TOCICO

The presentation objective is to share insights about managing stocks (make-to-availability) in V-plants in which there is no control over the outputs (low-yield production environments). The presentation includes: identifying an environment that falls under this scenario; a case study of an environment with multiple quality levels; and a generalization to other environments that can use the same mechanism. Attendee benefits include: Learning how to model a typical V-plant environment in the supply chain; understanding how to choose the best modeling for an environment taking into account various considerations; and learning how to deal with high scrap rates in the process. In V-plants, very few raw materials are processed into multiple finished goods. These finished goods are sometimes the result of different processes; different quantities used or sometimes even the result of some uncontrolled variable. In these cases, we’re getting an unpredictable number of different end items. Sometimes we have enough statistics to know how many of these items will turn up as one of the end products. The case study details an environment in which we receive 4 different qualities of an item. All the qualities can be sold, as different customers need different qualities. The challenge lies in how to model the environment in order to receive the best availability coupled with the lowest inventories.