Scholarly article on topic 'Performance Measurement for Robust and Agile Scheduling and Control of Industrial Product-Service Systems'

Performance Measurement for Robust and Agile Scheduling and Control of Industrial Product-Service Systems Academic research paper on "Materials engineering"

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Abstract of research paper on Materials engineering, author of scientific article — Friedrich Morlock, Thomas Dorka, Horst Meier

Abstract In the manufacturing industry competitors are continuously struggling to differentiate from other companies in the market. Industrial Product- Service Systems (IPS2) offer this differentiation by representing a paradigm shift from traditional product selling and service offering to providing customer value. To support the IPS2 provider during the delivery and use phase of IPS2 an IPS2-Execution System (IPS2-ES) has been developed. The system is needed for planning, scheduling and organization of the required delivery processes and the partner network. In addition to that, a performance measurement method for IPS2 (IPS2-PMM) supports the IPS2 provider with an evaluation of the IPS2 delivery through key performance indicators (KPI). For the holistic agile scheduling and control for IPS2 delivery, an IPS2 control model has been developed. However, to add robustness for the IPS2 delivery, the IPS2-PMM has to be integrated into this model. In this paper, the IPS2 control model is extended to allow for an integration of the IPS2-PMM. Thus, the cascaded control loops are enriched by the generation of KPI for the evaluation of the IPS2 delivery.

Academic research paper on topic "Performance Measurement for Robust and Agile Scheduling and Control of Industrial Product-Service Systems"

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Procedia CIRP 19 (2014) 154 - 159

Robust Manufacturing Conference (RoMaC 2014)

Performance Measurement for Robust and Agile Scheduling and Control of

Industrial Product-Service Systems

Friedrich Morlocka*, Thomas Dorkaa, Horst Meiera

aRuhr-Universität Bochum, Chair of Production Systems, Universitätsstrasse 150, 44801 Bochum, Germany * Corresponding author. Tel.: +49 234 32 29890; fax: +49 234 32 09890. E-mail address:morlock@lps.rub.de

Abstract

In the manufacturing industry competitors are continuously struggling to differentiate from other companies in the market. Industrial Product-Service Systems (IPS2) offer this differentiation by representing a paradigm shift from traditional product selling and service offering to providing customer value. To support the IPS2 provider during the delivery and use phase of IPS2 an IPS2-Execution System (IPS2-ES) has been developed. The system is needed for planning, scheduling and organization of the required delivery processes and the partner network. In addition to that, a performance measurement method for IPS2 (IPS2-PMM) supports the IPS2 provider with an evaluation of the IPS2 delivery through key performance indicators (KPI). For the holistic agile scheduling and control for IPS2 delivery, an IPS2 control model has been developed. However, to add robustness for the IPS2 delivery, the IPS2-PMM has to be integrated into this model. In this paper, the IPS2 control model is extended to allow for an integration of the IPS2-PMM. Thus, the cascaded control loops are enriched by the generation of KPI for the evaluation of the IPS2 delivery.

© 2014 ElsevierB.V.Thisisanopenaccessarticle under the CC BY-NC-ND license (http://creativecommons.org/licenses/by-nc-nd/3.0/).

Selectionand peer-review underresponsibility of the International Scientific Committee of "RoMaC 2014" in the person of the Conference Chair Prof. Dr.-Ing. Katja Windt.

Keywords: Industrial Product-Service Systems, Performance Measurement, Agile Scheduling and Control, Organization

1. Introduction

During the last years, research and industry have focused on product-service systems (PSS) [1-3]. Because of the high competition among industry companies, it is important for the competitors to differentiate from each other. Industrial product-service systems (IPS2), which are defined by [4] as „characterized by the integrated and mutually determined planning, development, provision and use of product and service shares including its immanent software components in Business-to-Business applications and represent[ing] a knowledge-intensive socio-technical system", offer a solution for integrated products and services. The relevant business models can either be function-, ability- or result-orientated [3] or range in the continuum between these models [5]. Scientific research on the topic IPS2 lifecycle shows that there are five phases to be considered: planning, development, implementation, delivery and use, and closure [6].

Due to the complexity of offering IPS2, several different competences and resources for the delivery of IPS2 are needed. An IPS2 provider cannot necessarily provide all these resources. Therefore, a network of partners is created to provide missing resources. The planning of the network partners' resources and the management of the network itself is a highly complex task. Hence, a special software tool, the IPS2-Execution System (IPS2-ES), can be used to support the provider during the delivery and use phase in the crucial tasks of organizing the delivery processes and planning the resources.

For an effective and efficient IPS2 delivery a performance measurement method is needed [7], especially in industrial applications to offer profitable IPS2 [8]. The IPS2 performance measurement method (IPS2-PMM) delivers information and KPI for the IPS2 planner and provides support in the evaluation of the resource planning, the IPS2 network and the IT system.

2212-8271 © 2014 Elsevier B.V. This is an open access article under the CC BY-NC-ND license (http://creativecommons.Org/licenses/by-nc-nd/3.0/).

Selection and peer-review under responsibility of the International Scientific Committee of "RoMaC 2014" in the person of the Conference

Chair Prof. Dr.-Ing. Katja Windt.

doi:10.1016/j.procir.2014.05.006

To calculate KPI data from the delivery phase is necessary.

In this paper, the IPS2-PMM will be integrated into the already existing IPS2 control model. However, to be able to do so, the model has to be enhanced to clarify how the IPS2-PMM can be used for the tactical management.

2. State of the Art

To understand how the IPS2 performance measurement method works in conjunction with the IPS2 control model, basic knowledge on the delivery of IPS2 is provided in the following sections. Also, the IPS2-PMM is introduced, basics on an IPS2 control system are presented and an existing approach for an IPS2 control model is shown.

2.1. Delivery of IPS2 with an IPS2-Execution System

Many suppliers are necessary to provide all required resources for the delivery. This leads to the development of IPS2 networks, which consist of the IPS2 provider and customer as well as IPS2 module suppliers, component suppliers and service suppliers [9]. The partners form a virtual organization, which is considered as the most suitable organization type by [10]. Each partner is represented by one or more virtual organization units and makes some of its resources available for the delivery of the providers' IPS2 [11].

The different virtual organization units and their resources have to be planned and multiple delivery processes (e.g. maintenance processes or training events), which are defined in the IPS2 product model, have to be scheduled. This is done by means of adaptive IPS2 planning, resulting in a delivery plan. While strategic capacity planning leads to a delivery plan that includes the designated processes for each IPS2 in the product model, the operational resource planning integrates unexpected and therefore unscheduled processes into an existing delivery plan.

In the complex task of organizing the IPS2 delivery, including scheduling and integration of the resources of network partners, the IPS2 provider is supported by an IPS2-ES. It is defined by [12] as „the essential software system for the IPS2 operation phase that supports the IPS2 provider in the provision of customer value by adaptive IPS2 delivery planning, IPS2 network management and an integrated performance measurement method.". Thus, an IPS2-ES takes over the strategic capacity planning as well as the operational resource planning while using resources from the IPS2 network. The system works highly automatic by modifying the delivery plan and integrating new network partners whenever needed. However, the user can change the system's behavior manually at any time.

2.2. Performance Measurement for IPS2

Traditional indicator systems are the predecessors of performance measurement (PM) [13-16]. While indicator systems are considering the past, PM is future- and process-oriented [17]. Hence, PM supports decision making and not only monitoring and measuring. It is highly complex, under

permanent development [13, 14] and used in different sectors (e.g. supply chain management [14], Service [13] or IT [18]). Therefore, no common definition of PM can be found in the literature. Nevertheless, it is often mentioned that PM should control and improve efficiency and effectiveness with the focus on strategic issues.

A PM approach for IPS2 is developed by [19]. The considered instrument of PM for IPS2 is the classic balanced scorecard by [20] with the focus on strategic issues and extended by a relationship perspective. The extension is necessary in order to meet the organization as a virtual network, which requires trustful interactions between the partners.

For the PM of the IPS2 delivery a new method has been developed. The main target of the IPS2 performance measurement method (IPS2-PMM) is to support the IPS2 planer during the IPS2 delivery and to make sure that the targeted effect of the IPS2-ES is reached. According to the understanding of the IPS2-ES, the main tasks during the IPS2 delivery are the delivery planning and the network management. Due to the fact that the IPS2-ES is a software tool the IT and software components of the system have to be considered, too. [7]

In summary, this leads to the conclusion that the IPS2-PMM has to consider the three evaluation fields resource planning, network and IT system for an effective and efficient IPS2 delivery [7]. Fig. 1 shows how an IPS2 planner can use the KPI generated by the IPS2-PMM to either control the IPS2 delivery via the IPS2-ES or report to the tactical management so that either the IPS2 model can be changed or the network of partners can be altered.

Tactical Level

Reporting

IPS2 Planner

Fig. 1. Performance Measurement Method based on [7].

For evaluation purposes key figures can be used. Many key figures can be found in the service sector [21]. However, the selection of the set of key figures is company specific [22]. Therefore, a specific target system for every IPS2 is needed [7, 23]. Nevertheless, due to the fact that the delivery planning for IPS2 follows a centralized approach, the target system for the planning has to integrate the requirements from each IPS2 as well as the interests of the IPS2 provider. Examples of important key figures for the IPS2 delivery and their calculation are presented in [8, 24-26].

For IPS2-PMM a distinction between planning and delivery key figures is necessary, so that the sectors planning and network can be considered separately [24]. This decision is necessary so that the planner can distinguish whether a bad performance during the IPS2 delivery is caused by the

planning or the delivery by the network partners. Planning key figures like the resource utilization or the rescheduling quota objectively express the performance of the delivery plan. Delivery key figures like process stability, which shows the deviation of operating times of delivery processes from their target times, evaluate the performance of the network partners. Therefore, delivery key figures can only be used for the evaluation of IPS2 network partners.

The virtual organization approach for IPS2 and the IPS2 delivery planning constitute additional requirements for IPS2 network partners to cooperate with an IPS2-ES. The real-time delivery planning with virtual organization units continuously needs up-to-date and valid resource data from the network partners. The ability to provide this data can be indirectly measured inside the IPS2-ES by the ratio of accepted delivery plans and the reaction time until a delivery plan is accepted. These key figures play a major role in the evaluation of network partners in the IPS2 PMM. Concerning the IT-system behavior of the IPS2-ES the question arises whether used services affect the functionality of the IPS2-ES. Therefore, proper key figures like answer times or availability of services are implemented, to determine whether internal or external services are suitable for the use with the IPS2-ES [7].

2.3. IPS2 Control System

Condition monitoring systems have proven valuable in production through their benefits, which are described in [27] and [28]. For several years research has been conducted to transfer the benefits of condition monitoring to services and IPS2. Another advantage of this transfer is that the automation of services can be supported by such a system [29, 30].

The challenge for a condition monitoring system for IPS2 manifests in the support of service technicians throughout the service delivery. Agent approaches have proven valuable in this field [29]. An agent system is characterized by a computational organization with different roles [31].

In a condition monitoring system for IPS2, called IPS2 control system (IPS2-CS), roles such as service technicians or machines are represented as agents that communicate with each other. Thus, an exchange between the agents arises for the automation of IPS2 [29].

2.4. IPS2 Control Model

During the operation of IPS2 the IPS2-CS is connected to the IPS2-ES to enable agile scheduling and control for the IPS2 delivery. The interfaces between these systems allows for the adjustment of the delivery plan according to the requirements detected by the IPS2-CS, i.e. the occurrence of unplanned demands [32].

For example, the malfunction of a machine tool can be predicted by the IPS2-CS. The IPS2-CS can then inform the IPS2-ES so that a delivery process for the exchange of the tool can be requested proactively.

The agile scheduling and control model as a feedback loop presented in [32] is the foundation on which the extension shown in this paper is based. The feedback loop allows for

reaction to problems during the IPS2 delivery on multiple levels.

3. Performance Measurement for Robust and Agile Scheduling and Control of Industrial Product-Service Systems

As described before, the IPS2-PMM is used during the delivery of IPS2. However, to understand the relevance of the IPS2-PMM in the context of the agile scheduling and control of IPS2, the data collection and processing by the IPS2-PMM has to be further explained. The date collection is closely connected to the IPS2-CS, as described in the following section.

3.1. Interaction between IPS2 Performance Measurement and IPS2 Control System

As described in the State of the Art, a performance measurement method has been developed for the IPS2 delivery. From the three evaluation fields considered by the IPS2-PMM, only one - the IPS2 network evaluation - requires data that does not originate from the IPS2-ES, i.e. from external systems. For the evaluation of the network, feedback concerning the delivery performance is required. An example for a KPI that can be derived is On Time Delivery (OTD). Here, the actual completion date of an executed delivery process can be used to determine whether the process was delivered on time by the responsible network partners. Further examples for KPI are First Time Fix (FTF) and Process Stability. The data that is needed by the IPS2-PMM can be supplied by a service monitoring system such as the IPS2-CS described above.

IPS2 Execution System

^^Control System

Process feedback

Delivery Process ID Process Start Date

Performance

Measurement Method

First Time Fix On Time Delivery

Fig. 2. Process of KPI calculation with the IPS2-PMM

Fig. 2 illustrates the process of the calculation of the KPI with the IPS2-PMM. The IPS2-CS is aware of the planned delivery processes for a specific IPS2. Hence, it can provide feedback about a recently completed process via a ReST-based web service (see [33]) to the IPS2-PMM. The delivery process feedback data, as described in [34], contains information about the IPS2, at which the delivery process was executed, the delivery process ID, so it can be uniquely identified, the process start and end time and date, the numbers of errors during the process execution and whether the process was aborted or not. The IPS2-PMM matches the incoming data with the delivery plan created by the IPS2-ES to identify deviations of the delivery. Based on the results, the different KPI are created.

Process request Delivery Plan

Product model, provider network business model Incl. target values planning weights

Process Feedback

Fig. 3. Enhanced specification of the Operational Level

The data that is collected by the IPS2-PMM originates from the operational level of the IPS2-Control Model. However, the current version of the model does not reflect this directly, but only defines the output of the operational level as "IPS2 operation". Hence, the model can be changed to specify the output of the operational level for the IPS2-PMM more clearly.

3.2. Enhanced Specification of the Operational Level of the IPS2 Control Model

Looking at the operational level as described in [32], the input and output values have to be enriched to allow an integration of the IPS2-PMM. First of all, the input of the operational level includes not only IPS2 target values, as in the original model, but also information about the IPS2 product model, the provider network, the business model and weights for the IPS2 adaptive planning algorithm used in the IPS2-ES. This information is needed by the IPS2-ES to be able to integrate the resources of network partners and to generate delivery plans.

Secondly, the original output of the operational level of the IPS2 control model, named as "IPS2 operation" does not sufficiently describe what is achieved by the delivery of the IPS2 from an operational view. First of all, the operational level as the manifestation of the IPS2 during the delivery phase represents more than just the IPS2 operation. In fact, it is the base on which the actual customer value is generated. However, since this only reflects the customer side of the output, the IPS2 operation effect that is relevant for the IPS2 provider has to be considered as well. Thus, the output of the IPS2 can be extended by provider effectiveness and efficiency. While many parameters are relevant to determine the provider effectiveness and efficiency, e.g. for controlling or risk management (see for example [35]), the

Engineering objectives

IPS2 strategic goals

Customer needs and requirements

Tactical Management

particular parameters used for the IPS2-PMM can be specified in the model. These are mainly the delivery plan produced by the IPS2-ES, which might be triggered by a process request by the IPS2-CS, and the process feedback generated by the IPS2-CS based on the values it has measured. The enhanced operational level is depicted in Fig. 3.

After specifying the operational level with a higher detail, the IPS2-PMM can be included into the control model. Due to the fact that the IPS2-PMM generates KPI for the interpretation on a tactical level, the lifecycle level of the IPS2 control model has to be split into a tactical an a strategic level.

3.3. Development of the Tactical Aspect of the Lifecycle Level

The lifecycle level of the original IPS2 control model is described as a closed loop control with the controller "IPS2 Development", the actuator "Business Model" and the measuring unit "Marketing". This construct is too generic to describe the integration of the IPS2-PMM in the IPS2 control model. Hence, the lifecycle level is replaced by two new levels: the strategic level and the tactical level.

The tactical level can be described as a closed loop control that represents the possibilities of the IPS2 planner to influence the IPS2 delivery based on the IPS2-PMM as presented in [7]. However, due to the complex goal of the IPS2 provider of controlling customer value while being efficient and effective in the IPS2 delivery, several mechanisms on the tactical level have to be in effect to provide means to reach the goal. In this paper, we focus solely on the tactical level from a provider perspective that

Product model, provider network, business model incl. target values, planning weights

Engineering

Operational Level

IPS2 Performance Measurement

Customer value

Provider effectiveness and efficiency

IPS2-KPI

Fig. 4. Tactical Level of the IPS2 Control Model

Strategic Level

Tactical Level

Operation Level

• Customer needs

• Shareholder needs

• etc.

• Product model

• provider network

• business model incl.target values

• planning weights

Fig. 5. Revised Version of the IPS2 Control Model

ensures efficient and effective IPS2 operation. The various other mechanisms still have to be identified. The tactical level as a closed loop control from the provider perspective (see Fig. 4) can be described as follows: The goals that are set by the strategic level of the IPS2 provider and the needs and requirements of the IPS2 customer. A tactical management (controller) defines the engineering objectives for the engineering of the IPS2 (actuator). The output of the engineering then becomes the input for the operational level and consists of the IPS2 product model, the provider network, planning weights and the business model including its target values, as mentioned above. The output of the operational level, i.e. customer value as well as provider effectiveness and efficiency, is then measured by the IPS2-PMM (measuring unit).

The KPI generated by the IPS2-PMM can then be used by the tactical management to steer the engineering to provide adapted IPS2 product models, provider networks and business models for the operation phase. Executing this control loop continuously allows for optimization of the IPS2 provision from a tactical perspective. However, additional IPS2 or changed customer requirements, and hence expected customer value, can influence the loop and induce new control iterations. After defining the tactical level of the IPS2 control model, the model as a whole can be put together. It can serve as a cascaded control loop to optimize the delivery of IPS2.

3.4. Integration of the Advancements into the Control Model

Fig. 5 shows the integration of the IPS2-PMM into the IPS2 control model. The process level and the effect level have been omitted for simplicity. However, their existence is vital for the functionality of the model as a whole. The lifecycle level of the original model was replaced by two new levels: tactical and strategic. In this paper, the strategic

level will not be defined, yet. Hence, it will be considered as a "black box" until further research is conducted on how a closed loop control from a strategic standpoint works.

Customer and shareholder needs are the foundation on which the strategic focus of the IPS2 provider is based to be efficient and effective while providing the customer with its required value. Therefore, the strategic goals and the customer requirements can serve as an input for the tactical level to steer the engineering of IPS2 and the connected business models with the support of a network of partners. Again, these activities are executed with the aim of being efficient and effective while providing customer value. The IPS2 product models, the partner network and the business models serve as the basis for the three bottommost levels, on which the operational activities are executed: operational level, process level and effect level. The overall aim still remains the same, even for these three levels.

On each level, the output of the controlled system is measured to provide input for the control mechanism. The IPS2-PMM is located on the tactical level and measures the IPS2 operation to provide input on how efficient and effective the IPS2 delivery is executed on the operational level. It does so by using the outputs of the operational level. Hence, it provides a valuable input for the tactical management. However, it has to be noted that other measuring units may possibly be put into effect to provide the information needed by the tactical management.

The model has been evaluated in a practical use case for micro milling inside the Collaborative Research Center Transregio 29.

4. Conclusion and Outlook

In this paper the IPS2 control model was revised and improved by the integration of the IPS2 performance measurement method. While integrating the IPS2-PMM, the need for a strategic and a tactical level in the model raised

and the tactical level, in which the IPS2-PMM can be located, was described. The model can serve as a general picture to understand the dynamic feedback that is used throughout the IPS2 lifecycle to achieve the provision of customer value while being and effective and efficient IPS2 provider. The findings of the practical evaluation have yet to be published.

However, some fields of research are still open. The control loop from a strategic perspective has to be defined and the consistency with the other four levels checked. Also, the measuring units on tactical and strategic levels have to be examined to determine which measuring units are required and what output they have to produce to provide the input for the control of the related level.

Acknowledgements

We express our sincere thanks to the German Research Foundation (Deutsche Forschungsgemeinschaft, DFG) for financing this study within the Collaborative Research Center Transregio 29 (CRC/TR 29) on Industrial Product-Service Systems - dynamic interdependencies between products and services in the production area.

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