What if Santa’s workshop were run by computers?

Every year there are internet posts regarding the physics of delivering toys to a few hundred million children in one night. But I don’t recall seeing one on the logistical complexity of ordering, manufacturing, packaging, and preparing all those toys for shipment. Having worked in manufacturing companies for over twenty years, I have some idea of the difficulty involved.

Even using what appear to be the relatively conservative figures I have seen, of only 15% of the world’s population of children celebrating Christmas, and only allowing one toy per child, by my calcuations that still requires manufacturing over 1 million toys every day (not counting Christmas, which we assume is a day off for the elves). If they run 24/7 (either working in shifts, or else elves don’t need to sleep), that still means over forty thousand toys an hour, or about 700 every minute.

Now, those elves may be very good at making toys, and perhaps they can keep up that run rate all year long. But where do they store all those toys? How do they keep track of how many fire engines and dolls and skateboards and Lego sets they have made so far? How do they ensure a steady supply of plastic, paint, wheels, and – for today’s electronic toys – resistors, memory chips, LEDs, and so forth?

Manufacturing companies have been struggling with these issues for decades. Raw and finished goods inventories, once tracked on paper (one of my first jobs was in purchasing, where every part had a large index card, even though the actual purchase orders were entered in the computer), are now computerized. Keeping that computer inventory accurate is quite a challenge. But that’s nothing compared to the challenge of keeping track of what you need to order, when, and how much.

I was part of a team working on implementing an MRP II system (MRP was initially Material Requirements Planning, later broaded to Manufacturing Resources Planning) at that same company. I left when they were unable or unwilling to give me a twenty-five cent per hour raise (instead I got about half that, so I found a job where I was paid over a dollar more). When I chatted with my former co-workers the following year, I found out that they had implemented the MRP II system, and it had resulted in a quarter of a million dollars of electronics components taking up space in there storeroom.

Now, I doubt that the computer system itself was really at fault. Except in cases of hardware failure, computers simply follow the instructions they are given. The problem is that humans operating them think that the instructions they are giving the computer are the ones they think they are giving. Whether due to keying errors, misunderstanding of the logic of the program, or interactions between two different programs that mess up each other’s data, that is very often not the case.

MRP systems (or their successors with various alphabet-soup names) are so complex that they are very hard to implement properly. In a manual system, small mistakes usually have small consequences, because someone notices that there are too many widgets in stock and we don’t need a thousand more tomorrow, or that we’re behind on the schedule for an order for our biggest customer. But once people start depending on the computer, those things don’t get noticed as quickly, and the larger operations that can be (theoretically) managed by a computer means that small mistakes can quickly snowball into huge ones.

I thought of all this today because I got an emailed advertisement for training for an ERP package. (We don’t use this particular ERP package, but I got on their mailing list a few years ago and haven’t bothered to get off it.) The cartoon is rather cute, and is accessible online as well for customers who have trouble viewing it in their email. Frankly I think the picture would be a lot worse if Santa really did try to run his shop on an MRP package, unless he his elves are a lot better than most of us at implementing complex computer systems. But the cartoonist probably didn’t want to illustrate a worst-case scenario.

I suspect, though, that a faulty manufacturing planning/execution system was probably responsible for most of the oddities on the Island of Misfit Toys.

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