Background and Objectives

1. Background:

Our company, ABC Pte Ltd uses petroleum as one of the raw material for our finished products. It is crucial to ensure that we constantly have sufficient amount of petroleum to avoid any potential loss of sales due to shortage. 

There are 8 numbers of tanks which stock petroleum for sale to end-users. These tanks are each measured at 5m in diameter and 8m in height. It is important to ensure that inventory level is maintained at least at 75% of the total capacity. That is, 2 or less number of tanks could be empty at any one time. In order to make sure that our supplies are able to meet the high demands of the end-users at all times, it is our responsibility to work closely with our vendors such that replenishment of petroleum to our empty tanks is promptly taken place.

Inventory checks are done periodically using a conventional method of manual measurement. This involves dipping a gauge into the petroleum tank to estimate the current level of petroleum available in the tank. The measurement data, trends of usage and replenishment with the end-users and vendors respectively are all recorded manually for each tank. These trend records are reported to the Direct of Operations on a monthly basis. This monitoring and reporting method is very labor intensive and manual which lowers the productivity of the staff. There is also the constant issue of measurement inaccuracy.

2. Objectives:

To replace manual measuring of Petroleum in tanks with automated petroleum replenishment system by 15 Dec 2011

Specific

*        To automate the current measuring method of petroleum by installing software operated measuring instrument which will send alert signal to the system once reach the point of replenishment.

*        To automate the PO issuing process to Vendors. PO will be issue by the system and send to designated vendors  when it  received signal from the measuring instrument

Measurable

*        Improvement in accuracy

*        Reduce service technicians

*        No more stock out

Achievable

*        Through suitable and compatible level measuring instrument and software.

Relevant

*        To improve overall efficiency of the work process

*        To improve measurement accuracy

Timely

*        Automated Replenishment System must be ready in one year by 15 Dec 2011