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Sustainable Growth through Network Optimization
Team 9 Edward Addo-ChidieJonathan Westwood
Ratna Buelah KondraWilliam Ebow Hinson
GSCMI 2013 Case Competition 2
Problem
Optimization model
Q & A
EatonCorporation
Recommendations – Short term
Agenda (Ratna Buelah)
Recommendations – Long term
GSCMI 2013 Case Competition 3
Problems (Jonathan Westwood)
High premium shipping costs
GSCMI 2013 Case Competition 4
Problems (Jonathan Westwood)
Internal inefficiencies: high inventories
GSCMI 2013 Case Competition 5
Problems (Jonathan Westwood)
Frequent Stock outs at W87
GSCMI 2013 Case Competition 6
Optimization Model (William Hinson)
Shipping costs and capacity – Given
Assumption:Total orders in 2013 represent demandLTL shipping available & cost remains stable
GSCMI 2013 Case Competition 7
Recommendations (Edward Addo-Chidie)
Short term strategy Optimize factory shipments
DemandUnmet
Demand $1,680,8281,391,770 0 Shipping Cost475,319 0
1,217,881 0 16,251,567609,432 0 Total capacity
1,702,936 01,061,806 0 14,647,2231,194,800 0 Total demand1,319,869 01,707,960 0 90.1%485,295 0 Utilization661,880 0540,145 0630,455 0561,014 0505,666 0580,994 0
GSCMI 2013 Case Competition 8
Recommendations (Edward Addo-Chidie)
Weight delivered from each source
Fayetteville, 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
Capac 3,506,162 2,313,812 3,675,357 666,013 709,653 354,827 182,223 1,460,456 502,457 286,187 171,846 2,422,574
Excess 1,714,242 2,236,704 0 0 709,653 0 0 0 0 0 171,846 0
GSCMI 2013 Case Competition 9
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 10
Recommendations (Ratna Kondra)
Long term strategy Increase capacity at W87 by 200% in 2 years
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 0.4 0.5 0.6
Correlation with % Premium Shipping
GSCMI 2013 Case Competition 11
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 12
Q&A
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