Corporate Material and Information Flow / Logistics Demonstrator

Logistics demonstrator Image: Thilo Vogel

A lack of connectivity between different solutions often prevents an efficient added value in production and logistic networks if as much as the necessary information is not available on time in an adequate quality. The optimization of logistic performance of manufacturing companies through the application of innovative concepts and solutions in logistics and IT is researched by the FIR at the RWTH Aachen. As part of the Cluster of Excellence at RWTH Aachen University, the FIR works with manufacturing and service companies, associations and software companies to develop new solutions to further improve the logistics performance. For this reason university and industry collaborate in the Campus-Cluster Logistics to work together to develop new approaches in production, logistics and services. The aim of the Campus-Cluster Logistics is to make the increasingly complex logistical coherences and concepts more tangible and explorable in the real production and IT environments. The Campus-Cluster Logistics offers a development and testing environment in order to decipher the complex relationships in logistics and to finally illustrate them in a real production and IT environment. The centre of the RWTH Aachen Campus-Cluster Logistics has three Innovation Labs: the ERP Innovation Lab, the Smart Objects lnnovation Lab and Service Science lnnovation Lab.

Practical Issues

Logistics Cluster of Excellence Integrative Production Technology for High-Wage Countries

Manufacturing companies need to design processes of production planning and order processing in an efficient way but they are simultaneously facing challenges such as lack of data availability, low information transparency and inadequate integration of information systems or their absence. Therefore, actors in the supply chain can only
work with their ”local” information, so not seeing the big figure which can lead to economically more favourable decisions. Hence, the consideration of the horizontal and vertical integration is of enormous importance. The vertical integration (within the company) is defined as the harmonization and integration of the company‘s internal information technology from the automated acquisition of high-resolution movement data (eg. RFID) till the use of this data in higher-mounted planning and control systems (eg. Manufacturing Execution System, MES for short). A cross-company exchange of relevant information along the supply chain is defined as horizontal integration. It enables companies to share electronic messages such as orders, order confirmations, delivery notes etc. paperless and without large time delays. At the same time the horizontal integration enables the efficient usage of logistical cooperation concepts such as Collaborative Planning, Forecasting and Replenishment (CPFR) and hereby minimises the risk of building up stocks and order quantities (the so-called bullwhip effect). Especially in the inter-company context the benefits of the Electronic Product Code Information Service (EPCIS) are noticeable. In particular through the interaction of EDI and EPCIS optimization potentials can be realised in company production and supplier networks. The interaction of vertical and horizontal integration provides a stable base for flexible supply chains. The ability to react opens up the possibility of targeted cost savings through transparent process design. Cost-intensive sectors, such as stocks, can be identified and sustainably improved. As a requirement towards a reactive and sustainable supply chain, the real-time capability of the systems and the communication between the systems need to be established. Real-time capability refers to the ability of a system to provide needed information and to be able to process the information within a stipulated time frame.


Logistics demonstrator Cluster of Excellence Integrative Production Technology for High-Wage Countries

The logistics demonstrator which was developed in collaboration with partners of the RWTH Aachen Campus-Cluster Logistics and the FIR illustrates possibilities and potentials of horizontal and vertical integration. The aim of the demonstrator is to highlight complex relationships in logistics and make the potential of vertical and horizontal
integration understandable. The logistics demonstrator displays the essential steps in order processing. Due to the given transparency various scenarios can be tested and all effects of any change can be disclosed. Through this, the members of the supply chain can see the impacts of their decisions on the entire supply chain and the ways to optimise it. Despite the different ERP systems along the supply chain, order processing can be carried out smoothly via the “myOpenFactory ”. Working with real software and hardware makes the logistics demonstrator unique compared to other demonstrators that usually work only with virtual simulations. Traceability of material flows through the use of RFID tags at the item level is possible any time. For that purpose the logistics demonstrator uses GS1 standards. Hereby the real-world challenge of worldwide zero overlapping identifiability is solved. The USB stick
blanks shipped by the supplier are distinguished with a standardized shipping label and a Serial Shipping Container Code (SSCC) on the package. After an automated receipt from the producer and a comparison with the dispatch notification electronically distributed prior to shipping, the blanks are engraved with laser lettering and refined
with customized documents on the stick. In this specific example the products are provided with a serialized item number that uniquely identifies the product through the following process flow. This serialized item number stored on both the RFID tag and in a GS1 Data Matrix allows for a clear assignment and traceability of products and shipment units. In this way the serialized item number can be used to match orders with deliveries and to support stock piling and removal with the aid of pick-by-voice solutions.

The demonstrator shows how processes can be made more efficient. This enables companies to quickly access information and to respond to problems such as the threat of delivery delay. The impacts of a 20%-increase in orders from a merchant can become directly visible to all participants. The combination of horizontal and vertical
integration makes it possible for all the players to adapt themselves to changes in the ordering behaviour of the
customer or other changes. This case of an USB stick production can also be applied to other industries.