A Scheduling and Kel 5-

Vol. 36, No. 1, January–February 2006, pp. 69–86 issn0092-2102 eissn1526-551X 06 3601 0069 inf orms ® doi 10.1287/inte.1050.0184 © 2006 INF ORMS A Scheduling and Capable-to-Promise Application for Swift & Company Ann Bixby, Brian Downs Aspen Technology, Inc., 2500 CityWest Boulevard, Suite 1500, Houston, Texas 77042 {[email protected], [email protected]} Mike Self Swift & Company, 1770 Promontory Circle, Greeley, Colorado 80634, [email protected] Swift & Company uses an integrated system of 45 linear-programming models based on three model formula- tions to dynamically schedule its beef-fabrication operations at five plants in real time as it receives orders. This scheduling application resulted in documented improvements in key metrics, such as order fulfillment, on-time delivery, and the percentage of a week’s scheduled production for which there are existing orders. The application enabled Swift & Company to execute its business strategy and obtain a 200 percent return on investment in its first year of production. Key words : industries: agriculture, food; programming: linear, applications. S wift & Company is a diversified protein-processing business based in Greeley, Colorado. A pri- va tely held company wi th pub lic ly tr aded debt , Swift & Company has three business segments: Swift Bee f, Swi ft Por k, and Swi ft Aust rali a. With annual sales of over $8 billion, beef and related products are by far the largest portion of Swift & Company’s business. Swift has slaughter and processing operations (the lat ter are also kno wn as fab ric ati on oper ations) at five plants located in Colorado, Texas, Nebraska , and Idaho. Three of the plants process fat cattle, animals up to two years old that have been fattened on feed lots for 90 to120 days before slaughter. Lean cattle are older animals, such as bulls or dairy cows, that are not fattened before slaughte r. Used primarily in com- merc ial food products , these animals are proce ssed at the remainin g two plants. Each plant has the capacity to process approximately 2,500 head of cattle per shift for a total of 18,000 to 25,000 per plant per week. This translates to over 6.0 billion pounds of beef delivered annually. Swift’s most important product line is boxed beef. Cattle buyers procure cattle on the open market based on projected demand by brand, grade, and weight. After slaughter, each head of cattle yields two sides of beef. After spending 80 hours in a chill room, each side is graded by the USDA for quality and yield. The fabrication process begins as workers divide each side into seven primal cuts: the chuck, the rib, the loins (short loin and sirloin), the round, the brisket, the plate or navel, and the flank (Figure 1). Then, they divide eac h pri mal int o sma lle r, subprimal piec es, pack them in plastic , vacuum-seale d packa ges, and box them for sale. Because beef products are highly perishable, and because of the economics of the beef business, once fabrication begins, workers must com- pletely process all seven primal cuts from each side during the same shift. The work is intense manual labor done by workers with little more than a meat hook and a sharp knife. It takes a great deal of skill to make the proper cuts while minimizing trim waste and maintaining the speed of the production line. For each primal, there are many possible production pathways, which together form a tree structure (Fi gur e 2). Types of cat tle are cla ssifi ed by qua lit y grade, yield grade, weight, and brand charact eristic s. USDA inspectors determine quality grade (for exam- ple, prime, choice, or select) and yield grade. They give higher quality grades to carcasses that show high levels of fat marbling based upon a cut made at the 13th rib. They base yield grades upon the thickness 69

A Scheduling and Kel 5-

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