Improving the performance of a Malaysian pharmaceutical warehouse supply chain by integrating value stream mapping and discrete event simulation

Abstract

Purpose Lean implementation is vastly incorporated in core manufacturing processes; however, its applicability in the supply chain and service industry is still in its infancy. To acquire performance excellence and thrive in the global competitive market, many firms are adopting newer methodologies. But, there is a stringent need for production simulation systems to analyze supply chains both inbound and outbound. The era of face validation is slowly disappearing. Lean tools and procedures that provide future state assumptions need advanced tools and techniques to measure, quantify, analyze and validate them. The purpose of this study is to enable dynamic quantification and visualization of the future state of a warehouse supply chain value stream map using discrete event simulation (DES) technique. Design/methodology/approach This study aimed to apply an integrated approach of the value stream mapping (VSM) and DES in a Malaysian pharmaceutical production warehouse. The main focus is diverted towards reducing the warehouse supply chain lead time by initially constructing a supply chain value stream map (both present state and future state) and integrating its data in a DES modelling and simulation software to dynamically visualize the changes in future state value stream map. Findings The DES simulation was able to mimic the future state lead time reductions successfully, which assists in better decision-making. Improvements were seen related to total lead time, process time, value and non-value-added percentage. Warehouse performance metrics such as receiving, put away and storage rates were substantially improved along with pallet processing time, worker and forklift throughput usage percentage. Detailed findings are clearly stated at the end of this paper. Research limitations/implications This study is limited to the warehouse environment and further additional process models and functional upgrades in the DES software systems are very much needed to directly visualize and quantify all the possible Lean assumptions such as radio frequency image identification/Andon (Jidoka), 5S, Kanban, Just-In-Time and Heijunka. However, DES has a leading edge in extracting dynamic characteristics out of a static VSM timeline and capture details on discrete events precisely by picturizing facility modification and lead time related to it. Practical implications This paper includes all the fundamental pharmaceutical warehouse supply chain processes and the simulations of the future state VSM in a real-life context by successfully reducing supply chain lead time and allowing managers in inculcating near-optimal decision-making, controlling and coordinating warehouse supply chain activities as a whole. Social implications This integrated approach of DES and VSM can involve managers and top management to support the adoption of anticipated changes. This study also has the potential to engage practitioners, researchers and decision-makers in the warehouse industry. Originality/value This study involves a powerful DES software package that can mimic the real situation as a virtual simulation and all the data and model building are based on a real warehouse scenario in the pharmaceutical industry.

The State of Cold Logistics Supply Chain in a Developing Asian Country - A Preliminary Insights

“…This study found that LSP's attraction to offers CLSC is generated from positive income due to the lower number of providers and level of competition (Tan & Li, 2018), derived from the e-commerce phenomenon were forcing the traditional retailers to closed down their stores and that vacant location is replaced with the F&B retailers (Zhang et al, 2016), changes in consumer's habits like increasing for the consumption of frozen food and ready to-eat-meal which sees the used for more CLSC to delivers these products to retail stores (Al Theeb et al, 2020;Khan & Ali, 2021), demand from customers, organisation readiness, and government regulation. In the future, it is expected that the demand will increase mainly derived from the halal and pharmaceutical sectors (Abideen & Mohamad, 2020;Abideen & Mohamad, 2019;Khan et al, 2019;Rahman et al, 2018). For the time being, the market competition is modest as the LSPs need to be ready for their capital investments, ability to invest in cold chain assets and related certifications for increasing the competitiveness level which seems too high for smaller companies.…”

“…The study reported that keeping milk in clean containers at refrigerated temperatures immediately after the milking process might delay the onset of initial microbial load and prevent the multiplication of micro-organisms, specifically between milking at the farm and transportation to the processing plant. Demand from the pharmaceutical sectors also vital in Malaysia, where some of the raw materials used need cold storage and special attention immediately (Abideen & Mohamad, 2020;Abideen & Mohamad, 2019).…”

Lean simulations in production and operations management – a systematic literature review and bibliometric analysis

“…This framework also indicates that the present simulation software tools must inculcate direct parametric variables that could quantify a lean tool or a lean procedure empirically in terms of simulated graphs. A separate window panel for inserting the desired performance metrics or lean benchmarks covering the scope of the given system under study is an absolute necessity (Abideen and Mohamad, 2020).…”

“…Simulation is a best-suited complementary tool for integrating with value stream mapping (VSM) technique (Abideen and Mohamad, 2020). It enables us to visualize a production line under excessive stocks and buffers and simple concept such as first-in-first-out can be applied to avoid bottlenecks.…”

“…Various simulation techniques such as spreadsheet simulation, system dynamics (SD), discrete event simulation (DES) and business games were invented to answer the managerial questions posted by different problems (Kleijnen, 2005). These tools are capable of assisting in creating a digital factory for various production operations (Abideen and Mohamad, 2020). Furthermore, the product and process planning for different levels of production seem to be easily optimized to great extent by discrete event modelling and simulation technique that can portray three-dimensional motion visuals for virtual models and interestingly a dynamic simulation that displays output variations over a defined timeline (Kuhn, 2006).…”