Mobile Agent Based Supply Chain Management in Shipbuilding Industry

Mobile Agent Based Supply Chain Management in Shipbuilding Industry

Practical Design of Ships and Other Floating Structures You-Sheng Wu, Wei-ChengCui and Guo-Jun Zhou (Eds) 9 2001 Elsevier Science Ltd. All rights rese...

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Practical Design of Ships and Other Floating Structures You-Sheng Wu, Wei-ChengCui and Guo-Jun Zhou (Eds) 9 2001 Elsevier Science Ltd. All rights reserved

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MOBILE AGENT BASED SUPPLY CHAIN M A N A G E M E N T IN SHIPBUILDING INDUSTRY Jing-Yun Cheng, Bei Lu and Sheng-Kun Zhang School of Naval Architecture and Ocean Engineering Shanghai Jiao Tong University Shanghai, 200030, China

ABSTRACT Now China shipbuilding industry faces the following serious problems: low productivity and long construction period. In order to cope with it, a mobile agent based supply chain management solution is provided. Firstly, summarizes the related research of supply chain management and intelligent agent and their application in shipbuilding industry. Secondly, a general commerce model which was developed by HAAS School of Business is used to design a shipbuilding supply chain management. Then implements a prototype which is based on IBM A g l e t - a mobile Java agent development kit. The paper ends with some conclusions and suggestion for future research.

KEYWORDS Shipbuilding, Supply Chain Management, Mobile Agent

1 INTRODUCTION Shipbuilding is a typical make-to-order manufacturing, which is very complex and complicate. In order to survive in the competitive global shipbuilding market, each shipyard tries its best to take measure to decrease the cost, enhance the quality and etc. For shipyard in China, the difficulties confronted with are more serious. For example, in 1980s, the cost per tonnage is about 30 percent to 40 percent lower than shipyard in Japan. But since 1992, with the increasing of the cost of material, marine equipment and work force, then the shipbuilding cost has been increasing with 16.9 percent per year. Moreover, in other aspects such as quality, just in time delivery and level of management & technology, Chinese shipyard lags Japan, Korea, and European shipyards. How can we cope with these challenges? In current global agile competition environment, only the enterprise who can put a stress not only on high quality, productivity, and reduced cost, but also on the ability to react quickly and effectively to changes in markets. During the implementation of agile manufacturing, supply chain management (SCM) has been utilized widely, which can reduce the cost, improve the productivity and efficiency of management, and shorten the period of product's R&D. In the commercial shipbuilding, according to statistics and ERIM research tSl, the cost of material and

374 equipment is about 50 percent of a delivered commercial ship, the percentage will be 75 higher in the passenger liner. So decrease the purchasing cost, simplify the procedure, and implement just in time purchasing is the critical factor to the enterprise. In shipbuilding industry, more and more shipyards begin to realize the importance of supply chain management. Japan, Korea and USA have initiated the related research on SCM and its implementation. In this paper, 4 parts are divided. Section 2 of this article reviews the research on supply chain management and intelligent agent. Section 3 analyzes the business process model in shipbuilding SCM and designs the agent based supply chain. Section 4 brief describes the implementation of the prototype of a shipbuilding supply chain management system which based on mobile agent technology - IBM Aglet, the prototype mainly focuses on the purchasing of the material and marine equipment in the global market. Finally, the conclusion and future research is provided in section 5.

2 RELATED RESEARCH Supply chain management began in 1980s. Supply chain management focuses on systems and processes to support the flow of information within and between organizations which occurs in the context of procurement, manufacturing, sales, distributions of goods, information and services 1,0j. The dynamic, unpredictable business environment of today further demands considerable process flexibility along the supply chain as a firm's set of commercial suppliers, customers, trading partners and even strategic allies - together defining its supply chain topology - may now shift both abruptly and frequently. In SCM, traditional EDI lacks the flexibility and efficiency required for the state of art electronic business. Even such web based e-commerce applications do not satisfy these joint requirements for process integration and flexibility, as most of web based supply chain technologies fail to closely integrate buyer and seller processes, they are developed predominately for either the buyer or seller, but not both t,l Fortunately, recent emerging technology - Intelligent Agent provides the potential and capability for buyer-seller integration and flexibility in SCM E''I. There are many definition of intelligent agent, but at here, agent is defined as a component of software and/or hardware which is capable of acting exactingly in order to accomplish tasks on behalf of its user. It has the following attributes I''l 9 Autonomous 9 Social function 9 Reactive 9 Proactive 9 Mobile Fox t6j firstly use cooperative agent network to represent the supply chain, in which each agent represent one or multi function of supply chain, and coordinate with other agents to reach the optimal status. Swaminathan r''l use a multi agent framework to model the supply chain, in which exist two categories of element: structural elements and control elements. Structural elements including production elements (retailers, distribution centers, plants, suppliers) and transportation elements are modeled as agents. Control elements (inventory, demand, supply, flow and information controls) are used to help in coordinating flow of products in an efficient manner with the use of messages. Brugali TM use the mobile java agent in supply chain management, which facilitate the enterprise response to the market's change, and optimize the whole supply chain. P.Dasgupta tgl use Java mobile agent technology to build a networked electronic trading system. T.Weitzel c'21 provide an XML based B2B communication architecture that provide the solution to expensive and inflexible EDI connections. There are many complex processes in shipbuilding industry, now more and more focus is put on SCM. Korea shipyard has initiated a project of electronic supply purchasing system. In USA, the

375 Shipbuilding Partners and Suppliers (SPARS) Consortium is established to deploy shipbuilding Supply Chain Virtual Enterprise which will integrate the shipbuilding supply chain composed of customers, partners, subcontractors, and suppliers. J.K.Lee t161used intelligent agent in the scheduling system for shipbuilding In general, SCM in shipbuilding lags other industries, and has the following attributes TM. 9 SCM in shipbuilding is hampered by a lack of consensus on the structure, function and dynamics of the integration of ship production and SCM. 9 Shipbuilding lags in the use of electronic commerce technologies. 9 Inaccurate production schedules affect many aspects of supply chain management, including increased supplier costs, problems with timeliness and completeness of vendor-furnished information, and diminished trust between the yard and its suppliers. 9 Although people begin to implement SCM in shipbuilding industry, but not all shipyards realized its importance. Especially in China, no much focus even in the mind of manager of shipyard, the relation between shipyards and their suppliers is more adversarial than necessary, not win-win.

3 MODELING THE AGENT BASED SUPPLY CHAIN MANAGEMENT Since SCM involves a set of activities in and between enterprises. It is necessary and convenient to analyze the process of SCM via a commerce model. This Commerce Model was originally developed for one of the prototypical courses on electronic commerce at the Haas School of Business and pertains to commerce in general I141. See the figure 1, it consists of buyer, intermediary, seller, and a series of activities and interactions. The diagram depicts the process flow (from left to right) associated with a commercial relationship or transaction, a transaction or relationship can be seen to progress through each step along the process flow depicted in the model. Clearly these steps represent commerce at a very high level B1 Buyer

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Figure l" General Commerce Model From the buyer's perspective, the process begins with the identification of some need and proceeds through sourcing and purchasing to the use, maintenance and ultimate disposal of whatever product, service or information is purchased. The seller's process begins with some arrangement to provide a product, service or information (e.g., research and development, service process design, information acquisition, etc.) and proceeds through marketing and sales to customer support. The arrows connecting these high-level process steps are used to represent key items of exchange between buyer and seller, items which constitute the commercial activity proper. For example, information is exchanged at several points along the process flow, as are money and goods (or services, information, etc.) and even "influence," as delineated at the negotiation stage. In the actual activity, each the higher activity can be divided into sub-activity. For example, the fulfilling order can be divided into the receiving order, notifying the shipping and logistics schedule and so on. Moreover, many activities can

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be inserted into the buyer and seller, such as factory, warehouse, vendor, and financial department. Through the above two methods, the user can design any complicated SCM according to their need. In the shipbuilding enterprise, the effective method in SCM is to purchase the steel, paint, marine apparatus and other materials according to the production schedule in the global market, and then reach the goal of purchasing under request, zero inventory and speeding the production. Based on HASS commerce model, we design an agent based SCM in shipyard. (See the Figure 2) The whole supply chain consists of user, an intermediary supply department and seller. The user represents different department in shipyard, such as design, engineering analysis, manufacturing, finance and other departments. The supply section represents various users, purchases on behalf on various needs. The seller is the suppler who can provide shipyard with the need product. They locate in worldwide. The whole enterprise activity consists of two flow, purchasing and fulfillment. As shown in Figure 2, the commerce model is expanded to meet our need. For example, B1, B2 is divided into a series of activities, exchanges among the use, supply and seller. Such as market survey, complete PR form, research resource. Among, exchange internal to the organization is represented with X2', X5'. At the same time, the buying activity is divided and extended to the following activities (analyze the price, select resource, sign the order and receive product and make payment)

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Figure 2: Enterprise Supply Chain Process

4 PROTOTYPE

Mobile Java agent -IBM Aglet is selected in our prototype of SCM, since the suppliers in shipbuilding SCM are located worldwide, and in current network band, the mobile agent can keep the data integration and security, combined with other characteristics, it can meet the need of agility of enterprise t2'81.Moreover, IBM Aglet is flee to use according the license.

377 Aglets are Java objects that can move from one host on the network to another. That is, an aglet that executes on one host can suddenly halt execution, dispatch to a remote host, and start executing again. When the aglet moves, it takes along its program code as well as the states of all the objects it is carrying. A built-in security mechanism makes it safe to host untrusted aglets. The details of IBM Aglet please refer to its ASDK t121 In the implementation of supply chain, we simplified the purchasing process into 8 activities: 9 Fill the buying request 9 Verify the form 9 Research resource 9 Issue the RFQ 9 Prepare the quotes 9 Analysis the quotes 9 Issue the order 9 Use product The fulfillment process can be simplified into 5 activities: 9 Prepare quotes 9 Arrange production 9 Fulfill order 9 Send invoice 9 Customer support The above activities include the major processes in the supply chain. As figure 3 show, the whole system consists of 3 parts, use, the buyer's subsystem and supplier's subsystem. This sub system can be exchanged. During the buying, customer can fill the order according the requirement of production planning and scheduling, send it to the intermediary- the buyer department of shipyard, then verify and integrated the requirement of different section, and form the buying list. This list is written with XML, which include: 9 the price of product 9 the highest available price 9 the amount of product 9 delivery time 9 the URL for supplier 9 the ID of supplier 9 the ID of product for supplier The buyer's subsystem consists of stationary agent, mobile agent, the potential supplier information and temporal log for recording transaction. The potential supplier information is acquired through research resource, market analysis, also it can add the new supplier to the information of supplier. The database of temporal transaction save the price and temporal transaction log when the mobile agent move, it's used for the final analysis. The seller subsystem consists of the stationary agent of supplier, the database of current supplier inventory, and interface of database and transaction log. The stationary agent is responsible for the transaction with buyer mobile agent, accept its price, and retrieve its inventory and its production plan to decide whether sign this transaction. In the actual running, when supply department of shipyard verify the form, the buyer stationary agent firstly create a mobile agent, pass the mobile agent with the information from the list and supplier information. Mobile agent then visits every supplier according to the supplier information, the quantity of product and standard. During the negotiation, the standard of purchasing can be one of the following according to the different need, such as price, delivery time, or the combination of them. When the buyer's mobile agent arrives at the supplier, it has an interaction with seller agent. So seller agent can

378 retrieve to decide whether the price meet the need, then reaches the temporal transaction, and the buyer builds the new proxy agent and returns the information to the buyer stationary agent, then visits the next supplier to go the same procedure. When the agent finished the prescribed itinerary. The buyer's agent select the optimal choice, sign the contract, for that is not optimal price supplier, cancel the proxy agent and temporal transaction, and pay the corresponded penalty money. Through this agent, the supply department can execute the purchasing based on their production scheduling. (The detailed implementations please see cl51)

Figure3: The Architecture of Mobile Based SCM

5 CONCLUSION The paper researches the agent based supply chain management in shipbuilding industry, a general commerce model is used to model and design the supply chain management, and implement a prototype of SCM. From the above, mobile agent based supply chain can reduce the cost, inventory, shorten the production period, and finally reach the agile manufacturing. From our implementation, the

379 result is encouraging, especially suitable for the global purchasing. But this system is quite simple, and currently the supply chain is mainly on purchasing, so the future research is mainly on the following, 1) In the shipbuilding SCM, quantitative and correct production plan and its executing is an important factor, so integration of supply chain management and production plan system is the next major research. 2) The dynamic attributes of supply chain management, such as later delivery, the quality of product will have a great impact on the whole SCM. So it's necessary to implement research on simulation of its dynamic attributes.

Acknowledgments The author would like to thank Professor Mark.E.Nissen (Naval Postgraduate School, USA) for his suggestive discussion and kind assistance in the research.

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