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New Product: Factory Physics software suite handles supply chain changes

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Factory PhysicsProduct Briefing Outline: Factory Physics Inc., a management consulting company, has launched its proprietary software application ‘LeanPhysics' Support Tools. LeanPhysics Support Tools enable enterprises to apply ‘Factory Physics' principles and optimize design, planning and execution of operations. The software complements continuous improvement initiatives such as Lean and Six Sigma and work with existing IT systems to maximize these investments by standardizing a practical, scientific framework in an IT solution that makes managing operations easier.

Problem: LeanPhysics Support Tools is claimed to fill a need currently not being met by systems integrator solutions. A key problem with the current approaches to Planning and Execution systems, including MRP, ERP, Advanced Planning and Scheduling systems or Advanced Planning and Optimization systems, is that they ignore random events that increase risk.  The result is that a great deal of computer power is used to create a detailed schedule that becomes obsolete as soon as something unanticipated occurs within the production system or the supply chain.  A supplier with a problem or a new large order coming in can completely wreck an "optimal" schedule. Instead of requiring managers to specify multiple constants that they really do not know, LeanPhysics Support Tools provide a graphical display of nearly 100 optimal solutions to select from that illustrate the relationship between orders, inventory and customer service all on one graph.

Solution: The Factory Physics framework shows conclusively that management has four primary levers - variability, capacity, inventory and time - in trying to determine and execute strategy and tactics to achieve world-class customer satisfaction and profitability. For a given market environment, management can decide whether to increase variability by offering more variety in its product offering or to invest in efforts to reduce variability by making processes more reliable or by improving the forecast. The LeanPhysics Support Tools software provides management with the ability to proactively understand the cost and service tradeoffs inherent in these decisions. At the same time, management can determine an optimal portfolio of buffers (capacity, inventory and time) to employ for fastest, most effective focus and deployment of efforts.

Applications: ERP systems.

Platform: The LeanPhysics Support Tools software suite includes Demand Analyzer - Analysis of the capacity buffer to identify bottlenecks in the supply chain; Flow Analyzer - an analysis of the time buffer to determine cause of long cycle time; Stock Optimizer, which predicts fill rate (percent of time having inventory available) and inventory investment of current systems; and Flow Optimizer, which computes optimal work-in-process (WIP) inventory level to meet target cycle time and demand.

Availability: November 2006 onwards.

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