Increasing the reliability of production schedules in a pharmaceutical packaging department

This paper studies quantitative methods for evaluating the potential benefits of introducing new advanced tracking technologies in the pharmaceutical industry with special reference to radio frequency identification (RFID). RFID technology is an effective way for increasing the quality of the data that are used to generate production schedules, but there is a lack of scientific research to quantify the return on investment that can be achieved in practice. In this work, we distinguish two major sources of data unreliability: one is the inherent stochasticity of operations, which cannot be reduced by RFID, and the other one is the data estimation error, which can be significantly reduced by RFID. We focus on the marginal contribution of the latter quantity to the productivity of the packaging department of a pharmaceutical plant, propose a systematic method for assessing this impact and discuss its implementation in a practical test case. Our results confirm that advanced tracking technologies in combination with effective scheduling procedures show a significant potential for improving productivity. Extensions to other production environments and their issues associated with scheduling problems are also discussed.