Simulation Of The Manufacturing E-Procurement Process

Procurement is migrating from paper-based to electronic -based processes, thus the term e-procurement. Eprocurement can shortened the time between receipt and fulfillment of orders, thus reducing inventory and improve company cash flow. Successful e-procurement process design and improvement efforts require the understanding of the behaviour of work flowing through the system. Changes at one station can effect the performance at other station in the system. Correct decision on any changes can maximize the throughput and minimize the flow time. This paper discusses a study on how simulation was used in modeling and simulating the internal eprocurement process of a multinational company in Penang, Malaysia. The study analysed the performance of the company internal e-procurement process and proposed some area of improvement within the e-procurement process. Statistical analysis method was used to measure the input and output of the model. The model is built using Arena, a package for discrete event simulation. Results obtained were reliable and credible compared to real time data. Recommendations were presented for the improvement of the company internal e-procurement process.