Transcript Slide 1

Sustainable Growth through
Network Optimization
Team 9
Edward Addo-Chidie
Jonathan Westwood
Ratna Buelah Kondra
William Ebow Hinson
Agenda
(Ratna Buelah)
Problem
Optimization model
Eaton
Corporation
Recommendations – Short term
Recommendations – Long term
Q&A
GSCMI 2013 Case Competition
2
Problems
(Jonathan Westwood)
 High premium shipping costs
GSCMI 2013 Case Competition
3
Problems
(Jonathan Westwood)
 Internal inefficiencies: high inventories
GSCMI 2013 Case Competition
4
Problems
(Jonathan Westwood)
 Frequent Stock outs at W87
GSCMI 2013 Case Competition
5
Optimization Model
(William Hinson)
 Shipping costs and capacity – Given
 Assumption:
Total orders in 2013 represent demand
LTL shipping available & cost remains stable
GSCMI 2013 Case Competition
6
Recommendations
(Edward Addo-Chidie)
 Short term strategy
 Optimize factory shipments
Demand
1,391,770
475,319
1,217,881
609,432
1,702,936
1,061,806
1,194,800
1,319,869
1,707,960
485,295
661,880
540,145
630,455
561,014
505,666
580,994
Unmet
Demand
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
$1,680,828
Shipping Cost
16,251,567
Total capacity
14,647,223
Total demand
90.1%
Utilization
GSCMI 2013 Case Competition
7
Recommendations
(Edward Addo-Chidie)
Weight delivered from each source
Fayettevill
e, NC
Sumter,
SC
W34
W87
CDC
DBN
Arden, NC
Beaver,
PA
El Paso,
TX
Raleigh,
NC
NC
Others
ATL
0
0
1,391,770
0
0
0
0
0
0
0
0
0
Balt
0
0
0
0
0
0
0
0
0
0
0
475,319
Chi
0
0
366,857
0
0
0
0
851,024
0
0
0
0
Cle
0
0
0
0
0
0
0
609,432
0
0
0
0
Dal
1,130,040
0
218,069
0
0
354,827
0
0
0
0
0
0
Den
0
0
0
559,349
0
0
0
0
502,457
0
0
0
Hart
0
77,109
0
0
0
0
0
0
0
0
0
1,117,691
Hou
0
0
1,319,869
0
0
0
0
0
0
0
0
0
L.A.
0
0
0
1,707,960
0
0
0
0
0
0
0
0
NJ
0
0
0
0
0
0
0
0
0
0
0
485,295
Orl
661,880
0
0
0
0
0
0
0
0
0
0
0
Phx
0
0
0
540,145
0
0
0
0
0
0
0
0
Ral
0
0
0
0
0
0
0
0
0
286,187
0
344,268
StL
0
0
378,792
0
0
0
182,223
0
0
0
0
0
SF
0
0
0
505,666
0
0
0
0
0
0
0
0
Sea
0
0
0
580,994
0
0
0
0
0
0
0
0
666,013
709,653
354,827
182,223
1,460,456
502,457
286,187
171,846
2,422,574
0
709,653
0
0
0
0
0
171,846
0
Capac 3,506,162 2,313,812 3,675,357
Excess 1,714,242 2,236,704
0
GSCMI 2013 Case Competition
8
Recommendations
(Edward Addo-Chidie)
 Short term strategy
 Reduce or eliminate premium shipments
 Reduce or stop sourcing from Puerto Rico
- 97% of Puerto Rico shipments were ordered by
Dallas
- Dallas spent the most on premium shipping
($1.6 million)
GSCMI 2013 Case Competition
9
Recommendations
(Ratna Kondra)
 Long term strategy
 Increase capacity at W87 by 200% in 2 years
Correlation with % Premium Shipping
W87
Others
El Paso, TX
NC
Sumter, SC
Raleigh, NC
Beaver, PA
CDC & DBN
Fayetteville, NC
Arden, NC
Puerto Rico
W34
-0.3
-0.2
-0.1
0
0.1
0.2
0.3
GSCMI 2013 Case Competition
0.4
0.5
0.6
10
Recommendations
(Ratna Buelah)
Long term strategy
 Possibly add storage to CMSCs similar to DBN
in Dallas (more data is needed to evaluate this)
GSCMI 2013 Case Competition
11
Q&A
GSCMI 2013 Case Competition
12