Assume that Wal-Mart’s merchandise replenishment cycle is no more than 48 hrs. Below is a high-level depiction of the firm's inventory management process is seen below. The activity,'data transmitted to warehouses for invoice management' is considered a value-added part of the process as it plays a key role in reducing critical activity timelines overall, helps with eliminating non-value-adding activities which have helped the firm redesigning the process to replace it sequential with parallel processing. Assume that the activity,'Merchandise is manufactured based on historical real-time data,' takes 4 hours, and the data-driven step,' Retail link transmits data to supplier', takes up to 10 mins.Retail Link is a decision support system.It is a bridge between Wal-Mart and its suppliers.It is a website that you can visit via the Internet to retrieve the sales data, inventory data, information on its development. The flow time associated with each of the remaining steps is seen below Customer made a purchase - 15 mins Point of Sale captures data in real time - 0 mins Order's generated from previous day - 1 hour Merchandise loaded - 10 mins (Seasonal item); 30 mins (Non-Seasonal item) The warehouses have easy access to interstates and conveniently located in less-populated rural areas.The warehouses are set up for very little storage, with a quick movement of shipments from inbound trucks to outbound trucks, without storing in a facility. Seasonal merchandise can be moved from one truck to another within 10 minutes. Merchandise delivered to the store - 2:45 mins Data transmitted to warehouses for invoice management +Retail link transmits data to supplier - 10 mins Merchandise manufactured - 24 hours Store restock the shelves and merchandise shipped to warehouses - take up equal time from the leftover remaining time in the process. Remember the flow time analysis overall equals 48 hours.The warehouses are located in such a way as to cater to Wal-mart stores within a 250-mile radius. Wal-Mart is the most famous retailer implementing RFID in its supply chain management system in January 2005.Radio Frequency Identification (RFID) is an automated data collection based on an electronics – not a bar code.A tag can be embedded in the product or stuck on the exterior case or pallet.It allows for fully automated data collection with the use of portals. It required its top 100 suppliers to use RFID technology at the pallet and case level by January 2015, 200 by January 2016, 300 by January 2017, and so on… RFID Advantages - Reduce the possibility of inventory shrinkage and out-of-stock situation.Improve fulfillment rates.Improve the customer service.Reduce inventory and labor cost.Eliminate many manual processes and improve the operation efficiency.
Part 1 - What is the OEE for the above process. Hint - review the activities that are technology i.e data and or RFID driven.
Part 1. A Provide an explanation and a rationale for your scope, or in other steps selected to derive your OEE.