Case Study: Master Scheduling Optimization for HDPE Pipe Manufacturing in Egypt

Company Overview: A leading HDPE pipe manufacturer in Egypt serves irrigation, sewage, and gas distribution projects. The company operates three extrusion lines and employs 120 workers across three shifts. Each line produces pipes of specific diameters, with capacities as follows:

Problem Statement:

In Q4, the company faced a demand surge due to two simultaneous government projects:

1. Irrigation Project: Required 250 tons of 450mm pipes within four weeks.
2. Sewage System Expansion: Needed 150 tons of 125mm pipes within six weeks.

Additionally, the seasonal demand for 20mm pipes increased by 25%, adding further pressure on Line 1, already operating at high utilization.

Challenges Identified:

Capacity Constraints:

Line 3’s daily capacity of 25 tons was insufficient to meet the irrigation project’s tight timeline.

Line 2 was nearing full utilization, limiting flexibility for the sewage project.

Production Costs:

Frequent changeovers between pipe sizes increased operational costs and downtime.

Resource Limitations:

Scheduled maintenance for Line 2 during this period further reduced capacity.

Limited availability of skilled labor for extended shifts impacted potential output increases.

Master Scheduling Actions Taken:

1. Periodic Review Implementation:

The company adopted weekly reviews to align production schedules with demand fluctuations.

Key updates included:

• Prioritization: Allocated Line 3’s capacity to 450mm pipes for the irrigation project.
• Batch Adjustments: Consolidated production batches for smaller pipe diameters on Line 1 to reduce setup times.

2. Timely Transaction Processing:

• Inventory Control: Implemented RFID tracking to ensure raw material availability for high-demand pipes.
• Real-Time Adjustments: ERP systems were used to instantly adjust schedules based on incoming orders.

3. Capacity Management:

• Overtime Scheduling: Extended night shifts to maximize output on Lines 2 and 3.
• Load Redistribution: Deferred non-critical maintenance for Line 2 and temporarily shifted some production to Line 1.
• Subcontracting: Outsourced threading and finishing of 125mm pipes to meet delivery timelines.

Results Achieved:

Detailed Numerical Breakdown:

Production Plan Adjustments:

Irrigation Project (450mm Pipes):

• Required: 250 tons.
• Line 3 adjusted to produce 28 tons/day (112% utilization with overtime), completing the project in 9 days.

Sewage Project (125mm Pipes):

• Required: 150 tons.
• Line 2 dedicated to 125mm pipes, producing 15 tons/day. Output completed in 10 days.

20mm Pipes (Seasonal Demand):

• Previous output: 6 tons/day.
• Increased capacity by 20% on Line 1 to 7.2 tons/day, addressing seasonal demand while maintaining regular supply.

Resource Optimization:

• Material Utilization: Reduced raw material scrap rates by 8%, saving EGP 120,000 in material costs.
• Energy Savings: Produced similar pipe sizes consecutively, reducing extrusion energy costs by 10%, equivalent to EGP 90,000.
• Labor Efficiency: Trained 15 workers for multi-shift roles, reducing dependency on extended overtime.

Cost Savings and ROI:

Savings Achieved:

Energy Costs:

• Average energy cost per ton: EGP 1,200.
• 10% reduction → Savings: EGP 120/ton × 400 tons = EGP 48,000.

Labor Optimization:

• Reduced reliance on overtime through efficient shift management.
• Savings: EGP 70,000 over four weeks.

Production Costs:

• Improved changeover efficiency reduced operational costs by EGP 0.4 million.

Total Savings: EGP 518,000

Key Takeaways for Industry Benchmarking:

1. Regular Reviews: Weekly master schedule reviews are essential to adapt quickly to demand changes.
2. Invest in Technology: RFID and ERP systems provide real-time data for informed decision-making.
3. Maximize Flexibility: Cross-train workers and maintain buffer capacities for unexpected demand.
4. Streamline Operations: Reduce changeover times by grouping similar production batches.
5. Collaborate Strategically: Subcontract non-core processes during peak periods to manage constraints.

Conclusion:

This case study demonstrates how optimized master scheduling enabled this HDPE pipe manufacturer to overcome capacity constraints, meet tight deadlines, and improve cost efficiency. The strategies implemented serve as a benchmark for similar industries in Egypt to achieve operational excellence.