Case Studies Operations Research Supply Chain Improvement

Project Objective

To analyze existing supply chain and identify focus areas for developing an agile and cost-effective supply chain and establish appropriate KPIs to ensure appropriate performance

Client
A subsidiary of the second largest Cement manufacturing company in the world.

Approach
The project was initiated with a survey of the demand variability and mapping the existing supply chain network structure into ScSimulator (DecisionCraft's proprietary solution). The inventory levels at different depots were mapped to the depot's demands highlighting the need for a thorough network and policy analysis using ScSimulator. ScSimulator allowed simulating hypothetical scenarios based on alternate network configurations and policies. Optimal network configurations and policies were estimated using ScSimulator.

 
Demand Variability Study
 
Create What-if scenarios and analyze
 Network Related Scenarios
  From where to source raw material and how to supply FG to One Stop Shops and retailers?
  Do they need distributors?
  What should be the size of a storage (Silo) at plant?
 Policy Related Scenarios
  How responsive is my supply chain to sudden spikes in customer demand?
  If I increase the service level from 95% to 99%, how much average inventory will increase and where?
Scenario Analysis for Supply Chain
 

Solution
A series of recommendations were made in terms of network configuration and supply chain policies that included back hauling and reducing the usage of costly spot charters for shipping raw materials.

Activities AS-IS
No. of Ports 3
No. of Warehouses 4
Types of Ships 4
No. of Material Flow Links/paths 9
Supply Chain Spread Diffused
Back Haul None
Ship contract Spot charter &
Time Charter
Activities AS-IS
No. of Ports 1
No. of Warehouses 2
Types of Ships 1
No. of Material Flow Links/paths 4
Supply Chain Spread Consolidated
Back Haul Yes
Ship contract Time Charter
Reengineered Supply Chain based on our Recommendations
 

Benefits
The savings for the client were estimated to be approx. USD 6.8 Million based on the new network configuration and policies.
 
 
Reengineer client's supply chain for agility
and cost-effectiveness
Subsidiary of one of the world's largest cement and aggregate supplier
Optimized network configuration resulting in savings of approx USD 6.8 Million
- Distribution Strategy
 
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