A new logistics system is being designed to transport one product from a factory to a terminal by rail. A simulation study is needed to estimate the following:

1. The rail fleet size.
2. The size of the rail yard at the factory.
3. The size of the rail yard at the terminal.
4. The size of the inventory needed at the terminal.

Customer demand is satisfied each day from the terminal. Demand is normally distributed with a mean of 1000 units and a standard deviation of 200 units. Production at the factory is sufficient to meet demand on a daily basis. Policy is to ship an average of 1000 units each day from the factory to the terminal. Each rail car holds 150 units. Partial rail car loads are not shipped but included with the demand for the the next day.

The customer service level provided at the terminal should be at least 99%. The time period of interest is one year

Transportation time from the factory to the terminal is triangularly distributed with a minimum of 3 days, a mode of 7 days, and a maximum of 14 days. At the terminal, a car must wait for a single unload point to unload. Unloading takes one hour. Upon return to the plant, a rail car is inspected. Inspections take 2 hours. Maintence is required for 3% of returning cars. Maintenance requires 4 days.

Embellishment: All cars leaving the factory in a day join a single train leaving at 4:00 A.M. the next morning and have the same transportation time to the terminal. A single train containing all empty cars leaves the terminal at 4:00 A.M. each morning.

Case Study Issues.

1. What initial conditions concerning the arrival of trains to the terminal should be used?
2. What target inventory level should be used?
3. How is the policy to ship 1000 units each day from the factory implemented if rail cars hold 150 units?
4. Embellishment: How is the requirement that all rail cars leaving the factory or terminal join a single train with a single transporation time to the other site modeled?
5. How is the unloading constraint for rail cars modeled?
6. In what order should the system parameters listed above be determined by the simulation experiments?
7. What is the primary performance measure for the simulation experiments?
8. How will verification and validation evidence be obtained?
9. How is the size of a rail yard modeled?
10. How is the size of the rail fleet modeled?
11. Computed the expected fleet size and use the result in providing validation evidence.
12. Define the processes that comprise the model.