National Cranberry Cooperative

Problems with NCC
• Overtime costs
• Truck waiting
• Wet harvesting becoming more common than dry harvesting
• Even more overtime and truck waiting problems in the future

OIE 500 – Analyzing And Designing Operation To
Create Value; Walter T. Towner 2014

Process flow chart

OIE 500 – Analyzing And Designing Operation To
Create Value; Walter T. Towner 2014

Bottleneck and overtime hours
• On peak days can expect 18,879 bbls
• Wet berries → 0.7*18,879 = 13,215 bbls/day
• Wet berry process time → total bbls/dryer capacity → 13,215 bbls/600 bbls/hr = 22 hours
• Dry berries process time → 5,664 bbls/600 bbls/hr =9.44 hours • Buying an extra dryer for $60,000 increases dryer capacity from 600 to 800 bbls/hr
• New wet berries process time → 13,215/800 =16.5 hours
• New dry berries process time → 5,664/400 = 14.2 hours
• Reduces bottleneck by 22-16.5 = 5.5 hours
• Saves 5.5 hours of overtime on peak days

OIE 500 – Analyzing And Designing Operation To
Create Value; Walter T. Towner 2014

What if we added another dryer?
• Dryer processing capacity increases to 1000 bbls/day
• Wet berries process time → 13,215/1000 = 13.2 hours
• Dry berries process time → 13.2 hours + (5,664-13.2*200)/1200 = 15.9 hours

• The dry berry processing time becomes new bottleneck
• Limits benefit of second dryer 16.2-15.9 = 0.3 hours reduction in process time
• Need to increase separator capacity to realize full 3 hour reduction in process time from a 2nd dryer

• Second dryer not worth the investment

OIE 500 – Analyzing And Designing Operation To
Create Value; Walter T. Towner 2014

How does alleviating dryer bottleneck impact truck waiting
times?
• Inventory builds up in bins at a rate of 18,879 bbls*0.7/12 hours – 600 bbls/hour = 501 bbls/hour
• When last truck arrives at 7pm
• There is 501 bbls/hr*12 hours = 6,012 barrels of inventory must be processed
• Bins can only hold 3,200 bbls
• 6,012-3,200 = 2,812 bbls must remain in trucks
• 2,812 bbls/75 bbls/truck = 38 trucks sit idle

• By adding extra dryer they can process 800 bbls/hr
• Inventory build up is reduced to 18,879*0.7/12 – 800 = 301 bbls/hr • 301*12 hrs = 3,612bbls of inventory remaining
• Bins hold 3,200
• 3,612-3,200 = 412 bbls remaining in trucks
• Only 412/75 = 6 trucks remaining idle compared to 38

OIE 500 – Analyzing And Designing Operation To
Create Value; Walter T. Towner 2014

Increasing max no. of wet bins should alleviate remaining idle time
• One bin holds 250 bbls
• Adding 2 bins increases holding capacity by 500 bbls which is more than enough to hold remaining 415 bbls of inventory build up calculated in previous slide

• Truck idle time at the dumper completely eliminated
• By buying one extra dryer and converting two dry bins to wet bins

• Dryer reduces bulk of overtime cost ( approximately 25% reduction) • Remaining overtime cost can be eliminated by scheduling

OIE 500 – Analyzing And Designing Operation To Create Value; Walter T. Towner 2014

Questions?

OIE 500 – Analyzing And Designing Operation To
Create Value; Walter T. Towner 2014