0.1680 | |
Excel—Register of information on quantities checked | 0.0300 | |
PCO—Closing of manufacturing order | 0.0100 | |
Logistics | Transport 3rd phase: tribofinition >> galvanoplasty | 0.0200 |
Galvanoplasty | PCO—Opening of the manufacturing order | 0.0400 |
Assembling exhibitors | 1.7400 | |
Galvanoplasty: gold treatment | 2.0400 | |
Quality control | 6.6600 | |
Excel—Register of information on quantities checked | 0.0300 | |
Change of exhibitor | 6.0000 | |
Galvanoplasty: varnish treatment | 5.1600 | |
Quality control | 6.6600 | |
Excel—Register of information on quantities checked | 0.0300 | |
PCO—Closing of manufacturing order | 0.0100 | |
Logistics | Transport 4th phase: galvanoplasty >> assembly | 0.0700 |
Assembly | PCO—Opening of the manufacturing order | 0.0400 |
Inserting plastic filament | 0.0800 | |
Place male components on 1/2 part | 0.0800 | |
Place female components in 1/2 part | 0.0800 | |
Creating batches of 6 units/Packing preparation | 0.2400 | |
Quality control | 0.2688 | |
Excel—Register of information on quantities checked | 0.0300 | |
PCO—Closing of manufacturing order | 0.0100 | |
Logistics | Transport 5th phase: assembly >> logistics | 0.1300 |
Packaging and customer shipping | 0.4800 | |
Total flow time | 64.2368 | |
Total flow time without setups * | 63.7368 | |
Time/Piece (h) | 0.1062 |
Operational Department | Time (h) | Representation % |
---|---|---|
Logistics | 3.4500 | 5% |
Machining | 11.5300 | 18% |
Tribofinition | 19.5580 | 31% |
Galvanoplasty | 28.3700 | 45% |
Assembly | 0.8288 | 1% |
Total | 63.7368 | 100% |
Operational Department | Operation | Time (h) |
---|---|---|
Logistics | Excel—Register of information on quantities checked | 0.0300 |
Transport 1st phase: logistics >> machining | 0.1700 | |
Machining | PCO—Opening of the manufacturing order | 0.0400 |
Transport machining >> tribofinition | 0.0500 | |
Transport tribofinition >> machining | 0.0500 | |
Excel—Register of information on quantities checked | 0.0300 | |
PCO—Closing of manufacturing order | 0.0100 | |
Logistics | Transport 2nd phase: machining >> tribofinition | 0.0500 |
Tribofinition | PCO—Opening of the manufacturing order | 0.0400 |
Excel—Register of information on quantities checked | 0.0300 | |
PCO—Closing of manufacturing order | 0.0100 | |
Logistics | Transport 3rd phase: tribofinition >> galvanoplasty | 0.0200 |
Galvanoplasty | PCO—Opening of the manufacturing order | 0.0400 |
Excel—Register of information on quantities checked | 0.0300 | |
Excel—Register of information on quantities checked | 0.0300 | |
PCO—Closing of manufacturing order | 0.0100 | |
Logistics | Transport 4th phase: galvanoplasty >> assembly | 0.0700 |
Assembly | PCO—Opening of the manufacturing order | 0.0400 |
Excel—Register of information on quantities checked | 0.0300 | |
PCO—Closing of manufacturing order | 0.0100 | |
Logistics | Transport 5th phase: assembly >> logistics | 0.1300 |
Total time (h) | 0.9200 |
Operational Department | Operation | Time (h) |
---|---|---|
Logistics | Technical control reception (TCR) | 2.5000 |
PDT—Register of information on quantities checked | 0.0014 | |
Transport 1st phase: logistics >> machining | 0.1700 | |
Machining | PDT—Opening of the manufacturing orde | 0.0022 |
Conventional milling machine setup | 0.2500 | |
Conventional milling machine: symmetric cutting | 0.9600 | |
Batch creation of 300 pieces | 0.4200 | |
PDT—Batch production status register | 0.0008 | |
Transport machining >> tribofinition | 0.0500 | |
Tribofinition | Pre-polishing | 4.1400 |
PDT—Batch production status register | 0.0008 | |
Transport tribofinition >> machining | 0.0500 | |
Machining | CNC milling machine setup | 0.2500 |
CNC milling machine: double drilling | 3.3600 | |
PDT—Batch production status register | 0.0008 | |
Quality control | 6.6600 | |
Machining | PDT—Register of information on quantities checked | 0.0014 |
PDT—Closing of manufacturing order | 0.0008 | |
Logistics | Transport 2nd phase: machining >> tribofinition | 0.0500 |
Tribofinition | PDT—Opening of the manufacturing order | 0.0022 |
Vibration polishing | 15.1200 | |
Quality control | 0.1680 | |
PDT—Register of information on quantities checked | 0.0014 | |
PDT—Closing of manufacturing order | 0.0008 | |
Logistics | Transport 3rd phase: tribofinition >> galvanoplasty | 0.0200 |
Galvanoplasty | PDT—Opening of the manufacturing order | 0.0022 |
Assembling exhibitors | 1.7400 | |
PDT—Batch production status register | 0.0008 | |
Galvanoplasty: gold treatment | 2.0400 | |
Quality control | 6.6600 | |
PDT—Register of information on quantities checked | 0.0014 | |
Change of exhibitor | 6.0000 | |
PDT—Batch production status register | 0.0008 | |
Galvanoplasty: varnish treatment | 5.1600 | |
Quality control | 6.6600 | |
PDT—Register of information on quantities checked | 0.0014 | |
PDT—Closing of manufacturing order | 0.0008 | |
Logistics | Transport 4th phase: galvanoplasty >> assembly | 0.0700 |
Assembly | PDT—Opening of the manufacturing order | 0.0022 |
Inserting plastic filament | 0.0800 | |
Place male components on 1/2 part | 0.0800 | |
Place female components in 1/2 part | 0.0800 | |
PDT—Batch production status register | 0.0008 | |
Creating batches of 6 units/Packing preparation | 0.2400 | |
Quality control | 0.2688 | |
PDT—Register of information on quantities checked | 0.0014 | |
PDT—Closing of manufacturing order | 0.0008 | |
Logistics | Transport 5th phase: assembly >> logistics | 0.1300 |
Packaging and customer shipping | 0.4800 | |
Total flow time | 63.8820 | |
Total flow time without setups * | 63.3820 | |
Time/Piece (h) | 0.1056 |
Operational Department | Operation | Time (h) |
---|---|---|
Logistics | PDT—Register of information on quantities checked | 0.0014 |
Transport 1st phase: logistics >> machining | 0.1700 | |
Machining | PDT—Opening of the manufacturing order | 0.0022 |
PDT—Batch production status register | 0.0008 | |
Transport machining >> tribofinition | 0.0500 | |
PDT—Batch production status register | 0.0008 | |
Transport tribofinition >> machining | 0.0500 | |
PDT—Batch production status register | 0.0008 | |
PDT—Register of information on quantities checked | 0.0014 | |
PDT—Closing of manufacturing order | 0.0008 | |
Logistics | Transport 2nd phase: machining >> tribofinition | 0.0500 |
Tribofinition | PDT—Opening of the manufacturing order | 0.0022 |
PDT—Register of information on quantities checked | 0.0014 | |
PDT—Closing of manufacturing order | 0.0008 | |
Logistics | Transport 3rd phase: tribofinition >> galvanoplasty | 0.0200 |
Galvanoplasty | PDT—Opening of the manufacturing order | 0.0022 |
PDT—Batch production status register | 0.0008 | |
PDT—Register of information on quantities checked | 0.0014 | |
PDT—Batch production status register | 0.0008 | |
PDT—Register of information on quantities checked | 0.0014 | |
PDT—Closing of manufacturing order | 0.0008 | |
Logistics | Transport 4th phase: galvanoplasty >> assembly | 0.0700 |
Assembly | PDT—Opening of the manufacturing order | 0.0022 |
PDT—Batch production status register | 0.0008 | |
PDT—Register of information on quantities checked | 0.0014 | |
PDT—Closing of manufacturing order | 0.0008 | |
Logistics | Transport 5th phase: assembly >> logistics | 0.1300 |
Total time (h) | 0.5652 |
Financial Characteristics | Unit Value per Piece |
---|---|
Sales Price/Revenue | €19.1235/unit |
Variable cost 1 | €10.5299/unit |
Fixed cost | €4.3233/unit |
Invoicing quota | 4.0193% |
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Fortuna, G.; Gaspar, P.D. Implementation of Industrial Traceability Systems: A Case Study of a Luxury Metal Pieces Manufacturing Company. Processes 2022, 10, 2444. https://doi.org/10.3390/pr10112444
Fortuna G, Gaspar PD. Implementation of Industrial Traceability Systems: A Case Study of a Luxury Metal Pieces Manufacturing Company. Processes. 2022; 10(11):2444. https://doi.org/10.3390/pr10112444
Chicago/Turabian StyleFortuna, Guilherme, and Pedro Dinis Gaspar. 2022. "Implementation of Industrial Traceability Systems: A Case Study of a Luxury Metal Pieces Manufacturing Company" Processes 10, no. 11: 2444. https://doi.org/10.3390/pr10112444
APA StyleFortuna, G., & Gaspar, P. D. (2022). Implementation of Industrial Traceability Systems: A Case Study of a Luxury Metal Pieces Manufacturing Company. Processes, 10(11), 2444. https://doi.org/10.3390/pr10112444