Perspectives on Various Issues of Interest

Clean Technology for Armed Forces

1) In the American bases in Iraq and Afghanistan, about 40% of fuel is used to run electricity generators. Energy consumption has been reduced by coating military tents with a thick layer of commercial insulation foam, the kind used for cavity walls in homes, covered with sealant to protect it from ultraviolet light. This treatment halves the energy needed for air-conditioning and pays for itself within three to six months, depending on the price of fuel. If the various generators on a base are connected in a "smart grid" system, which optimizes their operation and distributes power to priority areas, such as communication equipments, a further 20% saving is possible.

2) A battalion of about 500 men typically produces about a ton of waste every day. A machine called Tactical Garbage to Energy Refinery (TGER) heats solid waste to produce syngas (synthetic gas, a mixture of carbon monoxide and hydrogen), ferments food slops to produce alcohol, and chemically processes the two to make biodiesel that powers a generator. TGER produces as much as 64 kilowatts of power - enough to run the command post of a battalion.

3) By 2016 the American air force seeks to use a 50:50 blend of synthetic and ordinary jet fuel for half of its aviation requirements. 

4) The American navy has tested a biofuel made from the camelina plant in its F-18 Hornet jet. Later the biofuels will be tested for ship turbines. It is also installing stern flaps on its amphibious vehicles that can reduce fuel use by 2-3% and developing better coatings to prevent the growth of algae and barnacles on hulls that cause drag and increase fuel consumption. In October 2009, the USS Makin Island, an amphibious assault ship, was the first of 12 hybrid-powered ships to take to the water. It saved nearly $2 million in fuel costs on its maiden voyage alone.

Source: "Greenery on the march." The Economist, December 12th 2009.

Changes in Power Adaptor Technology is Saving $2 billion Worth of Electricity

Until recently the power adaptors were made using copper wires. About half the power they drew from the wall, and sometimes as much as 80 percent would be lost in conversion. As a result, electricity bills and carbon emissions were both higher that necessary. Making the conversion of high-voltage alternating current to low-voltage direct current using integrated circuits is much more efficient, with as little as 20 percent of the power being lost. The technology, although available for several years, cost around 30 percent more making it less attractive for manufacturers to switch. Further, power adaptors cost very less (about $2 or less) and most the production contracts to manufacturers in Taiwan and China were negotiated and determined on the basis of the manufacturer's ability to reduce the selling price by a few cents a piece. Consumers also do not give as much attention to power adaptors in their phone or laptop purchase decisions. All these factors limited manufacturers' incentives to switch to energy efficient technologies.  

Around seven years ago, the Natural Resources Defense Council and Ecos Consulting, an energy consultancy, got manufacturers, power utilities and the state and federal governments together to talk about shifting to integrated circuits. It took two years to get regulations in place in America. With the biggest market adopting to the new technology, integrated circuit adaptors spread swiftly everywhere. For consumers the switch has meant lower power bills and smaller, lighter power adaptors. For the world as a whole it has meant a drop in global power consumption worth around $ 2 billion a years - saving $13 million tonnes of carbon dioxide annually worldwide, the equivalent of closing down eight coal-fired power stations.

Source: Vampires on a diet: How a boring gadget saved $2 billion-worth electricity. The Economist, A Special Report on the Carbon Economy, December 5th 2009

Incorporating Supply Chain Principles in Relief Operations

Disaster relief failures emanate due to supply chain glitches. The activities of Association of Logistics Aid Network (ALAN) present an example of humanitarian relief efforts that use supply chain principles. ALAN represents supply chain professionals with the ability to provide adequate resources in response to disasters. One of the most significant contribution to disaster relief that ALAN leaders have made occurred after Hurricane Gustav in Fall 2008. The organization set up a portal that allowed relief agencies to submit needs (e.g. hospital beds, wheelchairs) that could be visible to people in the supply chain. The supply organizations were able to see these needs and respond appropriately. For example, leaders at Invacare Corporation, a global manufacturer and distributor of medical products, saw the needs on the portal and provided their products to the victims immediately. Another example is the effort by Dr. Sameer Prasad in creating and applying a supply chain model to streamline the process of providing food and medication to poverty-stricken children in Andhra Pradesh, India. With the assistance of spreadindia.org and with funding from ISDUSA.org in 2008, Dr. Prasad and team have set up a safe haven for children by combining the supply chain streams into a single point of delivery. 37 boys are in care shelter and the performance of the refined supply chain is measured by means of health-care specific improvement of these children in the shelter. An interesting offshoot of this initiative is that these children also started to perform better on education front. Several children who weren't going to school, now are doing so, and moreover, with the availability of food and health-care, they school grades have also shown improvements. 

Source: Ostby, I. 2009. Supply chain for the greater good - Operations management without borders. APICS Magazine, September/October 2009.

Can Six Sigma efficiency programs result in jobless recovery?

In an article published in BusinessWeek the above question is examined. The enhanced interest in deploying Six Sigma initiatives is widely observed in several industries. Firms are trying to radically reduce production defects and improve processes, without necessarily putting more people on the payroll. The article states that:

- Capital One has launched a Six Sigma initiative to "drive continuous improvement" in its operations.

- Pfizer has embarked on 85 Six Sigma projects to lower the cost of delivering medicines to patients in its pharmaceutical sciences division.

- Chicago law firm Seyfarth Shaw is using Six Sigma to make client meetings more productive.

- Ads seeking Six Sigma experts and "black belts" increased to 7,155 in August 2009 from 6,585 in June 2009.

Source: Burnsed, B. and Thornton, E. 2009. The Six Sigma Black Belts are Back. BusinessWeek, September, 2009.

Component Profiles and Replenishment Methodologies

The five replenishment methods and their ideal component profiles:

1) Material Requirement Planning (MRP): Set of techniques that use bill of material information, inventory data, and the master production schedule (MPS) to calculate the requirements for materials.

a) Primary element: certainty of demand - In MRP replenishment method the MPS is used to drive MRP. The methodology works best when there is some level of certainty of demand.

b) Secondary element: lead time - Lead time does not play such an important role since inventory is typically used shortly after it is received regardless of the length of lead time. 

c) Secondary element: component cost - The component cost does not impact the effectiveness of MRP.

d) Secondary element: usage - MRP is equally applicable for high-volume or low-volume components.

e) Secondary element: linearity of demand - MRP is not affected by linearity of demand.

2) Broadcast: In this methodology demand requirements are communicated via electronic signals sent directly to the manufacturing area of supplier production planning and scheduling systems. The parts are then made available just prior to the time they are needed.

a) Primary element: certainty of demand - When a requirement is signaled, there must be complete assurance that the item really is needed.

b) Primary element: lead time - The methodology requires a low lead time since no inventory is carried.

c) Primary element: component cost - The methodology is more applicable for expensive items.

d) Primary element: usage - The methodology is most applicable for high usage items.

e) Primary element: linearity of demand - Items must have a smooth demand pattern for effective use of the broadcast methodology.

3) Kanban:  A pull system involving signals to effectively manage flow of parts between work centers.

a) Primary element: certainty of demand - A reasonably high level of certainty of demand is required for the effectiveness of the methodology.

b) Primary element: lead time - The methodology is more applicable for low lead time items.

c) Primary element: component cost - High component cost enhances the effectiveness of kanban.

d) Primary element: usage - Kanban requires reasonably high usage rate.

e) Primary element: linearity of demand - Kanban works best when demand is reasonably smooth.

4) Vendor Managed Inventory (VMI): In this methodology the supplier determines the quantities to be maintained at its customer sites and frequently monitors inventory levels.

a) Secondary element: certainty of demand - This is the only methodology that can deal with low level of demand certainty.

b) Primary element: lead time - The methodology works best when lead times are low.

c) Primary element: component cost - Component costs should be low when using VMI, since then the supplier can keep ample quantities of safety stock to handle demand uncertainties and replenish as and when needed.

d) Primary element: usage - The methodology is most applicable for high usage items.

e) Secondary element: linearity of demand - Demand for VMI items is typically smooth due to high degree of commonality.

Source: Louis, R. S. 2009. Precision inventory - Effective replenishment through component profiling. APICS Magazine, September/October 2009.