management concepts. Section 4 - WIT Press€¦ · we refer a.o. to the models of Boehm [3] and Cavano & McCall [6]. For ... Quality management and lot traceability issues in food

Key quality characteristics of logistic

information systems in changing business

environments

J.H. Trienekens, C. Meijs

Department of Management Studies, and Department of

Computer Science, Wageningen Agricultural University,

Hollandseweg 1, 6706 KN Wageningen, The Netherlands

Abstract

Business environments are changing fast. Quality characteristics of logisticinformation systems must be related to new management concepts andinformation technology opportunities. They must not only refer to softwa-re, but also to organisational procedures and to interfaces with othersystems. New generations of logistic information systems must especiallyfocus at flexibility and integration.

1 Introduction

The logistic manager in many companies has to cope with higher qualitydemands on products, shorter product life cycles, broader assortments ofproducts and improved delivery conditions to customers. To deal withthese challenges new management concepts and new information technolo-gy are available. In this paper, key quality characteristics of new genera-tions of logistic information systems are analysed in relation to productionmanagement concepts and information technology (see figure 1).

Several practical investigations regarding information systems,inter-company collaboration and evolution in the market of logisticinformation systems were carried out on behalf of our project. Our casewas the food processing industry. In our study of quality characteristics,we refer a.o. to the models of Boehm [3] and Cavano & McCall [6]. Forthe analysis of logistic information systems we refer to Bertrand [2].In section 2 we will describe the main characteristics of and the mostimportant developments in the food processing industry, taken as oursubject. Section 3 gives an overview of evolutions in production

Transactions on Information and Communications Technologies vol 11, © 1995 WIT Press, www.witpress.com, ISSN 1743-3517

148 Software Quality Management

management concepts. Section 4deals with information techno-logy opportunities for logistics.Section 5 describes a qualityframework for logistic informa-tion systems. Section 6 con-cludes the paper.

Managementconcepts

Figure 1: research concept

2 Food processing industries

The food processing industry is one of the most important branches ofindustry in the European Economic Community (EEC), (Eurostat Industri-al Yearbook [5]). This is reflected by the share of this industry in thegross value added of industrial production that is more than 10% in thecountries of the EEC; in the Netherlands more than 17%. Typical pro-ducts in the food processing industry are canned food, dairy products,beverage products, meat products, fish products, and many more.

2.1 Important characteristics: quality variations andcomplex process structuresAn important characteristic governing the supply of raw materials is theoverall variation in quality (composition, age, taste, form, color). This ismainly caused by weather conditions and because of the impossibility ofstandardising live produce. A characteristic strongly related to qualityaspects is perishability which applies to most produce (e.g. vegetables,fruit, meat); quality also varies in time. The fact that raw produce isperishable and subject to quality variations, means, it either has to beprocessed directly after arrival at the company, or special storing facilities(e.g. freezing and cooling facilities) have to be available. This makes thestoring and handling of produce for these industries rather complex andyields in production processes often uncertain (Trienekens [11]).

A major characteristic in the production process of food industries isthe production of by-products. By-products result from the productionprocesses and have to be sold as well (e.g. cheese and whey; butter andbuttermilk). A complexity increasing factor related to this subject is thatfood processing industries produce in general a large variety of varying


Software Quality Management 149

recipes (if the composition of an ingredient changes, the amounts of theother ingredients has to change as well). Because of the high complexityof many processes and because machine-capacities are relative expensivein these companies, management of capacities is often just as important asmanagement of the product flow (Trienekens [11]).

2.2 Changing business environments: evolving customerrelationshipsCurrently, many changes are taking place in the area of food production.Important developments are the higher customer demands with regard toproduct quality (growing health and growing environmental conscious-ness!), the assortment of end-products and the length of the product lifecycle. Strongly related to these issues, we see in the food industry anemerging role for the packing industry; often one food product can beobtained in many different packages depending on the wishes of thecustomer. Another important issue with regard to customer-relationships isthe time and quantity of sales in the short run becoming more and moreunpredictable for many companies. This is caused by the policy of chainstores and the unpredictable behaviour of consumers and new markets.

These developments lead from a business internal viewpoint to:more attention to customers demands and expectations, higher orientationtowards quality control and environmental issues, and a shift from theproduction of bulk towards the production of specialities. From a businessexternal viewpoint we notice developments towards collaboration withimportant suppliers and customers, sometimes leading to collaboration inso-called product chains (Meijs & Trienekens [7]), the increasing impor-tance of a solid distribution system and concentration of companies at EC-level.

3 Developments in production management concepts

3.1 Traditional concepts: Manufacturing resource planningMost traditional production systems are based on Manufacturing ResourcePlanning (MRP) (Bertrand [2]). MRP integrates supply, demand and pro-duction planning functions. Major modules of MRP are the long-term(often 1 month or more) production planning module and the materialsrequirements planning module. For long term production planning a solidforecast of market demands is essential. Given the long term productionplan, the requirements of materials for different points of time in theproduction process are computed on the basis of a Bill of Material. Thebill of material describes the components structure of the product. Fromthis a production plan proceeds: the system produces work-orders to betaken into production at shop-floor level.

The concept has been developed for industries with discrete



manufacturing processes (v. Rijn [10]). These industries produce mostlybulk products to stock (they sell products from stock). Major characteris-tics are:-a predictable supply of raw materials and demand of products,with regard to quality and quantity;-a convergent, fixed, product structure (BOM): one production processyields only one end-product, materials are fixed;-a planning orientation on products and materials.

From the characteristics and developments described in section 2,demands with regard to production planning in food industries can bededuced. Production planning concepts for food industries must be able tohandle:-a varying supply of raw materials and demand of products, with regard toquality and quantity;-a divergent, variable, product structure: one production process oftenyields several (by-)products; materials are dynamic and variable in nature;-a planning orientation on (machine-) capacities.

3.2 New directions: customer orientation, total quality

management and capacity planningAs a consequence of the increasing complexity of the choices to be madein managing the production processes in food industries, there is a gro-wing need to appropriate production management concepts. In recent yearswe have noticed a shift from MRP concepts to customer oriented conceptsbased on timely and flexible production, and concepts based on capacityoriented planning. At the same time new attention to quality issues leadsto the application of quality management concepts. The most importantconcept is Total Quality Management (TQM) by which customer demands,product quality and process quality are linked into an integrated qualitysystem.

-Customer order orientation.Important developments exist towards concepts that can handle differentso-called customer order decoupling points (Trienekens [11]). A customerorder decoupling point is the point in the production process from whichthe process starts after a customer-order has come in. For part of theproducts in food industries production to stock still holds. For an increa-sing amount of products however a major part of the production processonly starts after the customer order comes in. For these orders the 'just intime' (JIT) concept can be applied to, at least part of, the productionprocess. JIT is a short term production concept and is based on therequirements of customers and a philosophy of flexibility and respon-siveness. With JIT, a company produces only the products and compo-nents that are required by a customers order. The customers thereforedictate production by placing orders for the products. The object is to onlyreceive materials immediately prior to their use in the production process.



-Total Quality management.Total Quality management aims at the integral improvement of products,processes and production means (people) (Trienekens [12]). The relationof the company to the customer is of major importance. One of the keyissues of Total Quality Management (TQM) is the search for continuousquality improvement. People that are working together in teams oncontinuous product- and process improvements is a key issue in this con-cept. TQM therefore opts for more then just quantitative measurements ofend products or standardisation of processes (compare ISO 9000). Howe-ver, besides people improving the process, continuous and thoroughmeasurement of customers perceptions related to process and productquality remains important to achieve a secured quality system.

-Capacity oriented planning concepts.The most complex part of capacity planning takes place at the shop floorlevel in which actual production takes place. An important task for theshop-floor production manager is scheduling the work-orders. The basis ofthe schedule made is the production capacity available, with its constraintsand conditions. In food industries optimizing the production sequence andreduction of setup times are of key importance. Concepts of capacityplanning, often supported by electronic planning boards, are now moreand more used for optimisation of the workflow in food industries. Abetter planning of capacities can offer opportunities to a better and moreflexible response to customer orders.

The new concepts offer opportunities for food industries tobetter adjust their processes to customer demands. Flexibility, responsive-ness, customer oriented quality assurance and optimization of the work-flow are key notions in this context.

4 Information Technology opportunities for foodindustries

4.1 Logistic information systems for food industries: quali-ty management and lot traceabilityIn food processing industries production control and inventory controlmust deal with the variety and dynamics of the quality of the raw produceand semi-manufactures. Quality management therefore is a main topic infood processing industries. A sound quality control system is needed forthe registration of the process and the product information (e.g. composi-tion, storage time, history of products). Another important issue in foodprocessing industries is lot registration. It is important to know fromwhich lots the raw produce has been selected during the productionprocess. Traceability is a main topic in food processing industries.

Quality management and lot traceability issues in food industries are



now more and more linked to the total quality management concept, toachieve a quality assurance system which integrates product and processcharacteristics with the dynamics of customer demands. This leads to newdemands to logistic information systems.

4.2 Evolutions in the market of integral production

management systemsMost of the demands with regard to registration of process and productdata have been met in the ninetie's. A research project in The Netherlands(Moret Ernst & Young [9]) showed an increasing amount of softwarepackages suitable to food industries that support demands like lot-tracea-bility, management of recepies, quality administration, inventory managa-ment, etc.However, the same research showed less support for handling of variablerecepies, changeability of recepies, customer specific recepies, traceabilityof customer orders in the production process. Also less supported werefunctions like flexible customer order oriented production planning,adequate support of forecasting customer orders, capacity planning, andplanning on by-products. Customer orientation, marketing information anddecision support are the key issues here.

4.3 New opportunities in information technology:

framework for automated production managementIn a growing number of food industries, on every level of production newcomputerised information systems can be found, making the steps towardsimproved functions and internal and external integration of informationsystems. New information technology opportunities are very promising forthe future of logistic information systems.

A useful division of production management is a split into threelevels. On the highest level we find integration of management of purcha-sing, sales, inventory management and long-term production planning. Thelowest level is the level of process control. At this level production linesand machines are planned and controlled. Between these two there is athird level, the shop-floor. At this level we find functions like scheduling,process control, process registration and quality control.

On the highest level (integral production management) importantdevelopments in the area of information technology are an increase offunctionality (also section 4.2), database technology, 4GL, open systems,intercompany systems with EDI and PDI, graphical user-interfaces. Atshop floor level we now see introductions of computer networks for shopfloor control and an increasing use of product enclosed information (e.g.barcode). Also electronic planning boards have become available forsheduling tasks at this level; this has been made possible by the fast deve-lopments in information technology in recent years, such as high



[

Integral Productionmanagement

0 ft

Shop Floor Control

0 ft

Process controlProcess technology

N> Planning and^ Control data

Figure 2: framework for automatedproduction management

resolution screens and mouse con-trol. On the level of machinecontrol we see a developmentfrom relatively simple machinecontrol by PLC's (programmablelogic controllers) towards sophisti-cated distributed control systems,containing more functions andmore possibilities on behalf ofintegrative management of produc-tion lines.

These developments make itpossible that machine control canbe linked to shop floor control,which again can be linked tointegral production managementcontrol. In fact we see develop-ments towards Computer Integra-ted Manufacturing (CIM). CIM isthe integration of physical andinformation processing technology,throughout the company, andtherefore encompasses functionslike purchasing, production planning, production, quality control, sales,and marketing.

An example for a CIM-like architecture for food industries:Adequate forecasting and customer orders (e.g. via EDI) lead to a custo-mer orders sample. The subsequent production orders from the highestmanagement level are linked to the appropriate production method at theshop floor. The specific work methods are stored in a database togetherwith data concerning work-orders, products, recipes, processes, machine-capacities. By means of the computer network and a planning board theproduction manager can continuously manage the process which is control-led by operators who manage the production lines, supported by PC's thatare directy linked to machine control. Changes in customer orders can beplanned well at shop floor control level, supported by planning boards andcomputer networks. Data of machines and processes can be stored in adatabase and used as management information at different managementlevels.

The new information technology opportunities make a fast andadequate planning cycle in the companies possible. Because of this, fasterreactions to customer demands become possible. Integration of systemswithin the company and with systems of other companies makes thereforea faster but also more flexible reaction to customers orders possible.



Another advantage of these CIM-like developments is that product andprocess data can easy be obtained by different production levels and usedfor analysis objectives. These data can be very supportive for the use astools in total quality management (TQM). This to improve quality ofproducts and processes, as related to customer demands and perceptions.

5 Quality characteristics of logistic information systems

As has been described in the previous sections of this paper, customerorientation, total quality management and optimization of capacity-use areincreasingly supported by new management concepts and informationtechnology. This brings about new challenges and opportunities to develo-pers of logistic information systems.

5.1 Characteristics of logistic information systemsBertrand [2] describes four layers in logistic information systems:-the systems software;-state-independent transaction processing systems;-state-dependent transaction processing systems;-decision support and structured decision systems.The system software contains the application independent software, suchas the operating system, a database management system, 4GL, etc.The state-independent transaction processing systems constitute data thatare independent from the state of orders and materials in the goods flow tobe controlled. Examples are productstructures (bill of material, recipes),routings, capacity data. State-dependent transaction processing systemsconstitute data about the state of orders and materials in the goods flow.Examples here are orders, quality data, actual customers, etc. The fourthlayer supports human decision making: forecasting, production schedules,materials requirements planning, capacity planning.

We may conclude from the sections 2, 3 and 4 that in the foodindustry flexibility towards customer orders and markets, integration withother systems (business internal and external) and decision support functi-ons deserve special attention. Product and process registrations of theproduction process are in general well supported, as well as long-termscheduling and material planning functions (section 4.2). Importantimprovements must therefore take place in:-the systems software: flexibility in use and integration with other systems-the state-independent layer, e.g.: customer specific recipes, changeabilityof recipes, customer orientation in general;-the state-dependent layer, e.g.: quality control and customer ordersupport;-the decision support layer, e.g.: flexible production planning, capacityplanning, forecast support, planning on by-products.



5.2 Technical changes in logistic software systemsStandard software packages usually aim at a wide variety of indus-tries. In order to adapt the software to different businesses, the systemssoftware should provide facilities for the setting of variables with respectto the characteristics of data storage media and peripherals. Furthermorethe basic 1st layer may provide syntactical flexibility, so that the format-ting requirements for attributes can be adapted to the local requirements.

It is more difficult to change the semantics of software. This can beillustrated by the Entity Relationship diagram that is related to the secondand the third layer of the model. Decision support is for a large part basedon the constraints and conditions given by these two layers. Fig. 4 depictsthe extended data structure adapted from Bertrand [3].

by

Figure 3: data structure diagram

The major entities and their relationships are: Product that hasRecipes, Workorder defined for Product performed by Actual process,conducted with Capacity. The changing business environment may pressfor more flexibility, reflecting in e.g.:-a recursive relationship 'comprises' of Product, indicating that somenearly 'end-products' are engineered to customers specific requirements;-an n:m relationship between Process and Capacity (instead of an n:lrelationship);-an l:n relationship between Product and Recipe, indicating that recepiescan be adjusted to the taste and demands of the customer.

As we have described earlier, we believe that the concepts and theinformation technology for the challenges described above are available.However, this brings about important shifts in the attention to qualityattributes of logistic information systems for developers and users.



5.3 Quality modelIn order to compare quality in different business logistic situations, bothqualitatively and quantitatively, it is necessary to establish a model ofquality. Therefore we will introduce a model that is specialized forassesment of logistic information systems. In this reference model we willpay attention to the management (total quality management issues), thesoftware and the system perspective for relevant logistic situations.Some basic assumptions for the construction of this model are:-several perspectives of the involved organisational units and their peoplehave to be incorporated in the quality model. Logistic information systemsare often used in a distributed environment;-quality is relative, we may recognize trade-offs between different qualitycharacteristics.

-Quality model of Boehm and Cavano & McCall.Boehms's model was defined to provide a set of 'well-defined' charac-teristics of software quality (Boehm [3]). The model is hierarchical innature and the quality criteria are subdivided. The division is madeaccording to the uses made of the system and is an early attempt to bridgethe gap between the software engineers and users of information systems.Cavano & McCall [6] address three areas of software work: productoperation, product revision, and product transition. These two modelsshare a number of common characteristics arising from their hierarchicalnature and also from their origins in the computing culture of the 1970's.In literature severals other models for software quality attributes wereestablished; for the Netherlands we can refer to Deelen & Rijsenbrij [4]and Bemelmans [1]. Neither model claims to be universal or exclusive.For the logistic application area we will determine the relative importanceof these characteristics.

-Quality model of logistic information systems.Our quality model of a logistic information system comprises 3 majorelements. Besides the technical characteristics of the system (intrinsicsoftware quality), we distinguish the quality of organizational agreementsand rules, and the interactions of the system with consumers, suppliersand related systems (for the latter see also Meijs & Trienekens [7]). Bydoing this we take into account the technical (IT) perspective, the organi-sational (management) perspective, and the systems perspective (figure 3).

These three elements can be elaborated into several quality attributesthat are common among software quality practitioners:-Technical (software) quality: operations with the logistic informationsystem should hold correctness, reliability, maintainability, testability andintegrity;-Organisational quality refers to: functionality (completeness and consis-tency), useability (learnability), support to the organisation and manualprocedures. These criteria are related to TQM and JIT, section 3.2;



Organisational

quality procedures

Figure 4: quality model

-Quality of interfaces capturesthe criteria portability, reusabili-ty and interoperability. Thesecriteria are related to develop-ments to computer integratedmanufacturing, section 4.3.

Flexibility and integrationdemands to logistic informationsystems cover all three majorelements. Of major importanceis that organisational aspects, bymeans of total quality manage-ment in our example, becomeintegrated with the softwaresystem and with other adjacentsystems. Flexibility is especiallyto be found in the technical element (customer orders must be able to beworked out fast and adequatly) and in the organisational element (thehuman factor and the decision support models in the organisation are ofmajor importance for the logistic information system). Integration isespecially to be found in the organisational element, in the systems(interface) element: connections with other (inter)organisational or softwa-re systems, and in the software-technical element (integrity of data).

6 Conclusions and further research

In this study key characteristics of logistic information systems in chan-ging business environments were described. Analysing the changingbusiness environment of the food industry and major developments inproduction management concepts and IT opportunities, we conluded to achange in focus on quality characteristics of logistic information systems.

In the new generations of information systems the emphasis movesto the characteristics integration and flexibility. Quality of logistic infor-mation systems is not only related to technical quality aspects but stronglyrefers to organisational and (inter-)system quality aspects. This extensionin quality thinking explains flexibility and integration from an organisatio-nal integrating viewpoint.

However, important questions remain for further research. A naturalstep beyond quality models is the measuring and benchmarking of proces-ses (Meijs [8]); every quality model should have its metrics system. Alsofurther research has to be done to trade-offs between quality attributes inlogistic information systems. Introducing more flexibility in a logisticinformation system may well conflict with attributes like maintainability,functionality and useability. This should be well considered in developingand using logistic information systems. A third important research questi-



on would be the elaboration of the linkage between organisational quality,software quality and system quality.

References

1. Bemelmans, T.M.A. Management information systems and automati-on, Kluwer, den Haag, 1994, (in Dutch).

2. Bertrand, J.W.M., Wijngaard, J. & Wortmann, J.C. Production Con-trol, a Structural and Design Oriented Approach, Elsevier, Amster-dam, 1990.

3. Boehm, B.W., et al. Characteristics of software quality, TRW Seriesof Software Technology, Vol. 1, North Holland Publishing Company,New York, 1978.

4. Delen, G.P.AJ. & Rijsenbrij, D.B.B. Quality attributes of softwareprojects and information systems, Informatie, jrg. 32, nr. 1, Kluwer,Deventer, 1990, (in Dutch).

5. Eurostat. Industrial Yearbook 1993, Statistical Office of the EuropeanEconomic Community, Luxembourg, 1992.

6. Cavano, J.P. & McCall, J.A. A framework for the measurement ofsoftware quality, Proceddings of the Software Quality and AssuranceWorkshop, red. S. Jackson and J. Lockett, ACM, 1978.

7. Meijs, C. & Trienekens, J.H. Optimization of the value chain usingcomputer aided reference models, 3rd IFIP WG7.6 Working Confe-rence on Optimization-Based Computer-Aided Modelling and Design,Prague, The Czech Republic, May 24-26, 1994.

8. Meijs, C. & Dijks G. Information system architectures and bench-marks for local tourist offices, 2nd Int. conference on information andcommunication technologies, Springer Verlag, Vienna, 1995.

9. Moret Ernst & Young, management consultants. Logistic packagesfood, Utrecht, The Netherlands, 1993, (in Dutch).

10. Rijn, Th.M.J. van, Schyns, B.V.P., et al. MRP in Process; Theapplicability of MRP-II in the semi-process industry, van Gorcum,Assen The Netherlands, 1993.

11. Trienekens, J.H. & Trienekens, J.J.M. Information systems for pro-duction management in the food processing industry, Proceedings ofthe IFIP TC5/WG5.7 Fifth International Conference on Advances inProduction Management Systems- APMS '93, Eds LA. Pappas andI.P. Tatsiopoulos, Greece, Athens, 1993.

12. Trienekens, J.J.M., Time for better quality, improvement of informati-on systems, Thesis, Thesis Publishers, Amsterdam, The Netherlands,1994, (in Dutch).


management concepts. Section 4 - WIT Press€¦ · we refer a.o. to the models of Boehm [3] and Cavano & McCall [6]. For ... Quality management and lot traceability issues in food

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