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In many consumer markets lead-time is no longer the outcome of a process of planning, producing and delivery. Many companies have gained competitive advantage through shortening the lead-time. In achieving this, next to the introduction of more flexibility in their own operations, companies are looking for more flexible suppliers. Traditionally uncertainty in supply was mitigated through high inventories. Next to the costs involved in keeping these inventories, they also delay the demand information and thereby create volatility, called the bullwhip effect. That is why various industries have put efforts in lowering the inventories and increasing flexibility. Introducing flexibility in production is rather controversial in the chemicals industry. Economies of scale and low margins nurture the emphasis on plant utilization. This drives ever lower margins, hence an even higher emphasis on plant utilization. The 24-hour operation leaves no flexibility to respond to a changing demand or to compensate for downtime. The company that initiated this research and offered the facilities to perform a desk study and provided the data to build a simulation model is active in the chemicals industry. During the recession of 2008 the company was confronted with a decrease in demand. In 2010 a quick recovery of the market was experienced, accompanied with several assets failing this caused large disruptions in the supply to customers. The reliability of supply was perceived too low at the commercial interface. This made the company look for ways to improve the customer-perceived value of supply. In this report a strategic audit is proposed. The objective of this audit is to align the company’s competitive strategy and operations strategy. The competitive strategy considers the market the company is active in and its value proposition to its customers. In this research this was done though the Industry Trends Analysis and the Customer Value Analysis. The market view was applied, which starts at the market and ends in recommendations for the operations. This audit structured the answering of the following research question: How can chemicals companies delivering to intermediate markets, improve the customer-perceived value of the supply in a cost-effective way? Increasing volatility in the demand on consumer markets makes that requirements of the industries downstream of the chemicals industry include the responsiveness to this volatile demand. As a consequence this also influences the customer-perceived value of the manufacturer’s supply. The commoditization in the downstream markets increases the need for agile operations and make that customers focus more on service-aspects like lead-times. Through a structured survey customers were asked to indicate the importance of, and performances on, supply chain related aspects. These aspects were based on the four guiding principles for supply chain managers: responsiveness, reliability, resilience and relationships and the three of the four elements of customer value: quality, service and timing (cost was excluded to prevent strategic answers). Besides a confirmation of some characteristics of the industry like the low importance of customized solutions and the high emphasis on quality the survey also resulted in new insights. The results especially represent the CASE customers, a segment in which the company wants to grow and where customers on average are smaller and deliver to industries where just-in-time practices are more common. In contrast with Flexibles customers these customers value responsiveness more than reliability. Reliability was valued high and performances where rated high. For responsiveness the importance was indicated to be high, while the performances where rated amongst the lowest. The challenge for the company will be to become less dependent on forecasts and increase the agility of operations while sustaining the current level of reliability. As part of the strategic audit, the competency gap was specified by defining key performance indicators that the company should improve. The objective of the system should be to limit the lead-times, achieve a high order fulfilment rate and keep appropriate inventory levels. The company currently applies a hybrid form of make-to-order (MTO) and make-to-stock (MTS) operations regime. The regime is based on forecasts that are facilitated by the monthly repeated S&OP process. The focus is in the first place on optimizing production, which leads to varying availability of products and a long planning horizon. The delay in information between the complex production chain and demand management makes that inventory levels vary a lot and consequentially order fulfilment is compromised. It is advised to implement the just-in-time (JIT) regime. This regime has the prospect of shorter lead-times, more stable inventory levels which lead to less variation in product availability and thereby increases order fulfilment. The only downside is that this compromises the production capacity used on short term as this is adaptive to the demand, which is counter intuitive regarding the current KPI’s which focus on the occupancy of assets. The prospect is that production capacity is only used for producing the right products at the right time and higher sales margins due to more stable operations. The production processes and assets were successfully represented in a simulation model, which delivered valuable insights for the industry. The chemicals industry is characterized by a bill of materials that decomposes a few raw materials into many finished products. This makes that the chemicals industry has one of the most complex production chains. In this thesis an object oriented representation of the system was proposed. The relations between objects describe the bill of materials, thereby enabling the simulation of the complex production chain. Experiments based on the sales of 2010 and disruptions based on historical data from 2005 to 2011 excluding the force-majeure situations showed that the JIT regime is successful in fulfilling the orders with short lead times and low inventory levels. It is important to note that the sales represent a managed demand. Due to the inflexible capacity this managed demand is considered an important requirement for the system to work. Next to an improved order fulfilment, the model showed that JIT allows lower inventory levels. Finally JIT makes the impact of disruptions more predictable, which enables the company to develop calculated responses to these situations.

This research focuses on cost reduction in the logistical system of the Engine Shop of the KLM. This logistical system is complex of nature and involves very high material costs. The research emphasises on inventory cost reductions. A comprehensive system analysis has been performed that gives insights in the logistical processes of the Engine shop. A data analysis has been executed to evaluate the logistical performance of the engine shop and helped to derive to the root of problems. This report suggests five alternatives that can jointly result in a significant reduction in capital employed in the engine shop’s inventories. The alternatives give suggestions for improvements that require almost no investments nor structural changes, which facilitates acceptation and eases implementation. The research can give insights, also for third parties, in how cost savings can be obtained in the field of inventory control in a high tech MRO (Maintenance, Repair and Overhaul) shop.

The Dutch youth care sector defends and supports children in their maturing process. Over last decades this complex and heavily resource bound health care system faced long waiting lists and over utilized resources. Various policies based on increasing budgets and care capacities did not result in the expected structural waiting list decreases. Youth care authorities and care providers require decision support models to oversee the consequences of their mutual capacity decisions. In this research we practically evaluate the insights a stochastic Discrete Event Simulation model provides, in addition to the currently used deterministic System Dynamic model, when parameterized with data of a real world care provider over 2008 and 2009.

A powerful combination of simulation and optimization has been successfully applied to solve real-world decision making problems (Fu et al., 2000; Fu, Glover, & April, 2005). Unfortunately, there are scientific and application problems with this method. Firstly, there is no transparent and formal structure to define the integration between simulation and optimization. Secondly, there are challenges to ensure a proper balance between the various desired features of the simulation-based optimization method (i.e. generality, efficiency, high-dimensionality and transparency)(Fu, 2002). This research provides two contributions to the problems above by providing: 1) the design of the framework that addresses the knowledge gap above; 2) the implementation of the framework that fulfills the aforementioned features in Java. The proposed framework is developed based on Zeigler’s modeling and simulation framework and the phases of an optimization study in operations research. The test and evaluation show that the desired features are successfully satisfied.

A well designed public transportation system can provide convenience to the public, increase the profit of the transportation company, and reduce the cost to the society as a whole. The depot is an important part in the study of transportation systems. The choice of the capacity of the depots is a strategic decision. It will constrain the possible tactical decisions (such as vehicle planning) for a long time, due to the life-span of the infrastructure. It is therefore important to study the impact of the options before they are implemented. The transportation company now is facing the problem that there is no appropriate tool in the decision support system to assess the capacity of the depots and the vehicle planning on the deadhead-kilometer (non-value added trips) and the robustess of the service. The simulation model is an appropriate method for the main part of the study. It can be used to evaluate the key performance indicators of deadhead-kilometer and average delay time, to study the complex interactions among the different elements, and to improve the understanding of the behaviors of the transportation system. The simulation model is useful for evaluating both strategic decisions and tactical decisions. The analyzing tool is designed following the methodology of systems engineering. First the requirements were gathered and translated into specification. The design was then conducted to fulfill the requirements on the conceptual level. Specification of the key classes were then concluded from their functionalities and relationships. The detail design came out with detailed attributions and methods of the classes. The analysis is based on a part of the network which consists of five service lines. According to the analysis, compared to the current design (Scheveningen, Zichtenburg and Lijsterbes), the future alternative with “Remise Zuid” depot and closing down “Lijsterbes” depot achieves 18% reduction on average delay time, but with a cost of 15% of increase in deadhead-kilometer. With the ratings obtained from the policy advisors of HTM, the alternative with “Remise Zuid” outperforms the design of current situation on the overall performance. Though the methodology applies to the entire network, the analysis results so far portaits the impact on these five lines. A more comprehensive study can be conducted with the same method and the input data covering all the operating lines. Some improvement can be made on the management of depots by a better the training of the employees and a clearer definition of job responsibilities.

Business process simulation (BPS) provides the possibility to simulate and evaluate the dynamic behavior of business processes, without directly influencing or changing the processes. The main problem is that developing a simulation model is considered to be difficult, time-consuming and expensive. For management consulting companies, BPS could be a useful addition to their current practices. As BPS requires advanced skills to develop a simulation model, a new approach is however required to enable business process simulation by management consultants. A user-centered design approach is applied to increase the likelihood that a designed solution is finally found useful and usable by the management consultants. The new designed approach for modeling and simulation of business processes, is based on Model-Driven Development (MDD) principles. Furthermore, we defined a conceptual modeling language based on the Business Process Modeling Notation (BPMN) and we adapted it to connect with the consultant's mental model. For each modeling element, a corresponding DEVS-simulation component is defined. To support the transformation from conceptual model to simulation model, a set of model-transformation rules is defined. And finally, several output statistics are specified, related to for instance resource utilization and processing times of entities in a business process. As a proof of concept, a prototype is developed based on the MDD4MS framework. It includes a visual model builder, a set of formally defined model-transformation rules, and the simulation components implemented in Java programming language. The Distributed Simulation Object Library (DSOL) was selected to provide the simulation and execution functionalities of the prototype. The prototype is finally used to model and simulate a sample-case, as well as a usability evaluation with management consultants. We conclude that the proposed design is a fruitful possibility to enable business process simulation by management consultants.

Market pressure for cost-efficiency is forcing, and the implementation of XBRL is enabling, accounting firms to optimize their business processes to become more cost-efficient. While the manufacturing industry has benefited much from available BPM methodology for becoming more agile, leaner, cost-effective and customer-focused, it is still unsure how BPM should be applied in the services industry and especially in knowledge-intensive organizations for benefiting from digitalization and standardization. A case study research is performed to investigate how, and which, BPM principles can best be applied for the utilizing digitalization and standardization in knowledge-intensive organizations in the financial services industry. The case study research entails a process analysis, simulation and improvement of a business process from an accounting firm. The research suggests that existing BPR principles and Lean Management offer concrete support for improving these types of business processes using XBRL, but that it is difficult to quantitatively validate these improvements. To improve the possibilities for adequate quantitative validation of process improvements, future research should be focused upon identifying measurable indicators for the efficiency and quality of knowledge-intensive business processes (in the financial services industry).

Due to rising costs and an increasing demand for health care services Dutch hospitals are looking for ways to reduce costs while maintaining or increasing the level of patient satisfaction. Reducing variation in bed occupation in common nursing wards could save costs by reducing the amount of required beds and nurse staffing, and increase quality of care by stabilizing the nurse workload. Adjusting current OR schedules offers potential to reduce variation because they have often been developed without explicit consideration for the wards due to the uncertain relationship between them. The main research question is therefor ’How can the management of Dutch hospitals implement adjustments to the operating room schedule in order to reduce the variability of bed occupancy in the patient wards?’. The variability in bed occupation can be seen over years, weeks and days. The weekly variation can be influenced by making adjustments to the master surgical schedule (MSS), a repetitive two weekly schedule that assigns all avail- able OR blocks to a surgical specialism. An OR block is a morning or afternoon session in a certain OR on a certain day. Analysis has shown that for the Sophia hospital, which is used as a case study in this research, only 16% of total admis- sions should be considered because they can be directly influenced by adjusting MSS. Research has shown this group exhibits the most variation. Swapping OR blocks in the MSS is difficult because analysis revealed the MSS was not as repetitive as thought and differed slightly each cycle due to for example specialisms trading or cancelling blocks. To solve this the MSS was reconstructed using historical data over an entire year to find for each block which surgical specialism has used the block the most cycles for elective surgeries. The resulting reconstructed MSS represents the structural influence the MSS has had over that year. This reconstructed MSS can be adjusted by swapping MSS blocks in order to reduce the structural bi-weekly variation caused by the MSS. This variation can be seen in wards, specialism clusters, wings and the entire hospital. This research will focus on making adjustments to the structural master surgical schedule that reduces bi-weekly variation in common wards per surgical specialism cluster. Current literature has a low rate of implementation because the influence of stakeholders is often disregarded, and rarely sees the MSS as a tool to level ward occupancies. Optimization approaches are limited because an optimal MSS is an unobtainable objective given the variety of objectives of stakeholders. This thesis presents a visualization allowing non-technical users to identify beneficial MSS block swaps between blocks from within a single surgical specialism cluster. A decision support tool (DSS) allows stakeholders to quickly evaluate the effect of those swaps on variability in their bed occupation in nursing wards. The DSS does this by adapting an implementation of the mathematical model from van Berkel that is able to relate the master surgical ward to the occupation in the nursing wards. The DSS is able to predict the effect of the structural MSS accurately enough to evaluate changes in structural variation patterns caused by MSS block swaps. Experimentation has shown the method is able to identify a potential reduction in peak occupation by several beds for both the neurosurgery- and common surgery cluster in Isala. Another observation was that an unequal division of MSS blocks over the week caused peaks in occupation that could not be compensated with MSS block swaps. This led to the suggestion of a multi- stage approach to bed leveling through the MSS, where the division over the week of MSS blocks from a specialism cluster or hospital wing is equalized as much as possible. MSS block swaps can then be done between clusters or wings (discussed in appendix D.1), after which swaps within clusters or wings can be applied. The developed decision support tool helps stakeholders with this last step and enables specialisms to find beneficial swaps themselves. The research is supplemented with a process design that addresses how to use and embed research efforts in a hospital environment with a strong influence of stakeholders with conflicting interests. The decision support tool can benefit a hospital looking to realise a certain reduction in peak bed occupancy in order to reduce the amount of beds. The DSS can also support a sustainable process solution with incremental adjustments to the MSS, in order to allow hospital to consider ward occupation when adjusting the MSS. This thesis has not answered the entire scope of the main research ques- tion but has identified a range of possible measures, intervention levels and a multi-stage approach to bed leveling. The method provides practical means to reduce bi-weekly variation in Dutch common nursing wards through the master surgical schedule while accounting for the influence of stakeholders. The results have yielded valuable insights for Isala, where the research will be applied and developed further. Bed leveling is not only an important issue in Isala but also becoming increasingly important in other Dutch hospitals looking to better uti- lize their expensive resources. This research has contributed to the academic field with a unique non-optimization approach to adjusting the MSS in order to reduce variation in bed occupation. Contrary to other research the method takes into account the influence of stakeholders by enabling stakeholder inter- action to find adjustments to the MSS. In conclusion, the developed method might benefit the rapidly evolving Dutch health care sector that is pressured to improve its cost-effectiveness.

The projects in oil and chemical (O&C) industry often experience problems during their execution, because of those problems, some of the project ends with large cost and schedule overruns. The poor performance of projects not only affects the strategic objective of project’s owner but also poses a dual threat to engineering and construction (E&C) companies. They negatively affect their profit margins and their business objectives. Given the strict budget constraints imposed by the present global economic situation, owners and stakeholders expect their projects to be delivered cost effectively and efficiently. Therefore, it is important for E&C companies to strive for improvement in their project management practices. The current thesis research is a step in direction to introduce a new concept for improvement in performance management practices. For that purpose, the research introduces “early detection of project problems” as the main instrument and uses the quantitative information from past project to develop a body of knowledge and first conceptual model to predict the future performance of projects at their early stages. The research is conducted in five phases, the first phase of the research explores O&C project and their performance management practices. Based on the gathered knowledge via literature study and available information, the main research question is formulated as “How can future problems and performance of a current O&C project be predicted at early stages using knowledge and experience from past projects in an EPC environment?” Thereafter, a series of sub questions were formulated aimed to answer the above-mentioned research question. The later part of the first phase developed a structured research approach and research methods. In the second part of the research, efforts were directed to find the so-called “early warnings” of problems. To identify the early warnings, two main sources were explored, literature and experts from O&C project industry. Each investigation into respective sources resulted into number of early warnings. Each identified early warning was evaluated on selection criteria with three selection parameters. After the careful evaluation, the following ten early warnings were selected. ID Early warning indicator LES Lack of understanding of project execution strategy among project team PTE Project team lacks experience required for the project COC Conflicts between owner and E&C contractor NCO Numbers of change orders CCO Cost impact of changes FED Percentage of missing information in FEED package PH Growth in process man-hours PS Delay in process engineering CE Change in concurrency level between process and piping engineering DPO Delay in issuance of purchase orders The selected early warnings were carried to the third phase of the research, in which four detailed case studies were performed to have observatory evidence. The case studies in this phase consisted of four project with different performance levels. The difference in performance levels of case projects set the contrast in which the predictive capability of early warnings could be observed. The case study investigation found that there is a relationship between early warnings, project problems and project performance. After obtaining the observatory evidence, the fourth phase of the research adopted a purely quantitative approach and studied the behavior of early warnings in a relatively larger set of past projects. Subsequently correlation analysis was performed to find correlations between early warnings and final project outcomes (which collectively asses the project performance). The quantitative analysis did present interesting and encouraging results. The main results are mentioned as follows: I. Early warnings do behave differently in case of poor and good performance projects, few in terms of their absolute value and few in their incremental changes. II. Correlations do exist between EWI and project outcomes, however not all the EWI found to be correlated with all project outcomes. III. The EWI indicators does show a dynamic quantitative relationship with project outcomes over engineering duration of the project Using the results from quantitative analysis, an attempt is made in the last phase of this research for the development of prediction model, which can predict the future performance of projects. The results of pilot prediction model were analyzed and compared with forecasts made via traditional forecasting methods. The comparison of forecasts found that prediction model does make prediction that is more accurate. However, there are errors with-in prediction models. In addition, the external validation of model suggested limited reliability and accuracy of pilot model. The dataset used for quantitative analysis and building of prediction model is relatively small and limit the generalization of findings. Therefore, to have a more accurate prediction in good projects, a dataset is required which contains a balance of Successful and less than successful performance projects. Despite the smaller dataset, the findings and approaches presented in this research can be used to build a useful model and subsequently applied in O&C project industry. A set of insights and recommendations (short term and long term) has been made for Fluor to implement the findings of this research to develop an operational performance prediction system. The research possibly has following main contributions to scientific and industry. Contribution to scientific community I. A shift from reactive project management to proactive project management II. A new and constructive role of past projects Contribution to O&C project industry I. An approach, which facilitate the early detection of future potential problems II. An approach to capitalize on past projects to improve project performance management

Transport collaboration has been applied in many different industries both on vertical and horizontal level; to improve transport performance and reduce transport costs. In the air cargo industry currently limited transport collaboration exists both on horizontal and vertical level for inner airport transport of freight forwarding companies. High growth rates and healthy operating margins had limited the need for extensive collaboration in the past. However due to changing dynamics of air cargo transport use and type of shipments that are transported at major established airport in Western Europe, like Schiphol airport, there is an increased focus on cost reductions and improved transport performance. Therefore horizontal transport collaboration could be applied to improve the transport performance and costs for air cargo freight forwarders active at major airports. This research has tried to reveal the potential and main challenges of applying horizontal transport collaboration at Schiphol airport for air cargo shipments. This research has combined both qualitative and qualitative methods to support the potential of horizontal transport collaboration within a large air cargo system, by combining analyses on different major cargo airports with both a case study simulation model and system analysis on specific shipment collaboration at Schiphol as a whole. The results of this study indicate that for many freight forwarding companies, supporting horizontal transport collaboration could significantly improve transport costs and performance. However in order realize the potential benefits of horizontal transport collaboration; companies will have to transport shipments on regular basis that are suitable for transport collaboration. Also forwarding companies will have to be much more flexible and adaptive, regarding the use of different types of transport and the way shipments are collected/delivered, in order to make horizontal transport successful based on costs and performance. With the expected lower growth rates of air cargo and more dynamic transport of air cargo shipments with lower operating margins at major established airports in Western Europe, horizontal transport collaboration is also expected to be effective approach for coming decades. Given the existing overcapacity at most air cargo handlers at different airports and the reluctance of air cargo handlers to invest in more automated systems, due to uncertainty about air cargo growth. Besides this supporting horizontal transport collaboration can also improve the relationships with air cargo handlers, forwarders and transport companies, which can make part of the air cargo transport more stable and effective. It can give the air cargo handler and forwarder the ability to offer different transport concepts to their customers. However to truly realize the full potential of horizontal transport collaboration, the use of horizontal transport has to be frequently assessed and improved, due to changing shipment dynamics of the involved companies. Next to this the remaining single company transport use should also be adapted as well on regular basis, in order to improve the transport costs and performance of the complete transport system. Not all forwarding companies active at a major airport, will be willing or able to support either horizontal or vertical transport collaboration, therefore it is advised to assess the possibility for all air cargo handlers individually, at major airports, to apply segmentation on transport collaboration. This segmentation should be assessed regarding potential and the ability of companies to collaborate within a specific transport flow, between the warehouses of two or more companies. This means that both forwarders and air cargo handlers should support vertical and horizontal transport collaboration when it results in; higher benefits for their own organization, for the other involved stakeholders and all companies are able to effectively support the intended collaboration.