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Supply Chain Network Redesign

Putten, F.M.J. van der (2017) Supply Chain Network Redesign.

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Abstract:This research provides a supply chain network redesign for an Engineer-to-order company. This project organization is global market leader in warehouse automation solutions. A first analysis shows that the current network struggles to meet on-time delivery of activities (group of orderlines), which violates responsiveness. We provide a network redesign to improve responsiveness by changing facility roles. With help of a literature study we provide a redesign with two networks and new facility roles: the project specific network focusing on responsiveness and the EOS network focusing on efficiency by aggregating item demand over all projects. This provides the opportunity to benefit of economies of scale. We show the impact is threefold: it enables clear strategic focus, it increases responsiveness and reduces costs. We construct a mathematical model to quantify these impacts. Numerical results show cost reductions of 4 million, taking into account inventory costs, savings in material cost and savings of orderline reduction. Responsiveness improves by orderline fill rate (from 57% to 78%) and activity fill rate (90% to 94%), but activity lead time does not improve. We recommend to start a pilot and provide an implementation roadmap. We also provide recommendations and suggestions for further research.
Item Type:Essay (Master)
Faculty:BMS: Behavioural, Management and Social Sciences
Subject:31 mathematics, 58 process technology, 85 business administration, organizational science
Programme:Industrial Engineering and Management MSc (60029)
Link to this item:http://purl.utwente.nl/essays/72272
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