A breakthrough in optimization
Downstream Network Optimization
For a heavyweight industrial player like Tata Steel in Ijmuiden, maintaining an efficient and robust sea network is not just a logistical necessity but a strategic imperative. The seamless flow of both outbound and inbound shipments is critical for the uninterrupted supply chain of raw materials and the timely delivery of finished products. In this dynamic global landscape, the ability to model and anticipate various scenarios is paramount for proactively addressing challenges on the horizon.
Tata Steel’s operations in Ijmuiden, situated by the sea, necessitate a well-orchestrated outbound sea network for exporting finished steel products and an efficient inbound sea network for the importation of crucial raw materials. The capability to model different scenarios becomes a powerful tool for the company, enabling them to prepare for a spectrum of challenges, including fluctuations in demand, geopolitical shifts, and disruptions in the shipping industry.
A stepwise approach Systematically seeking savings in the capital-intensive market
This project primarily focused on optimizing the distribution, particularly the outbound transport, from production sites in England and mainland Europe to four distribution regions (Germany, North America, Spain, Portugal, and Italy). Working alongside the Tata Steel team, we modeled this complex network, evaluating specific cases and solutions. The project aimed to develop a standardized approach and optimization method that Tata Steel could use for similar challenges.
The emphasis in this project was on choosing between different transport modalities, including associated capacities and rates. The developed methodology is capable of addressing questions about outbound transport at both strategic and tactical levels. With a sophisticated model encompassing a range of options (barge, train, truck, etc.), varying levels of detail, and the inclusion of actual transport contracts, this project represents an advanced solution.
By leveraging these advanced modeling techniques, Tata Steel can assess the impact of potential disruptions, optimize shipping routes, and enhance overall resilience. This foresight not only ensures the reliability of the sea network but also positions the company to navigate the complex interplay of global factors affecting the steel industry. In essence, the efficiency of Tata Steel’s outbound and inbound network, coupled with scenario modeling capabilities, becomes a linchpin for sustaining operational excellence.
In this project we used a set of supply chain network models to simulate the different scenario’s and simulate the performance and lead-times: Simulation module of our Spanning Tree platform, Multi-echelon inventory optimization and costs database.