Supply Chain Rationalization and Optimization

As many authors have pointed out, more and more today, raw materials and finished goods supply chains stretch around the world and require considerable managerial effort to develop and manage on a day to day basis. Currently, we have had the opportunity to model worldwide supply chain movements for firms such as Emerson, Federal Mogul, Sigma Aldrich, and Israeli Chemical Limited (ICL). From these modeling efforts and studies a great deal was learned regarding the need for engineering like precision in data input, analyses, and interpretation. It is this writer's belief that logistics and supply chain managers of the future will bring such strategic modeling into daily operational and even tactical use as they source and distribute on a global scale. This presentation will detail some of these observations of modeling large supply chains, the difficulties incurred in collecting and cleaning shipment data, and the time required to test and verify the accuracy of data for model generation. In addition, the presentation will demonstrate the types of strategic, operational, and tactical decisions such modeling can assist in making. Finally, the presentation will conclude with some general recommendations as to what industry and academia should be doing to create personnel capable of developing and running these models - taking them from occasional strategic decision making exercises to more of the operational context we see them in the future.