VIETNAM NATIONAL UNIVERSITY HO CHI MINH CITY HO CHI MINH CITY UNIVERSITY OF TECHNOLOGY -------------------- VO NGOC DUC SYSTEM INTEGRATION IN ORDER MANAGEMENT AT A GARMENT MANUFACTURING IN DONG NAI Major: Industrial Engineering Major code: 8520117 MASTER THESIS HO CHI MINH CITY, June 2024 THIS THESIS IS COMPLETED AT HO CHI MINH CITY UNIVERSITY OF TECHNOLOGY – VNU-HCM Supervisor: Assoc. Đỗ Ngọc Hiền Examiner 1: Dr. Lê Song Thanh Quỳnh Examiner 2: Dr. Nguyễn Văn Thành This master’s thesis is defended at HCM City University of Technology, VNU- HCM City, on June 8th, 2024 Master’s Thesis Committee: 1.
Nguyễn Đức Duy 3. Lê Song Thanh Quỳnh 4. Nguyễn Vạn Phúc Nguyên Approval of the Chair of the Master’s Thesis Committee and Dean of the Faculty of Mechanical Engineering after the thesis is corrected (if any). CHAIR OF THESIS COMMITTEE DEAN OF FACULTY OF MECHANICAL ENGINEERING i VIETNAM NATIONAL UNIVERSITY - HO CHI MINH CITY SOCIALIST REPUBLIC OF VIETNAM HO CHI MINH CITY UNIVERSITY OF TECHNOLOGY Independence – Freedom - Happiness THE TASK SHEET OF MASTER’S THESIS Full name: Võ Ngọc Đức ID: 2270250 Date of birth: 23/10/1993 Place of birth: Bình Định Major: Industrial Engineering Major ID: 8520177 I.
THESIS TITLE (In Vietnamese): TÍCH HỢP HỆ THỐNG TRONG QUẢN LÝ ĐƠN HÀNG TẠI MỘT DOANH NGHIỆP DỆT MAY Ở ĐỒNG NAI. THESIS TITLE (In English): SYSTEM INTEGRATION IN ORDER MANAGEMENT AT A GARMENT MANUFACTURING IN DONG NAI. TASKS AND CONTENTS: - Analyze and evaluate the order management process at the company to determine causes that create the low operation efficiency and waste in material consumption - Minimize material waste and increase operation efficiency by creating a new material management model and integration system approach with the support of ERP, WMS, Cutting system, and APS. - Evaluate the effectiveness of the model through practical implementation.
THESIS START DAY: 15/01/2024 V. THESIS COMPLETION DAY: 20/05/2024 VI. Ho Chi Minh City, June 8th, 2024 SUPERVISOR HEAD OF DEPARTMENT (Full name and signature) (Full name and signature) DEAN OF FACULTY OF MECHANICAL ENGINEERING (Full name and signature) ii ACKNOWLEDGMENTS The master's thesis writing process stands out as the pinnacle of one's academic journey. This thesis is pivotal in honing research skills and acquiring valuable knowledge for post-graduation endeavors.
First and foremost, I want to express my deep appreciation to the esteemed doctors and professors of the ISE Department. Their unwavering dedication to imparting essential knowledge throughout my academic tenure has shaped my educational journey. I am particularly grateful to Mr. Do Ngoc Hien for his steadfast guidance in nurturing scientific thought and methodology.
His valuable insights have facilitated the writing of this thesis and set a solid foundation for my academic and professional pursuits. Furthermore, I am deeply indebted to my family, friends, and the ISE community for their unconditional support and assistance throughout this academic journey. Their encouragement and help have been instrumental in navigating the challenges of both study and life. As we continue on our respective paths, I want to express my sincerest wishes for our continued success and fulfillment.
May prosperity and happiness always be our companions, and may we continue to grow and learn in our academic and professional endeavors. VÕ NGỌC ĐỨC iii ABSTRACT This research delves into material management issues using an integrated system approach. Materials management is one of the crucial functions in supply chain management, involving the whole process from the Development stage to the bulk production stage in garment manufacturing. The challenge for the organization is meeting the material requirements, such as price, availability, quality, and on-time delivery while having the lowest cost.
With a sound material management system, the company can reduce material lead time, lower material waste or dead stock, have a high inventory turnover rate, and lower material costs. Inappropriate working processes and lack of system approach are two main reasons for poor material management in most garment manufacturing. In this research, some material management systems have been mentioned, indicating the interactions between the various sub-systems in overall supply chain management. From that, an integrated system and material management process have been created and implemented with a case study in garment manufacturing to look after all these material management issues and minimize the material inventory cost.
Furthermore, this research also sets a general structure for the material management team and material pre-buy concept to mitigate the material left. Better operation efficiency and reduced material usage are the key outcomes of this research, and it will be discussed in the following section. Keywords: System Integration, ERP, WMS, APS, Material Management, Waterfall-Agile. iv TÓM TẮT LUẬN VĂN Nghiên cứu này đi sâu vào phân tích các vấn đề quản lý nguyên vật liệu thông qua việc áp dụng một hệ thống tích hợp.
Quản lý nguyên vật liệu là một trong những chức năng quan trọng trong quản lý chuỗi cung ứng, bao gồm toàn bộ quy trình từ giai đoạn Phát triển đến giai đoạn sản xuất hàng loạt trong ngành sản xuất may mặc. Thách thức của tổ chức là vừa đáp ứng các yêu cầu về giá cả, tính sẵn sàng, chất lượng, giao hàng đúng hẹn, và đồng thời đảm bảo chi phí tối ưu nhất. Với một hệ thống quản lý nguyên vật liệu hiệu quả, công ty có thể giảm thời gian giao hàng, giảm lãng phí nguyên vật liệu và hàng tồn kho, tăng tỷ lệ xoay vòng hàng tồn kho và giảm chi phí. Các quy trình làm việc không phù hợp và thiếu hệ thống là hai nguyên nhân chính dẫn đến quản lý nguyên vật liệu kém trong hầu hết các nhà máy may mặc.
Trong nghiên cứu này, tác giả đề cập đến một số hệ thống quản lý nguyên vật liệu, chỉ ra sự kết nối giữa các hệ thống con khác nhau trong quản lý chuỗi cung ứng tổng thể. Từ đó, một hệ thống tích hợp và quy trình quản lý nguyên vật liệu đã được tạo ra và triển khai với một nghiên cứu trong nhà máy sản xuất may mặc để giải quyết các vấn đề quản lý vật liệu và giảm thiểu chi phí tồn kho. Hơn nữa, nghiên cứu này cũng thiết lập một mô hình cho đội ngũ quản lý vật liệu tốt hơn, giảm thiểu nguyên vật liệu dư thừa. Tăng hiệu quả hoạt động và giảm chi phí nguyên vật liệu là mục tiêu chính của nghiên cứu này, và sẽ được thảo luận trong những phần tiếp theo.
Từ khóa: Hệ thống tích hợp, ERP, WMS, APS, Hệ thống cắt, Quản lý nguyên phụ liệu, Waterfall- Agile v THE COMMITMENT OF THE THESIS’S AUTHOR I, Võ Ngọc Đức, hereby declare that the work presented in this thesis is my original research. I affirm that all the sources and references used have been appropriately acknowledged and cited. I am committed to upholding the highest academic integrity and ethical standards throughout the research and writing process. This thesis has not been submitted previously, in whole or in part, to any other institution for a degree or any other qualification.
I take full responsibility for the content and conclusions presented in this thesis. VÕ NGỌC ĐỨC vi TABLE OF CONTENTS THE TASK SHEET OF MASTER’S THESIS. iv THE COMMITMENT OF THE THESIS’S AUTHOR. vi TABLE OF CONTENTS.
vii LIST OF TABLES. ix LIST OF FIGURES. x LIST OF ABBREVIATIONS. xi CHAPTER 1: INTRODUCTION.
Aim of the study. Object and range of study. Structure of the study. 4 CHAPTER 2: THEORY, LITERATURE REVIEW AND METHODOLOGY.
System development process. Garment production process. 11 CHAPTER 3: SYSTEM INTEGRATION IN ORDER MANAGEMENT. Object of study.
The Need Analysis. Material management performance. Standardize the material management structure and process. Standardize the process of cutting voucher release.
Pre-buy framework. Integrated system: ERP link to APS when creating washing samples. Integrated system: WMS link to ERP for inventory management. Result and Discussion.
56 viii LIST OF TABLES Table 3.1: List of opportunities to improve the operation processes .2: The comparison of two material structure team .3: Project timeline of Creating Washing samples during material purchasing .4: Project timeline of project link WMS to ERP .1: Research study plan .2: Task re-arrangement with the new structure of the material team. 52 ix LIST OF FIGURES Figure 1.1: Vietnam Export Turnover from 2017 to 2022 .2: Agile Development Methodology [20].3: Waterfall-Agile Methodology .1: Overall material supply chain from Spinning to finished goods Garment .2: Overall material management process .3: Process from Material purchasing to stock-out .4: Overall digital system used in the company [12] .5: WMS – Material import procedure .6: Cutting System Process with RFID .7: ERP structure & workflow .8: Fabric deadstock by season .9: The percentage of material on time .10: The number of cases inputting wrong data into ERP .11: The time to confirm LCO by season in average .12: Time to release cutting voucher for each PO by season in average .13: The overall connection of each sub-system .14: The changing the structure of the material team .15: New working process of the material team .16: The new process of cutting voucher releasing .17: The Framework of Material Pre-buy .18: The new & old processes from receiving orders to material purchasing .19: QFD of ERP with Project Creating washing sample .20: Flow thing model of ERP and APS about washing sample .21: Time to create the washing sample in ERP .22: QFD of Function Link ERP to WMS .23: Flow thing model of project link ERP to WMS .24: The results after implementing all those projects in this research .25: Cost & Benefit comparison .26: The integrated system for material management. 48 x LIST OF ABBREVIATIONS No. Abbreviations Description 1 CV Cutting Voucher 2 ERP Enterprise resource planning 3 WMS Warehouse management system 4 QFD Quality Function Deployment 5 LCO List of Customer orders 6 RFID Radio Frequency Identification 7 B2B Business-to-business 8 CRM Customer relationship management 9 SCM Supply chain management 10 PLM Product Lifecycle Management 11 SDLC Software development lifecycle 12 FOB Free On Board 13 BOM Bill of Material 14 QA Quality Assurance 15 MOQ Minimum order quantity 16 APS Advanced planning and scheduling system 17 PDM Product development management 18 ETA Estimated time of arrival 19 FW Fall-Winter season 20 SS Spring-Summer season 21 TPS Total Production System 22 CPI Cut panel inspection 23 PP Pre-Production 24 FGW Finished Good Warehouse 25 BU Business Unit 26 CRD Customer Request Date 27 PO Purchasing Order 28 SOP Standard operating procedures 29 MES Manufacturing execution system 30 AGV Automated guided vehicle 31 BPMN Business Process Model and Notation xi CHAPTER 1: INTRODUCTION.
Rationale According to the Ministry of Industry and Trade, Vietnam Institute of Strategy and Policy for Industry and Trade [3], Textiles and garments are one of the critical sectors of the Vietnamese economy, with more than 13,000 businesses and a workforce of over 2 million people. The following figure shows that just in the past six years, Vietnam's garment export turnover increased by 41.0 billion USD, ranking third in size after China and Bangladesh. After the Covid-19 pandemic, 2022 has been a transformed year with solid growth in most industries. In addition, the long-term trend of shifting orders from China to other countries with lower labor costs is still happening.
Vietnam is one of the best choices for foreign investors because of all its advantages. The increasing orders and fierce competition require garment manufacturing to have innovative competitive strategies to lead the market. Manufacturers are facing a shortage of lead time, low cost, and the best quality. Vietnam Export Turnover 50.0% 2017 2018 2019 2020 2021 2022 Vietnam Export turnover (Billion USD) % Difference compare with 2017 Figure 1.