Good things come to those who Improve at Diageo

The Lanner Group helps Diageo to simulate glass and can lines

Background

Diageo is the UK’s leading drinks company; its widget technology is world leading. As well as packaging its world famous stout, the facilities at Runcorn and Belfast provide a service to the other major breweries. In total some 150+ different products are packaged, in several different pack formats requiring unique routing along the pack lines. With the resulting scheduling complexities and delivery expectations, responding to the challenge of performance improvement requires fresh thinking and innovation.

In today’s beverage market the ability to seize opportunities is critical. The demands placed by both consumers and retailers necessitate an approach that is both agile and efficient. These demands make it more difficult to sustain high levels of performance let alone identify opportunities for step change. In the pursuit of best practice Diageo turned to Lanner Group to understand what simulation modelling could do for its packaging business.

Simulation modelling involves creating a computer model to mimic the behaviour of a real process. Animation shows the movement of product between processes and queues thereby providing a mechanism to visualise processes and effects of making changes ahead of time. In addition to the animation, the model continually collects performance information.

The technique of simulation modelling provides the means to quantify performance to provide decision-makers with an understanding of the benefits/consequences of committing to a change. This permits a manager to investigate how best to improve efficiency by changing any number of parameters in a risk free environment so that the benefits and consequences of making changes are known prior to implementation. Projects frequently support business cases for change where a project is used as a vehicle to demonstrate the benefits of the changes involved.

Lanner Group recommended building a generic simulation model that is readily configurable to represent the different production lines at each of Diageo’s packaging businesses. Time was invested up front to determine the correct scope and level of detail. This ensured that the model was kept sufficiently high level to aid usability, without compromising the accuracy of the representation. Effort was also invested to ensure that the solution could be applied to all packaging lines within the business, with the minimum level of training.

The resultant model provides the ability to simulate glass and can lines. The glass lines can be fed from both returnables and non-returnables. The scope of the model allows up to three packaging lines to be investigated concurrently. This also supports “cross-overs” for when product groups need to make use of equipment that is shared between lines. The model supports a fully flexible network of equipment; the user constrains this to remove equipment and paths that are not supported at their site. The remaining equipment is then detailed to provide data on speeds, sensor positions, planned and unplanned stoppages, mechanical changeovers and crewing. Once product data has been specified, encompassing routes, liquid changeover times and physical dimensions the model is then run forward with a production schedule to ascertain how the facility performs.

The model reports all aspects of performance. These include

• Product run duration and batch performance
• Minute by minute analysis of all causes of losses
• Utilisation of all equipment
• Utilisation of conveyors (i.e. accumulation used)
• Operator utilisation (by skill level and type)
• Production target adherence
• 6 loss analysis

In order to ensure that the model was accurate, it was configured to the existing facilities in Belfast and Runcorn. This allows the behaviour of the model to be validated and provides the basis for a comparative analysis of the changes under consideration. A number of experiments were then performed, each one capitalising on, or discarding the findings from previous “What-ifs”. The model has been deployed on many projects to assess the impact of change prior to the commencement of any engineering work.

Results

The resulting benefits realised within the first 3 months include

• The model demonstrated that a line could perform at 80% efficiency if minor stoppages in two particular areas were targeted. Focus on the identified issues enabled 80% efficiency (the best ever) to be achieved.
• Capital cost avoidance of £80k when an additional accumulation option offered insufficient increase in performance.
• Cost justification for an additional £400k Shrink-wrapper, the model demonstrated the real benefit offered during changeover and run-up.
• Multi-million cost saving by realising that the installing a mid-line buffer would have little benefit.

Substantial cost savings can be achieved; both through capital cost avoidance (or optimised capital investment) and reduced operating cost. The true worth of the technique is now recognised with Diageo; it has enabled much better buy-in to plant changes. This has instigated a new policy: “All future line configuration changes will not be sanctioned until their real benefit has been simulated.” - Jimmy Hall - World Class Manufacturing Manager.

Further benefits include

• Optimisation of scheduling rules
• Realistic setting of daily targets based on a weekly schedule
• Skill level and resource optimisation
• Proposed new products/systems/rules can be ‘stress tested’ in a wide variety of conditions, greatly reducing the risk inherent in change
• Operating practices and assumptions can be challenged to understand how to get the best use out of existing assets

Armed with this tool, Diageo are now investigating how further performance improvement can be realised across all of the packaging sites. Doug Nicholls, Diageo’s technical director, who introduced this innovative technique, is delighted with the initial results and is instigating further simulation modelling work within the group. He openly states “This is one of the best investments we have ever made”.