A stochastic simulation approach for production scheduling and investment planning in the tile industry

The present paper aims to develop a simulation tool for tile manufacturing companies. The paper shows how simulationapproach can be useful to support management decisions related to production scheduling and investment planning. Particularlythe aim is to demonstrate the importance of an information system in tile firms. The Factory Data Model (FDM) parameter isused to describe the activities in ceramic tile industries operating in different European countries. A process- based analysis oftile manufacturers is undertaken and individual company performance is quantified by Key Performance Indicators (KPI). Theoverall model is composed of different processes, which are coded into Scilab environment and matched together to arrange astochastic simulator. The simulations results are used to show how management decisions can significantly effect the KPIs. Thesimulations highlight the effects on KPIs of three specific parameters: the length of scheduling period, the quantity of stockneeded and the reliability of the information system supporting orders. The results clearly show that the effect of allowing thepresence of unattended orders within the outstanding orders list always has a remarkable negative influence on KPIs. Resultsalso suggest that the presence of sub-groups of homogeneous tiles, based on colour variation, is one of the most importantfactors affecting a tile manufacturer’s performance. The results of the simulations have two different practical implications.Firstly, they demonstrate the importance of information systems in tile companies, suggest to evaluate investment ininformation technology and indicate the value of promoting an information culture in the entire work forces. Secondly, theyshow the potential of simulation tools development to support decision making in a BPR (Business Processes Re-engineering)scenario.