Improvement of the 11th Warehouse in ISDEMIR

System Explanation

Flow chart of ISDEMIR

ISDEMIR is an integrated steel plant that can produce both flat and long products. Billet and wire rod are long products. Billets are produced by the way of melting steel and flowing it quickly into a specially prepared mold in a continuous stream. At that process, liquid steel is obtained from basic oxygen furnaces. On cooling, steel retains the shape of the mold. Billet is a semi-finished product that is used in manufacturing of wire rod, reinforcing steel bar, steel profiles and seamless pipe. On the other hand, wire rod is used for manufacturing commercial products such as mesh, wire and nail.

Slab and hot rolled coil are flat products of ISDEMIR. The manufacturing process of slab is similar with billet. Liquid steel is flowed into molds and then cooling process is applied. It is also semi-finished good that is used in order to produce hot rolled coil and hot rolled plate.

ISDEMIR can respond demands of the market by its manufacturing system that can be easily changed to suit new conditions and situations. Thus, because of suitable capacity levels and the demands of market, pig iron and deformed reinforcing steel bars are included in the product mixture of ISDEMIR. Moreover, some by-products are produced through process of steel production. Granulated BF slag, coke, crude benzene, ammonium sulphate and coal tar are some of these by-products.

Transfer chart

At the end of production process, finished products are transferred to warehouses. There are several warehouses inside the ISDEMIR campus and transfer is done by wagons from production area to warehouses. When wagons achieve warehouses, they are located onto unloading stations of warehouse and finished products are unloaded by help of winches. Each warehouse has more than one winch that were fixed to buildings.

Because of high demands, ISDEMIR also supplies finished products from surrounding small rolling plants; for instance Yazicilar and Ekinciler. Collected products from the suppliers are transferred to ISDEMIR’s warehouses by trucks and unloaded in the unloading stations by help of winches.

Similar to incoming products, outgoing products has two alternatives. They are transferred via truck, if they are sent to their destination with highway; or they are transferred by wagons to ISDEMIR Seaport, if they are sent to their destinations with seaway.

Managerial side of ISDEMIR has three-step hierarchical structure. At the top, there is Board of Directors. General Manager comes after Board of Directors. At the bottom, manager of subunits are placed. System Development Unit is one of these subunits. Nine industrial engineers work in that unit. Each project session, they form groups of three and undertake one project of the unit to solve as a team. They solve work force requirements problems, machine abilities and tooling problems, warehouse improvement problems, energy requirements problems, logistic problems, facility design problems inside the factory. Each group is responsible to unit manager. Moreover, this is the unit where I have performed my summer training.

Problem Definitions and Analysis

In the 11th warehouse, billets, wire rods, slabs and deformed reinforcing steel bars are stored. However, finished products are unloaded to the warehouse field randomly. In other words, there is not a floor plan which demonstrates assignment of spaces for storage of different products. When the problem is analyzed, it is observed that the old layout ignores locations of unloading and loading stations. Thus, accumulation happens around stations where other parts of the warehouse are empty. Moreover, the layout decision affects utilization of winches.

In that warehouse, deformed reinforcing steel bars are loaded and unloaded to the trucks by the help of manual winches. Each deformed reinforcing steel bar bunch has a weight of 2 tons. There are two manual winches for loading and unloading, and each has a carrying capacity of 10 tons. In order to perform loading or unloading operation, four operators are required to each winch. One is winch operator, and other three operators put on or off the winch’s hook to deformed reinforcing steel bar bunch. This causes waste of both time and workforce. However, there is a magnet winch in the warehouse. The capacity of this magnet winch is 20 tons and it can be operate by the help of only two operators. On the other hand, it waits in an idle position.

Analysis result of this problem shows that the magnet surface area of the magnet winch is not appropriate to carry more than 3 bunches at one carrying cycle. This means, with magnet winch one can carry at most 6 tons where 10 tons can be carried with manual winch. Moreover, time study is performed in order to compare carriage cycle times between two winches. At that time, we were faced with another problem. Magnets of the winch are connected to main part with metal chains. This causes oscillation and carrying a bunch becomes more difficult for the winch operator. The result of the time study for manual system is five minutes per cycle, on the other hand, for the magnet winch it varies between four and eight minutes per cycle. In conclusion, lack of modernization causes decrease in capacity of magnet winch.

Moreover, transportation of billets, wire rods, slabs and deformed reinforcing steel bars to the ISDEMIR Seaport is done by wagons. Wagons are loaded by the help of one winch and train can move only if all the wagons are loaded. Each train has six wagons. However, reports demonstrate that they can not carry required amount of product to ISDEMIR Seaport in a required time.

Solutions and Evaluations

Floor plan problem inside warehouse problem was solved by creation of a new plan. Firstly, demands of each product were calculated and field of the warehouse divided into small areas to assign products proportionally with their demands. Each section was drawn with lines and signboards were used to clarify the section limits. The unloading policy was declared to workers. According to this policy, it is clear that how products may arrive the unloading area, who is responsible from the unloading process, and then how products placed onto the storage area.

In the literature, similar problem was solved with another method. In their articles “Warehouse Layout Design: Minimizing Travel Time with a Genetic and Simulative Approach - Methodology and Case Study” , Queirolo et al. (2002) performed another method. They set an optimization model that is NP-Hard. This model assigns storage area to the different kind of items. Moreover, a deterministic simulation model is used to support results.

New winch

Secondly, for the waste of time and workforce problem by winches were tried to be solved inside the 11th warehouse. At the beginning of the solution process, changing the setup of the existing magnet winch was considered in order to remove oscillation problem. The solution says that magnets of the winch are placed inside the main board of the winch. However, this solution is not optimal because the surface areas of the magnets are not changed according to the first situation thus, its capacity remains the same. Secondly, integration of a new winch to the system was considered. An idle winch from the 13th warehouse was transferred to 11th warehouse. In order to support the solution, cost analysis was performed. The existing manual system was compared with considered system. As a result, modernization of the system gives us more beneficial results.

Solution of the model

In their article, Burt and Cacetta (2000) discuss alternative models for selection of material handling equipment. Their main objective is creating best model which minimizes overall cost of material handling. They also consider life time of equipment which is a random variable and which makes their model stochastic. However, in the final part of their article, they offer complex linear model to solve such problems.

For the last problem, a mathematical model was set to find what the optimal number of wagons for train is. However, we cannot find the optimal solution. Thus, we focused on number of winches for loading wagons. As required, we achieved the optimal solution. After that, we created simulation model of the system and assigned random loading times in order to gain more realistic solution. Moreover, some values were changed and problem was simulated again and again in order to measure the flexibility and sensitivity of the system.

Simulation model

Working as a Member of a Team

We were group of four and my supervisor was Burcu Karapinar. All team members are industrial engineers and they all work in the System Development Unit. However, other two engineers also worked for another project and I worked together only with Mrs. Karapinar. In the group, we worked collectively and we did not specify the tasks we have carried out. We visited the warehouse together, asked our questions to the workers, and did time studies together. Models and alternative solutions were also the result of the collective studies, experiments and discussions.


During my summer training, I tried to perform my best as a member of an engineer group. My education about industrial engineering at Bilkent University helped me a lot. I solved problems with analytical, practical and technical thinking. Furthermore, my supervisor assisted me a lot. We solved three main problems that were floor planning, modernization and logistic problems. As a result, we collectively improved the system.