Monday, November 2, 2015
Bottlenecks. Those are the clogs, the hang-ups or the choke-points which are problems for any business. Companies in the growing liquid recycling industry, which vary tremendously by size, scope and sector, are no different. In order to improve operations all companies must properly deal with their bottlenecks. Identifying the bottleneck itself is a critical first step because it is costing the operation money. Once identified a communication system is essential for delivering important information that can improve both work flow and profitability.
Bottlenecks, as defined by Eliyahu M. Goldratt in the classic business novel “The Goal”, are resources that have a total capacity equal to or less than the demand placed on them. Based on this idea the flow of operations in any system is dictated by the bottleneck resources in that system. Manage your bottleneck resources well and profitability increases. But failing to manage bottleneck resources is costly. One conclusion from Goldratt’s rationale is that a slowdown of one hour at a bottleneck is really the same as the cost of operating the entire system for one hour.
Monitoring Systems: Critical to Managing Operations
Let’s look at an example involving a lube and oil company which as part of its operations stores used motor oil in tanks until it can be moved to a recycling center. Let’s further suppose that the business is running a special offer for oil changes that resulted in a huge increase in demand from customers.
The promotion was successful – for a while. The resulting steady stream of oil changes also quickly filled the recycling tanks to capacity. But no one at the business noticed because the person assigned to visually check whether the tanks were full was busy with oil changes. Unfortunately the tank overflowed and spilling used oil onto the ground. The operation ground to a halt until a hazardous waste clean-up could be completed.
The consequences of failing to have an adequate system in place to constantly monitor the volume in the holding tanks were significant for this business. There were unhappy customers and lost revenue from oil changes that did not occur. There were idle resources behind the bottleneck until the recycling tanks were serviced. There was additional expense for lawyers and fines to deal with the spill.
The example illustrates why all businesses need methods to make sure the resources in their systems run in sync with one another. That means getting the best information possible about what is going on at the bottlenecks. In this case liquid level monitoring systems that utilize technology to provide critical information about on-going operations would have the effect of increasing the system’s overall capacity while avoiding unnecessary expenses and lost revenue.
Enevo: Using Technology to Optimize Liquid Level Monitoring
Enevo is a liquid level monitoring service that utilizes self-contained ultrasonic monitors and 2G/3G cellular communication to relay real-time information for tanks up to 157 inches deep. The system dashboard not only displays current fill levels but generates estimates on when tanks will be full or empty based on historical data. Alerts are generated and prioritized for urgent action, even for sudden increases or decreases in liquid level capacity. Enevo is a solution for businesses with multiple locations that seek to optimize their collection and distribution by replacing static “milk run” routing with data-driven route plans. This system minimizes total cost over time, builds accurate forecasts for future planning and dynamically re-calculates when changes take place.
A process of ongoing improvement requires identifying system constraints and dealing with them as effectively as possible. Until the weakest link is found and fixed, no real improvement can take place within the system. Implement communication tools to manage your bottlenecks, improve your flow of operations to meet demand and raise the profitability of your business.