Chemical Technology March 2015

Chemical Technology • March 2015

In every supply chain there are activities that must be initi-

ated in anticipation of future demand. The specific activities

vary with the business, but generally include finished goods

production, semi-finished goods production or rawmaterials

purchasing. To maximise performance, these activities must

be planned with the best available information. Improve-

ments in forecasting and demand planning can reduce the

need to carry excess safety stock or have spare capacity sit

idle. In a fully integrated supply chain, production opera-

tions should be closely linked with demand management,

so a company’s operational plan can adapt as quickly as

demand changes.

Generating an accurate demand forecast is a critical first

step in the S&OP process, as it is the demand signal that

Spreadsheets are widely recognised as inadequate for

managing complex supply chains. They are typically

customised to fit the constraints of each plant and are

prone to errors and labour-intensive data gathering.

The interactive Planning Board in Aspen Plant Scheduler

provides an easy way to visualise and make changes to the

schedule as well as view inventory levels for multiple products

simultaneously.

Scheduling Case Study – NOVA Chemicals

NOVA Chemicals, a plastics and chemicals producer with

manufacturing sites strategically located throughout Canada

and the United States, wanted to standardise their supply

chain operations – processes and underlying technology –

for their polyethylene business. Due to fragmented business

processes, lack of automation and scheduling models that

were customised for each plant site, NOVA Chemicals was

forced to manage their supply chain in a largely manual

fashion, making it difficult to react to any type of business

change. The company lacked the ability to evaluate the

impact or to determine the best course of action for events,

such as price changes, shutdowns, raw material constraints

or weather-related factors. Furthermore, the lack of uniformity

between models broke down synergies between groups and

made change management very difficult.

By committing to a new, standard set of business

processes for all parts of the polyethylene business, NOVA

was able to migrate to six standard aspenONE Supply

Chain Management applications with a single design

throughout. The new business processes and technology

were automated and integrated, enabling NOVA Chemicals

to react quickly to changing business conditions, reduce

overall IT ownership and model maintenance and improve

data sharing and collaboration to increase their scheduling

horizon by 100%.

“Due to forward visibility, the scheduling horizon doubled,

increasing from 90 days to 180 days. This gave the

schedulers better raw material visibility and a better product

wheel.”

Zoran Stojecevski, Systems Analyst and Developer, NOVA

Chemicals

S&OP Case Study – ¤15B specialty chemicals producer

in Europe

A €15 billion specialty chemicals producer based in Europe wanted to

ensure execution of reliable and cost efficient delivery of their products in

Central Europe. The company also needed to remove bottlenecks in the

production and distribution processes and to simultaneously optimise:

• Storage and transport capacities

• Logistics (mode of transportation, route, vehicle utilisation, etc.)

• Sourcing from shipping points

Additionally, the company needed to meet regulatory compliance

requirements to track CO

positions across ten European countries against

annual emissions limits.

This supply chain transformation was not an easy task considering the

complexity of their supply chain network, which includes more than 30 sites,

hundreds of resources, thousands of ship-to locations and a multitude of

raw material suppliers. The company did not have a global reporting system,

asset visibility or standard supply chain business processes across the

organisation. In fact, each country operated completely independent of one

another, tracking operations on desktop spreadsheets. To unify operations,

the company turned to Aspen Supply Chain Planner, a software application

that supports the S&OP process in the aspenONE Supply Chain Management

suite to achieve the following:

Optimise across 10 business units

Facilitate decision-making based on economics

Increase the transparency of their business processes

Perform both short-term (weekly/monthly) and strategic long-term (1-5

years) planning.

Through Aspen Supply Chain Planner, this specialty chemicals producer

easily determines alternative supply paths across the network and

dynamically selects optimal product source locations, based on physical

constraints and emissions limitations. By optimising their supply chain

to determine the lowest cost for each customer and by improving work

processes, data management and reporting visibility, this specialty chemicals

producer estimates that it will attain €20 million in annual benefits.

SUPPLY CHAIN

MANAGEMENT