Supply chain integration: studies on linking customer responsiveness and operational efficiency in logistics policy planning

Abstract The research problem in the thesis deals with improving the responsiveness and efficiency of logistics service processes between a supplier and its customers. The improvement can be sought by customizing the services and increasing the coordination of activities between the different parties in the supply chain. It is argued that to achieve coordination the parties have to have connections on several levels. In the framework employed in this research, three contexts are conceptualized at which the linkages can be planned: 1) the service policy context, 2) the process coordination context, and 3) the relationship management context. The service policy context consists of the planning methods by which a supplier analyzes its customers' logistics requirements and matches them with its own operational environment and efficiency requirements. The main conclusion related to the service policy context is that it is important to have a balanced selection of both customer-related and supplier-related factors in the analysis. This way, while the operational efficiency is planned a sufficient level of service for the most important customers is assured. This kind of policy planning involves taking multiple variables into the analysis, and there is a need to develop better tools for this purpose. Some new approaches to deal with this are presented in the thesis.The process coordination context and the relationship management context deal with the issues of how the implementation of the planned service policies can be facilitated in an inter-organizational environment. Process coordination includes typically such mechanisms as control rules, standard procedures and programs, but inhighly demanding circumstances more integrative coordination mechanisms may be necessary. In the thesis the coordination problems in third-party logistics relationship are used as an example of such an environment. Relationship management deals with issues of how separate companies organize their relationships to improve the coordination of their common processes. The main implication related to logistics planning is that by integrating further at the relationship level, companies can facilitate the use of the most efficient coordination mechanisms and thereby improve the implementation of the selected logistics service policies. In the thesis, a case of a logistics outsourcing relationship is used to demonstrate the need to address the relationship issues between the service provider andthe service buyer before the outsourcing can be done.The dissertation consists of eight research articles and a summarizing report. The principal emphasis in the articles is on the service policy planning context, which is the main theme of six articles. Coordination and relationship issues are specifically addressed in two of the papers.

Dynamics of Appropriability - Finding a Balance between Efficiency and Strength in the Appropriability Regime

Building and sustaining competitive advantage through the creation of market imperfections is challenging in a constantly changing business environment - particularly since the sources of such advantages are increasingly knowledge-based. Facilitated by improved networks and communication, knowledge spills over to competitors more easily than before,thus creating an appropriability problem: the inability of an innovating firm to utilize its innovations commercially. Consequently, as the importance of intellectual assets increases, their protection also calls for new approaches. Companies have various means of protection at their disposal, and by taking advantage of them they can make intangibles more non-transferable and prevent, or at leastdelay, imitation of their most crucial intellectual assets. However, creating barriers against imitation has another side to it, and the transfer of knowledge in situations requiring knowledge sharing may be unintentionally obstructed. Theaim of this thesis is to increase understanding of how firms can balance knowledge protection and sharing so as to benefit most from their knowledge assets. Thus, knowledge protection is approached through an examination of the appropriability regime of a firm, i.e., the combination of available and effective means ofprotecting innovations, their profitability, and the increased rents due to R&D. A further aim is to provide a broader understanding of the formation and structure of the appropriability regime. The study consists of two parts. The first part introduces the research topic and the overall results of the study, and the second part consists of six complementary research publications covering various appropriability issues. The thesis contributes to the existing literature in several ways. Although there is a wide range of prior research on appropriability issues, a lot of it is restricted either to the study of individual appropriability mechanisms, or to comparing certain features of them. These approaches are combined, and the relevant theoretical concepts are clarified and developed. In addition, the thesis provides empirical evidence of the formation of the appropriability regime, which is consequently presented as an adaptive process. Thus, a framework is provided that better corresponds to the complex reality of the current business environment.

Sheeting efficiency improvement through production planning and control development.

Arkitus on kartongin jatkojalostusmuoto, jonka tehokkuus muodostuu monen tekijän vaikutuksesta. Tämän työn tavoitteena oli parantaa arkitustehokkuutta tutkitussa kahden folioleikkurin arkittamossa tuotannonsuunnittelun ja tuotannonohjauksen kehittämisellä. Kartonkitehtaan sisäisessä jalostusketjussa arkitus on viimeinen vaihe, mikä tekee siitä pitkälti riippuvaisen edeltävistä konevaiheista, eli kartonkikoneista ja PE-päällystyskoneista. Pelkkä arkituksen tuotannonsuunnittelun huomiointi ei siis vielä takaa hyvää lopputulosta arkitustehokkuuden kannalta. Folioarkitustoiminta on hyvin asiakassuuntautunutta. Arkkikoot määräytyvät asiakkaiden omien tarpeiden perusteella, jolloin eri arkkikokojen kokonaismäärä kasvaa huomattavan suureksi. Viime vuosien trendinä on ollut tilauseräkokojen pieneneminen. Näiden tekijöiden yhteisvaikutuksena arkituksen tuotantoprosessille on ominaista erilaisten asetusten aiheuttama katkonaisuus. Lisäksi pelkästään yhden millimetrin muutos arkin leveydessä voi usein vaikuttaa arkitustehokkuuteen hyvinkin merkittävästi. Näistä syistä arkituksen tuotannonsuunnittelun apuvälineeksi tarvitaan tarkkuuteen ja joustavuuteen kykenevää tietojärjestelmää. Tehokkaan tuotannonohjauksen tueksi tarvitaan lisäksi erilaisia leikkuri- ja kartonkilaatukohtaisia raportteja. Työn teoriaosassa käsitellään tarkemmin arkitustoiminnan ominaisuuksia ja sen tehokkuuteen vaikuttavia tekijöitä. Lisäksi käsitellään tuotannonsuunnittelun ja tuotannonohjauksen periaatteita ja toimintoja.

Cost-Efficiency of Birch Sprinkling in Kraft Pulping

Työn tavoitteena oli selvittää koivun kasteluvarastoinnin kannattavuus selluteollisuudessa. Lisäksi tutkittiin, kuinka kastelu vaikuttaa puuaineeseen varastoinnin aikana ja kuinka koivun kasteluvarastointi vaikuttaa puun kuorintaan ja haketukseen, keitettävyyteen, vaalenevuuteen sekä sellun laatuun. Enocellin puukentälle rakennettiin kasteluvarasto, jossa varastoitiin 40,000 m3sob koivua. Kastelu oli päällä huhtikuusta lokakuuhun asti. Kastelun vaikutusta puuaineen muutoksiin arvioitiin lahotutkimusten avulla. Tehdaskoeajoissa verrattiin tuoretta, kasteluvarastoitua ja kuivavarastoitua koivua. Puuaines säilyi lähes muuttumattomana yhden kesän kasteluvarastoinnissa. Kastellulla koivulla terveen puun osuus oli yli 85 % kesän lopussa, kun se oli alle 20 % kuivavarastoidulla koivulla. Kuorinnan puuhäviö laskee selvästi kastelukoivulla ja myös hakkeen laatu oli parempaa kuin kuivavarastoidulla koivulla. Kastelukoivulla hakkeen kuoripitoisuus oli vain 0.13 %. Kuoren kuiva-aine oli 12 prosenttiyksikköä alhaisempi kuin kuivalla koivulla, mutta kuoren lämpöarvossa ero oli vain 1 €/ADt. Varastointimenetelmällä ei ollut vaikutusta hakkeen keitettävyyteen, mutta tuoreella puulla keitettävyys oli parempi kuin varastoidulla puulla. Sellun asetoniuutepitoisuus oli samalla tasolla tuoreella ja kastellulla puulla. Kuivalla syyspuulla uutetaso oli korkeampi, vaikka hartsisaippuan annostusta nostettiin 10 kg/ADt. Betulinolitaso oli kastellulla puulla erittäin alhainen puun hyvän kuoriutuvuuden vuoksi. Kastellun ja tuoreen puun vaalenevuus oli parempi kuin kuivalla puulla. Aktiivikloorin kulutus oli 3 – 4 kg/ADt alhaisempi kuin kuivalla syyspuulla. Puun varastoinnilla ei ollut vaikutusta sellun laatuun. Koivun kasteluvarastoinnin kannattavuus on erittäin hyvä. Tuotantokustannukset määritettiin tuoreelle, kastellulle, kierrätetylle sekä kuivalle koivulle. Kasteluvarastointi laskee tuotantokustannuksia noin 10 €/ADt verrattuna kierrätettyyn koivuun. Kuivavarastoidun puun käyttö nostaa tuotantokustannuksia noin 5 €/ADt verrattuna kastelukoivuun. Kierrätetyn ja kuivavarastoidun puun kustannusero johtuu kierrätyskustannuksista. Kasteluvarastolle, jota käytettiin kesällä 2004, takaisinmaksuaika on vain 0.4 vuotta. Jos tavoiteltu takaisinmaksuaika olisi kaksi vuotta, niin perusinvestointi 80,000 m3sob varastolle voisi maksaa noin 370 k€.

Brown algal phlorotannins: Improving and applying chemical methods

Phlorotannins are the least studied group of tannins and are found only in brown algae. Hitherto the roles of phlorotannins, e.g. in plant-herbivore interactions, have been studied by quantifying the total contents of the soluble phlorotannins with a variety of methods. Little attention has been given to either quantitative variation in cell-wall-bound and exuded phlorotannins or to qualitative variation in individual compounds. A quantification procedure was developed to measure the amount of cell-wall-bound phlorotannins. The quantification of soluble phlorotannins was adjusted for both large- and small-scale samples and used to estimate the amounts of exuded phlorotannins using bladder wrack (Fucus vesiculosus) as a model species. In addition, separation of individual soluble phlorotannins to produce a phlorotannin profile from the phenolic crude extract was achieved by high-performance liquid chromatography (HPLC). Along with these methodological studies, attention was focused on the factors in the procedure which generated variation in the yield of phlorotannins. The objective was to enhance the efficiency of the sample preparation procedure. To resolve the problem of rapid oxidation of phlorotannins in HPLC analyses, ascorbic acid was added to the extractant. The widely used colourimetric method was found to produce a variation in the yield that was dependent upon the pH and concentration of the sample. Using these developed, adjusted and modified methods, the phenotypic plasticity of phlorotannins was studied with respect to nutrient availability and herbivory. An increase in nutrients decreased the total amount of soluble phlorotannins but did not affect the cell-wall-bound phlorotannins, the exudation of phlorotannins or the phlorotannin profile achieved with HPLC. The presence of the snail Thedoxus fluviatilis on the thallus induced production of soluble phlorotannins, and grazing by the herbivorous isopod Idotea baltica increased the exudation of phlorotannins. To study whether the among-population variations in phlorotannin contents arise from the genetic divergence or from the plastic response of algae, or both, algae from separate populations were reared in a common garden. Genetic variation among local populations was found in both the phlorotannin profile and the content of total phlorotannins. Phlorotannins were also genetically variable within populations. This suggests that local algal populations have diverged in their contents of phlorotannins, and that they may respond to natural selection and evolve both quantitatively and qualitatively.

Nutrient enrichment and water depth modify consumer control in rocky shore macroalgal communities

The objective of my thesis is to assess mechanisms of ecological community control in macroalgal communities in the Baltic Sea. In the top-down model, predatory fish feed on invertebrate mesograzers, releasing algae partly from grazing pressure. Such a reciprocal relationship is called trophic cascade. In the bottom-up model, nutrients increase biomass in the food chain. The nutrients are first assimilated by algae and, via food chain, increase also abundance of grazers and predators. Previous studies on oceanic shores have described these two regulative mechanisms in the grazer - alga link, but how they interact in the trophic cascades from fish to algae is still inadequately known. Because the top-down and bottom-up mechanisms are predicted to depend on environmental disturbances, such as wave stress and light, I have studied these models at two distinct water depths. There are five factorial field experiments behind the thesis, which were all conducted in the Finnish Archipelago Sea. In all the experiments, I studied macroalgal colonization - either density, filament length or biomass - on submerged colonization substrates. By excluding predatory fish and mesograzers from the algal communities, the studies compared the strength of the top-down control to natural algal communities. A part of the experimental units were, in addition, exposed to enriched nitrogen and phosphorus concentrations, which enabled testing of bottom-up control. These two models of community control were further investigated in shallow (<1 m) and deep (ca. 3 m) water. Moreover, the control mechanisms were also expected to depend on grazer species. Therefore different grazer species were enclosed into experimental units and their impacts on macroalgal communities were followed specifically. The community control in the Baltic rocky shores was found to follow theoretical predictions, which have not been confirmed by field studies before. Predatory fish limited grazing impact, which was seen as denser algal communities and longer algal filaments. Nutrient enrichment increased density and filament length of annual algae and, thus, changed the species composition of the algal community. The perennial alga Fucus vesiculosusA and the red alga Ceramium tenuicorne suffered from the increased nutrient availabilities. The enriched nutrient conditions led to denser grazer fauna, thereby causing strong top-down control over both the annual and perennial macroalgae. The strength of the top-down control seemed to depend on the density and diversity of grazers and predators as well as on the species composition of macroalgal assemblages. The nutrient enrichment led to, however, weaker limiting impact of predatory fish on grazer fauna, because fish stocks did not respond as quickly to enhanced resources in the environment as the invertebrate fauna. According to environmental stress model, environmental disturbances weaken the top-down control. For example, on a wave-exposed shore, wave stress causes more stress to animals close to the surface than deeper on the shore. Mesograzers were efficient consumers at both the depths, while predation by fish was weaker in shallow water. Thus, the results supported the environmental stress model, which predicts that environmental disturbance affects stronger the higher a species is in the food chain. This thesis assessed the mechanisms of community control in three-level food chains and did not take into account higher predators. Such predators in the Baltic Sea are, for example, cormorant, seals, white-tailed sea eagle, cod and salmon. All these predatory species were recently or are currently under intensive fishing, hunting and persecution, and their stocks have only recently increased in the region. Therefore, it is possible that future densities of top predators may yet alter the strengths of the controlling mechanisms in the Baltic littoral zone.

Improvement of Operational Efficiency effectiveness (OEE) using Six Sigma DMAIC Methodology — Case Bottomer line AD2378

Overall Equipment Effectiveness (OEE) is the key metric of operational excellence. OEE monitors the actual performance of equipment relative to its performance capabilities under optimal manufacturing conditions. It looks at the entire manufacturing environment measuring, in addition to the equipment availability, the production efficiency while the equipment is available to run products, as well as the efficiency loss that results from scrap, rework, and yield losses. The analysis of the OEE provides improvement opportunities for the operation. One of the tools used for OEE improvement is Six Sigma DMAIC methodology which is a set of practices originally developed to improve processes by eliminating defects. It asserts the continuous efforts to reduce variation in process outputs as key to business success, as well as the possibility of measurement, analysis, improvement and control of manufacturing and business processes. In the case of the Bottomer line AD2378 in Papsac Maghreb Casablanca plant, the OEE figures reached 48.65 %, which is below the accepted OEE group performance. This required immediate actions to achieve OEE improvement. This Master thesis focuses on the application of Six Sigma DMAIC methodology in the OEE improvement on the Bottomer Line AD2378 in Papsac Maghreb Casablanca plant. First, the Six Sigma DMAIC and OEE usage in operation measurement will be discussed. Afterwards, the different DMAIC phases will allow the identification of improvement focus, the identification of OEE low performance causes and the design of improvement solutions. These will be implemented to allow further tracking of improvement impact on the plant operations.

Energy efficiency parameters in variable speed drives

The main purpose of this thesis is to measure and evaluate how accurately the current energy saving calculation in ABB’s new variable speed drive ACS850 works. The main topic of this thesis is energy-efficiency parameters. At the beginning of this thesis centrifugal pump, squirrel cage motor and variable speed drive, including some equations related to them, are being introduced. Also methods of throttling control and variable speed drive control of centrifugal pumps are being introduced. These subjects are introduced because the energy saving calculation in ACS850 is related to the centrifugal pumps usually driven by squirrel cage motors. The theory also includes short section about specific energy of pumping. Before measurements the current energy saving calculation of ACS850 is being introduced and analyzed. The measurements part includes introduction of measuring equipment, measurement results, summary and analysis of the measurements. At the end of this thesis a proposal for an improvement to the current energy saving calculation is being introduced and few proposals are made for new energy-efficiency parameters, which could be added to variable speed drives. At the end are also thoughts

Enhancing the efficiency of freight transport by using simulation

The role of transport in the economy is twofold. As a sector of economic activity it contributes to a share of national income. On the other hand, improvements in transport infrastructure create room for accelerated economic growth. As a means to support railways as a safe and environmentally friendly transportation mode, the EU legislation has required the opening of domestic railway freight for competition from beginning of year 2007. The importance of railways as a mode of transport has been great in Finland, as a larger share of freight has been carried on rails than in Europe on average. In this thesis it is claimed that the efficiency of goods transport can be enhanced by service specific investments. Furthermore, it is stressed that simulation can and should be used to evaluate the cost-efficiency of transport systems on operational level, as well as to assess transportation infrastructure investments. In all the studied cases notable efficiency improvements were found. For example in distribution, home delivery of groceries can be almost twice as cost efficient as the current practice of visiting the store. The majority of the cases concentrated on railway freight. In timber transportation, the item with the largest annual transport volume in domestic railway freight in Finland, the transportation cost could be reduced most substantially. Also in international timber procurement, the utilization of railway wagons could be improved by combining complementary flows. The efficiency improvements also have positive environmental effects; a large part of road transit could be moved to rails annually. If impacts of freight transport are included in cost-benefit analysis of railway investments, up to 50 % increase in the net benefits of the evaluated alternatives can be experienced, avoiding a possible inbuilt bias in the assessment framework, and thus increasing the efficiency of national investments in transportation infrastructure. Transportation systems are a typical example of complex real world systems that cannot be analysed realistically by analytical methods, whereas simulation allows inclusion of dynamics and the level of detail required. Regarding simulation as a viable tool for assessing the efficiency of transportation systems finds support also in the international survey conducted for railway freight operators; operators use operations research methods widely for planning purposes, while simulation is applied only by the larger operators.

Analyzing the cost-efficiency and performance of a payroll department by benchmarking

Tämän diplomityön tavoitteena oli analysoida Stora Enson palkkakeskuksen ja sen henkilöstöhallinnon järjestelmän, SAP HR:n, kustannustehokkuutta ja suorituskykyä. Tutkimuksessa käytettiin apuna benchmarkingia. Viisi suurta suomalaisyritystä osallistui benchmarkingiin. Benchmarkingin pääkohteena oli yritysten välinen kustannusvertailu. Kyselyssä perehdyttiin myös yritysten järjestelmien suorituskykyyn. Tuloksien perusteella Stora Enson palkkakeskus tarjoaa kustannustehokkaan ja kilpailukykyisen ratkaisun, joka menestyy hyvin vertailussa muihin suomalaisiin yrityksiin.

The effect of pulp washing on bleaching efficiency

The main aim of this study was to inspect the influence of the ultrafiltration implementation on the washing and on bleaching efficiency. Four cases corresponding to four washing stages were observed: two with hardwood pulp and two with softwood pulp; each case had a reference and a trial experiment. The experiments with hardwood pulp were arranged in a manner to explore predominantly the possibility of bleaching performance improvement by applying for washing instead of untreated filtrate (reference case) the same treated one (trial case). Despite that the ultrafiltration reduced the COD of the wash filtrates allowing the decreasing of COD carry-over to the bleaching stage it didn’t affect the bleaching performance. Another set was used in the experiments with softwood pulp. It implied the ultrafiltration and recirculation of the filtrate to the same washing stage with the purpose to reduce the volumes and pollution of the bleaching effluents. In one case the negative result was obtained which was expressed by worse parameters of the pulp after bleaching. Another case showed the opportunity to replace hot water with the filtrate and reduce the fresh water consumption.

Environmental policy instruments concerning industrial end-use energy efficiency

Energy efficiency and saving energy are the main question marks when thinking of reducing carbon dioxide emissions or cutting costs. The objective of thesis is to evaluate policy instruments concerning end-use energy efficiency of heavy industry in European Union. These policy instruments may be divided in various ways, but in this thesis the division is to administrative, financial, informative and voluntary instruments. Administrative instruments introduced in this thesis are Directive on Integrated Pollution Prevention and Control, Directive on Energy End-use Efficiency and Energy Services, and Climate and Energy Package. Financial means include energy and emission taxation, EU Emission Trading Scheme and diverse support systems. Informative instruments consist of horizontal BAT Reference Document for Energy Efficiency, as well as substantial EU documents including Green Paper on Energy Efficiency, Action Plan for Energy Efficiency and An Energy Policy for Europe. And finally, voluntary instruments include environmental managements systems like ISO 14001 and EMAS, energy auditing and benchmarking. The efficiency of different policy instruments vary quite a lot. Informative instruments lack the commitment from industry and are thus almost ineffective, contrary to EU Emission Trading Scheme, which is said to be the solution to climate problems. The efficiency of administrative means can be placed between those mentioned and voluntary instruments are still quite fresh to be examined fruitfully. However, each instrument has their potential and challenges. Cases from corporate world strengthen the results from theoretical part. Cases were written mainly on the basis of interviews. The interviewees praised the energy efficiency contract of Finnish industry, but the EU ETS takes the leading role of policy instruments. However, for industry the reductions do not come easily.