Guru Simulation Training

Agenda Introduction Data Model 1st Pass: Basic Structure Data Model 2nd Pass: Policy Detail Data Model 3rd Pass: Implementation

Agenda Introduction Data Model 1st Pass: Basic Structure What are we going to Cover? Data Model 1st Pass: Basic Structure Data Model 2nd Pass: Policy Detail Data Model 3rd Pass: Implementation

Introduction to the Data Model Data Model 1st Pass: High Level Structure 30,000 Ft view Basic structural pieces Data Model 2nd Pass: Policy Detail 15,000 Ft view Integrate details about inventory, sourcing and transportation policies Data Model 3rd Pass: Implementation 1000 Ft view How are the Guru Tables used to create a model

Agenda Introduction Data Model 1st Pass: Basic Structure Basic Structural Elements Walkthrough of Events Data Model 2nd Pass: Policy Detail Data Model 3rd Pass: Implementation

Data Model 1st Pass: Basic Structure Products Required Elements Name Value Price Weight Cube Product

Data Model 1st Pass: Basic Structure Sites Required Elements Name – Unique Location – Lat/Long or Street Address Type – Customer (Demand Point) or Facility (Hold Inventory) CZ DC MFG

Data Model 1st Pass: Basic Structure Demand Required Elements Site Product Time Quantity CZ Demand

Data Model 1st Pass: Basic Structure Single Source Sourcing Policies Determines where the order will be sourced from Types of Policies Single Source Multiple Sources Make Required Elements Source Destination Product Policy CZ DC Multiple Sources DC1 CZ DC2 Make MFG

Data Model 1st Pass: Basic Structure Inventory Policies Specifies when and how to replenish inventory Required Elements Site Product Policy DC IP

Data Model 1st Pass: Basic Structure Transportation Policies Required Elements Source Destination CZ DC

Data Model 1st Pass: Review Basic Structural Elements Products Sites Demand Sourcing Policies Inventory Policies Transportation Policies What are the Required Elements of each? What are the different Sourcing Policy Types?

Data Model 1st Pass: Walkthrough Demand Enters the Network CZ DC MFG Demand Customer (CZ) demands for a specific “Product”

Data Model 1st Pass: Walkthrough Customer Source Selection SP CZ DC MFG Demand CZ chooses appropriate source based on Sourcing Policy Order placed at Distribution Center (DC) for quantity of product demanded

Data Model 1st Pass: Walkthrough DC Inventory Review IP SP CZ DC MFG Demand Not enough inventory at the DC to fill the order – The DC places a replenishment order

Data Model 1st Pass: Walkthrough DC Source Selection IP SP SP CZ DC MFG Demand DC has Need for Replenishment DC chooses appropriate source (sourcing policy), creates order at Manufacturer (MFG)

Data Model 1st Pass: Walkthrough MFG Inventory Review IP IP SP SP CZ DC MFG Demand Inventory Sufficient to fill order – Create replenishment order

Data Model 1st Pass: Walkthrough MFG Source Selection IP IP SP SP CZ DC MFG Demand SP MFG has Need for Replenishment Since the MFG has a “Make” sourcing policy, it creates production order

Data Model 1st Pass: Walkthrough MFG Delivery to Customer through DC Demand SP IP CZ DC MFG TP Production Complete, Shipping Item Created at MFG Ship Quantity to CZ through DC by specified transportation policies Order Complete

Discrete Event Simulation Think about it as events that are scheduled on a calendar One event may lead to several other events being scheduled Demand - Production Scheduled Shipments - Delivery Inventory Replenishment/Review Sun Mon Tue Wed Thu Fri Sat 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31

Discrete Event Simulation Think about it as events that are scheduled on a calendar One event may lead to several other events being scheduled Demand from CZ -> 10/2/07 at 4:00 pm -> Order by CZ CZ Demand / Order Gen. Sun Mon Tue Wed Thu Fri Sat 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31

Discrete Event Simulation Think about it as events that are scheduled on a calendar One event may lead to several other events being scheduled Demand from CZ -> 10/2/07 at 4:00 pm -> Order by CZ DC Inventory Review -> 10/3/07 at 12:00 am -> Order by DC CZ Demand / Order Gen. DC Inventory Check / Order Gen. Sun Mon Tue Wed Thu Fri Sat 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31

Discrete Event Simulation Think about it as events that are scheduled on a calendar One event may lead to several other events being scheduled Demand from CZ -> 10/2/07 at 4:00 pm -> Order by CZ DC Inventory Review -> 10/3/07 at 12:00 am -> Order by DC MFG Inventory Review -> 10/4/07 at 12:00 am -> Order by MFG CZ Demand / Order Gen. DC Inventory Check / Order Gen. Sun Mon Tue Wed Thu Fri Sat 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 MFG Inventory Check / Order Gen.

Discrete Event Simulation Think about it as events that are scheduled on a calendar One event may lead to several other events being scheduled Demand from CZ -> 10/2/07 at 4:00 pm -> Order by CZ DC Inventory Review -> 10/3/07 at 12:00 am -> Order by DC MFG Inventory Review -> 10/4/07 at 12:00 am -> Order by MFG MFG Production -> 10/5/07 at 4:00 pm CZ Demand / Order Gen. DC Inventory Check / Order Gen. Sun Mon Tue Wed Thu Fri Sat 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 MFG Inventory Check / Order Gen. Production at MFG

Discrete Event Simulation Think about it as events that are scheduled on a calendar One event may lead to several other events being scheduled Demand from CZ -> 10/2/07 at 4:00 pm -> Order by CZ DC Inventory Review -> 10/3/07 at 12:00 am -> Order by DC MFG Inventory Review -> 10/4/07 at 12:00 am -> Order by MFG MFG Production -> 10/5/07 at 4:00 pm Shipment Leaves MFG -> 10/8/07 at 8:00 am CZ Demand / Order Gen. DC Inventory Check / Order Gen. Sun Mon Tue Wed Thu Fri Sat 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 Shipment Leaves MFG MFG Inventory Check / Order Gen. Production at MFG

Discrete Event Simulation Think about it as events that are scheduled on a calendar One event may lead to several other events being scheduled Demand from CZ -> 10/2/07 at 4:00 pm -> Order by CZ DC Inventory Review -> 10/3/07 at 12:00 am -> Order by DC MFG Inventory Review -> 10/4/07 at 12:00 am -> Order by MFG MFG Production -> 10/5/07 at 4:00 pm Shipment Leaves MFG -> 10/8/07 at 8:00 am Shipment Arrives at DC -> 10/10/07 at 2:33 pm CZ Demand / Order Gen. DC Inventory Check / Order Gen. Sun Mon Tue Wed Thu Fri Sat 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 Shipment Leaves MFG MFG Inventory Check / Order Gen. Shipment Arrives at DC Production at MFG

Discrete Event Simulation Think about it as events that are scheduled on a calendar One event may lead to several other events being scheduled Demand from CZ -> 10/2/07 at 4:00 pm -> Order by CZ DC Inventory Review -> 10/3/07 at 12:00 am -> Order by DC MFG Inventory Review -> 10/4/07 at 12:00 am -> Order by MFG MFG Production -> 10/5/07 at 4:00 pm Shipment Leaves MFG -> 10/8/07 at 8:00 am Shipment Arrives at DC -> 10/10/07 at 2:33 pm Shipment Leaves DC -> 10/11/07 at 8:00 am CZ Demand / Order Gen. DC Inventory Check / Order Gen. Sun Mon Tue Wed Thu Fri Sat 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 Shipment Leaves MFG MFG Inventory Check / Order Gen. Shipment Arrives at DC Production at MFG Shipment Leaves DC

Discrete Event Simulation Think about it as events that are scheduled on a calendar One event may lead to several other events being scheduled Demand from CZ -> 10/2/07 at 4:00 pm -> Order by CZ DC Inventory Review -> 10/3/07 at 12:00 am -> Order by DC MFG Inventory Review -> 10/4/07 at 12:00 am -> Order by MFG MFG Production -> 10/5/07 at 4:00 pm Shipment Leaves MFG -> 10/8/07 at 8:00 am Shipment Arrives at DC -> 10/10/07 at 2:33 pm Shipment Leaves DC -> 10/11/07 at 8:00 am Shipment Arrives at CZ -> 10/11/07 at 2:22 pm CZ Demand / Order Gen. DC Inventory Check / Order Gen. Sun Mon Tue Wed Thu Fri Sat 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 Shipment Leaves MFG MFG Inventory Check / Order Gen. Shipment Arrives at DC Shipment Arrives at CZ Production at MFG Shipment Leaves DC

Data Model 1st Pass: Model Creation Open Supply Chain Guru

Data Model 1st Pass: Model Creation Add a New Model Go to File  Add A New Model

Data Model 1st Pass: Model Creation Save the Model in Training Folder C://Llamasoft/Training Save Model As: Sim_Training_Basic Save Project As: Guru_Training

Data Model 1st Pass: Model Creation Network Simulation Inputs Sites, Products, Demand Sourcing Polices Inventory Policies Transportation Policies

Data Model 1st Pass: Model Creation The Model we will Build 3 Sites 1 Product Demand SP IP CZ DC MFG TP Product

Data Model 1st Pass: Products Add Products to the Guru Model Name/SKU Inventory Valuation Price Weight, Cubic Status Product

Data Model 1st Pass: Products Add Products to the Guru Model Open the Products Table Add a Product with the following information: Name: Product Value: 5 Price: 10 Weight: 5 Cubic: 5 Type: Discrete Status: Include

Data Model 1st Pass: Sites Add Sites to the Guru Model Name Location (Address, City, State, Country, Postal Code, Latitude, Longitude) Capacity Period, Capacity Basis Fixed Startup Cost/Cap, Fixed Operating Cost/Cap Closing Cost MFG DC CZ

Data Model 1st Pass: Sites Open the Sites Table Add Customer Site: Name: CZ City: New York State: New York Type: Customer Graphic: Circle Graphic Color: Green

Data Model 1st Pass: Sites Add Distribution Center: Name: DC City: Omaha State: Nebraska Type: Existing Facility Graphic: Triangle Graphic Color: Yellow

Data Model 1st Pass: Sites Add Manufacturer: Name: MFG City: Los Angeles State: California Type: Existing Facility Graphic: Square Graphic Color: Red

Data Model 1st Pass: Sites Display the Sites on the Map

Data Model 1st Pass: Demand Add Demand to the Guru Model - Customer Site - Time Between Orders - Product - Due Date - Quantity - Unit Price - Occurrences CZ Demand In

Data Model 1st Pass: Demand Add Demand to the Guru Model Open the Demand Table Add (1) Demand Record with the following information: Customer: CZ Due Date: 5 Day Product: Product Occurrences: INF Quantity: 100 Time Between Orders: 1 WK Order Time: 0

Data Model 1st Pass: Review IP IP SP SP CZ DC MFG SP Demand TP TP

Agenda Introduction Data Model 1st Pass: Basic Structure Data Model 2nd Pass: Policy Detail Sourcing Policies Inventory Policies Transportation Policies Data Model 3rd Pass: Implementation

Data Model 2nd Pass: Sourcing Sourcing Policies Basic Types Upstream Replenishment Single Source Multiple Sources Self Replenishment Make Required Elements Source Destination Product Policy Type Single Source CZ DC Multiple Sources DC1 CZ DC2 Make MFG

Data Model 2nd Pass: Sourcing Available Sourcing Policies Single Source Multiple Sources (Most Inventory) Multiple Sources (Order by Preference) Multiple Sources (Probability) Make – Single, Multiple (Order by Preference, Probability) Custom

Data Model 2nd Pass: Sourcing Sourcing Walkthrough Review SP CZ DC MFG Demand

Data Model 2nd Pass: Sourcing Add Sourcing Policies to the Guru Model For each Site/Product pair, define a Sourcing Policy linking the source to the destination site MFG CZ DC Product

Data Model 2nd Pass: Sourcing Add Sourcing Policies to the Guru Model Open the Sourcing Policies Table Add a total of (3) Sourcing Policies 2 of type Single Source Customer to DC DC to Manufacturer 1 for each DC-Product combination 1 of type Make 1 for each product at the Manufacturer

Data Model 2nd Pass: Sourcing Display the Sourcing Policies on the Map

Data Model 2nd Pass: Review IP IP SP SP CZ DC MFG SP Demand TP TP

Data Model 2nd Pass: Inventory Inventory Policies Required Elements Site Product Policy Type DC IP

Data Model 2nd Pass: Inventory Inventory Policy Detail There are three things beyond site, product and policy that are also necessary for any inventory policy Point at which you reorder, what threshold? Reorder Point (RP) Amount of which you order? Reorder Quantity / Order Up To Quantity (RQ) When you check inventory levels? Review Period (P) T RP Q RQ P

Data Model 2nd Pass: Inventory Total Inventory Quantity Details Quantity Ordered but not yet Received (COQ) Current Units in Inventory Days RP Units RQ Order Received Current Inventory + COQ Order Placed

Data Model 2nd Pass: Inventory Available Inventory Policies Demand Flow One for One Replenishment R,Q Fixed Reorder Point / Order Quantity S,s Fixed Reorder Point / Order Up To Quantity

Data Model 2nd Pass: Inventory Available Inventory Policies Demand Flow (one for one replenishment) Q T

Data Model 2nd Pass: Inventory Available Inventory Policies R,Q (fixed reorder point, reorder qty) Q T RP RQ

Data Model 2nd Pass: Inventory Available Inventory Policies S,s (Fixed reorder point, order up to point) Q T RP RQ

Data Model 2nd Pass: Inventory Available Inventory Policies S,s Targets Change Reorder Point / Order Up To Qty by period R,Q Targets Change Reorder Point / Order Quantity by period Custom Policy

Data Model 2nd Pass: Inventory Available Inventory Policies DOS Demand Based on Previous Demand DOS Window – Calculate Reorder Point and Order Up To Quantity DOS Forecast Based on Demand Forecast DOS Window – Calculate Reorder point and Order Up To Quantity Planning Lead Time (LT) – Offset Window for Seasonality Time Window Time Window LT

Data Model 2nd Pass: Inventory Inventory Walkthrough Review IP SP CZ DC MFG Demand

Data Model 2nd Pass: Inventory Add Inventory Policies to the Guru Model One Inventory Policy is optional for each product at each non-Customer site. Each Inventory Policy defines: Initial Inventory levels Safety/Cycle Stock Levels Associated Costs DC MFG Product

Data Model 2nd Pass: Inventory Add Inventory Policies to the Guru Model Open the Inventory Policies Table Add (2) Inventory Policies One for each (non-Customer) Site-Product combination Sites: MFG, DC Products: Product Leave all other fields at default value

Data Model 2nd Pass: Review IP IP SP SP CZ DC MFG SP Demand TP TP

Data Model 2nd Pass: Transportation Transportation Policies Required Elements Source Destination Mode Lane = Collection of Modes between a Source and Destination DC CZ DC – CZ Lane

Data Model 2nd Pass: Transportation Transportation Lane Details Lane Elements: Source Lane Queue Modes Destination Mode Rules Shipping Items Mode Queue DC – CZ Lane DC Source Mode Queue Mode 1 Mode 2 Modes CZ Destination Lane Queue Mode Rules Shipping Item

Data Model 2nd Pass: Transportation Transportation Mode Rules Mode 1 Mode 2 Mode 3 Mode 4 Mode Rules CZ DC DC – CZ Lane

Data Model 2nd Pass: Transportation Transportation Mode Rule Details First – selects the first mode alphabetically First Available Asset – selects the mode with the first asset available By Probability – Chooses mode based on chance/probability On Due Date – Sends shipment on mode if necessary for on time On QTY, Weight, Cubic – lists classes for each mode (0-500 ->0), (500-INF->500) Queue Only – just place in queue do not ship Custom Mode Selection Mode 1 Mode 2 Mode 3 Mode 4 CZ DC DC – CZ Lane

Data Model 2nd Pass: Transportation Transportation Modes LTL Full TL Periodic Pooled Modes CZ DC DC – CZ Lane

Data Model 2nd Pass: Transportation Transportation Mode Details LTL Full TL Periodic Pooled CZ DC DC – CZ Lane Full TL Requires Asset, Fill level and Capacity Released from Queue when full LTL Shipped Immediately Periodic Scheduled Shipments Requires Shipment Period Pooled (inbound and Outbound) Multiple Stops/Deliveries (Milk Run) Requires Asset, Fill Level and Capacity Other Parcel, air, rail and ship. Function as LTL If Asset is used, function as Full TL

Data Model 2nd Pass: Transportation Transportation Assets Elements Name Number of Units Fill level (Weight or Cube) Capacity (Weight or Cube) Only Released if fill level reached LTL Full TL Periodic Pooled Mode Asset Required Yes No DC CZ DC – CZ Lane

Data Model 2nd Pass: Transportation Transportation Costs Applied to each mode 4 ways to Enter Costs Number Step Function Dynamic Rate (Input Pipe) Custom Cost Basis – Qty, Distance, Weight Cubic, etc.

Data Model 2nd Pass: Transportation Transportation Policy Walkthrough Shipping Item Queued at Lane Order gets put into lane queue as a Shipping Item Mode 1 Mode 2 Shipping Item Lane Queue

Data Model 2nd Pass: Transportation Transportation Policy Walkthrough Review Period for Queue Contents of Queue evaluated at Review Period Mode 1 Mode 2 Shipping Item Lane Queue

Data Model 2nd Pass: Transportation Transportation Policy Walkthrough Mode Rule Execution Mode Selected by Mode Rule Shipping Item Sent to Queue at the Mode Mode 1 Mode 2 Shipping Item Lane Queue Mode Rule

Data Model 2nd Pass: Transportation Transportation Policy Walkthrough Mode Behavior Shipping Item Queued at the Mode LTL - Ship Immediately Full TL – Wait for Fill Level, then ship Mode 1 Mode 2 Shipping Item Lane Queue Mode Queue Mode Rule

Data Model 2nd Pass: Transportation Transportation Policy Walkthrough Item Shipped Item placed on appropriate mode, released to destination Mode 1 Mode 2 Shipping Item Lane Queue Mode Queue Mode Decision

Data Model 2nd Pass: Transportation Transportation Walkthrough Review IP IP SP SP CZ DC MFG SP Demand TP TP Mode 1 Mode 2

Data Model 2nd Pass: Transportation Add Transportation Policies to the Guru Model There is at least one Transportation Policy that applies to a Sourcing Policy which is not “Make” Each Transportation Policy defines a “Flow”: Source Site Destination Site Product (all applicable products if not explicitly entered) Mode (1 if not explicitly entered) MFG DC CZ

Data Model 2nd Pass: Transportation Add Transportation Policies to the Guru Model Open the Transportation Policies Table Add (2) Transportation Policies One for each Source-Destination combination defined in Sourcing Policies Sources: MFG, DC Destinations: DC, CZ Leave all other fields at default value

Data Model 2nd Pass: Review IP IP SP SP CZ DC MFG SP Demand TP TP Mode 1 Mode 2

Agenda Introduction Data Model 1st Pass: Basic Structure Data Model 2nd Pass: Policy Detail Data Model 3rd Pass: Implementation Additional Features Output Analysis

Data Model 3rd Pass: Implementation We have already created the Basic Structure of our Model Products Sites Demand Sourcing Policies Inventory Policies Transportation Policies Lets try running our model!

Data Model 3rd Pass: Running the Model Open the Model Options Simulation Period (Tools -> Model Options (F3)) Specified by: Start Date/Time End Date/Time Start Date/Time End Date/Time

Data Model 3rd Pass: Running the Model Open the Simulation Control Panel Simulate -> Simulate Supply Chain (F7) Hit Run! Error Check?

Data Model 3rd Pass: Results Analysis Analyzing the Results Simulation Output Tables Network Summary Site Summary Product Summary Inventory Details Service Details Shipment Transactions

Data Model 3rd Pass: Additional Details Additional Details we will add/change: Inventory Policies Costs Transportation Times Sourcing

Data Model 3rd Pass: Inventory Open the Inventory Policies Table Add Policies & Costs DC – Product MFG – Product Policy = R,Q Policy = s,S Reorder Point = 500 Reorder Point = 500 Reorder Qty = 1000 Reorder Qty = 1000 Review Period = Daily Review Period = Daily Initial Inventory = 750 Initial Inventory = 750 Inbound Cost = 0.5 Inbound Cost = 0.3 Outbound Cost = 0.5 Inbound Cost = 0.3

Data Model 3rd Pass: Transportation Transportation Policy Modification Open the Demand Table Add An Additional Demand CZ, Product, 50, 0, 5 DAY, INF, 2 WK Open the Transportation Policies Table Create an additional DC -> CZ Policy, mode 2 Set the Following: Mode 1 Mode 2 Mode Rule: On Qty Mode Rule: On Qty Parameter: 0 Parameter:125 Cost: 0.5 Cost:0.3

Data Model 3rd Pass: Sourcing Sourcing Policies Modification Open the Sites Table Add An Additional DC to the sites table DC_2, location = Dallas, TX, 75201 Auto Generate Alternative Sources Replicate DC inventory, sourcing, and transportation policies for DC_2 Open the Sourcing Policies Table Modify the sourcing policies for DC and DC_2 Set both sourcing policies to Multiple Sources(Probability) Set both parameters to 50 Set the Sourcing Cost of the Make Policy to 1

Data Model 3rd Pass: Results Analysis Analyzing the Results Simulation Output Tables Network Summary Site Summary Product Summary Inventory Details Service Details Shipment Transactions

Final Review IP IP SP SP CZ DC MFG SP Demand TP TP Mode 1 Mode 2