Optimizing supply chain is the most successful key for manufacturing systems to be competitive. Supply chain (SC) has gotten intensive research works at all levels: strategic, tactical, and operational levels. These levels, in some researches, have integrated with each other or integrated with other planning issues such as inventory. Optimizing inventory location and level of safety stock at all supply chain partners is essential in high competitive markets to manage uncertain demand and service level. Many works have been developed to optimize the location of safety stock along supply chain, which is important for fast response to fluctuation in demand. However, most of these studies focus on the design stage of a supply chain. Because demand at different horizon times may vary according to different reasons such as the entry of different competitors on market or seasonal demand, safety stock should be optimized accordingly. At the planning (tactical) level, safety stock can be controlled according to each planning horizon to satisfy customer demand at lower cost instead of being fixed by a decision taken at the strategic level. On the other hand, most studies that consider safety stock optimization are tied to a specific system structure such as serial, assembly, or distribution structure. This research focuses on formulating two different models. First, a multi- echelon safety stock optimization (MESSO) model for general supply chain topology is formulated. Then, it is converted into a robust form (RMESSO) which considers all possible fluctuation in demand and gives a solution that is valid under any circumstances. Second, the safety stock optimization model is integrated with tactical supply chain planning (SCP) for manufacturing systems. The integrated model is a multi-objective mixed integer non-linear programming (MINLP) model. This model aims to minimize the total cost and total time. A case study for each model is provided and the numerical results are analyzed.

Optimizing supply chain is the most successful key for manufacturing systems to be competitive. Supply chain (SC) has gotten intensive research works at all levels: strategic, tactical, and operational levels. These levels, in some researches, have integrated with each other or integrated with other planning issues such as inventory. Optimizing inventory location and level of safety stock at all supply chain partners is essential in high competitive markets to manage uncertain demand and service level. Many works have been developed to optimize the location of safety stock along supply chain, which is important for fast response to fluctuation in demand. However, most of these studies focus on the design stage of a supply chain. Because demand at different horizon times may vary according to different reasons such as the entry of different competitors on market or seasonal demand, safety stock should be optimized accordingly. At the planning (tactical) level, safety stock can be controlled according to each planning horizon to satisfy customer demand at lower cost instead of being fixed by a decision taken at the strategic level. On the other hand, most studies that consider safety stock optimization are tied to a specific system structure such as serial, assembly, or distribution structure. This research focuses on formulating two different models. First, a multi- echelon safety stock optimization (MESSO) model for general supply chain topology is formulated. Then, it is converted into a robust form (RMESSO) which considers all possible fluctuation in demand and gives a solution that is valid under any circumstances. Second, the safety stock optimization model is integrated with tactical supply chain planning (SCP) for manufacturing systems. The integrated model is a multi-objective mixed integer non-linear programming (MINLP) model. This model aims to minimize the total cost and total time. A case study for each model is provided and the numerical results are analyzed.

In this paper, we minimize the holding cost of the safety stock in the supply chain subject to linear constraints on the service times between the nodes of the network. In the problem, the objective function is concave as we assume the demand to be bounded by a concave function. The optimal solutions of the problem belong to the set of extreme points of the polyhedron, specified by the constraints of the problem. We first characterize the extreme points for the two-layer networks and then provide bounds to use in a branch and bound algorithm. / Singapore-MIT Alliance (SMA)

Undersökningen är uppbyggd av en kvantitativ fallstudie, där en datainsamling i form av företagsinterna dokument och intervjuer har utförts för att kunna besvara studiens syfte och frågeställningar. För skapa ett underlag som ska styrka den insamlade datan från fallstudien har även en sökning efter lämpliga teorier och metoder genomförts med fokus på studentlitteratur och vetenskapliga artiklar tillhörande ämnesområdet. Syftet med denna studie är att optimera antalet cylindrar på Linde Gas AB i Enköping genom att effektivisera materialflödet för industrigaser på anläggningen. Den pågående centraliseringen av Lindes fabriker, där flertalet verksamheter konsolideras till Enköping, bidrar till ett överskott av cylindrar. Ett överskott som skapar oreda bland cylindrarna i det operativa flödet. Detta leder i sin tur till onödigt långa körtider för truckförarna att hämta och lämna cylindrar på lagerhållningsytan, där både tomma och fulla cylindrar lagerhålls. Resultatet av studien visar på en viss osäkerhet i systemtillförlitligheten, vilket innebär att lagersaldot som redovisas i systemet inte överensstämmer med det verkliga lagersaldot. Detta visar därmed på en låg grad av lagersaldosäkerhet i det systemstödet SAP. Resultat från intervjuer och granskning av dokument indikerar även på att det finns ett överskott av cylindrar på anläggningen i Enköping, men på grund av osäkerheten i lagersaldot är det omöjligt att göra en kvantifierad bedömning av hur stort överskottet är. Av resultatet framgår även att det finns två typer av överskott, ett permanent överskott och ett säsongsvarierande överskott. Studien kommer därmed fram till att de överskottscylindrar som inte tillför någon nytta i det operativa flödet bör förflyttas till en alternativ lagerhållningsyta på anläggningen i Enköping. De säsongsvarierande produkterna beräknas återgå till det operativa flödet inför högsäsong igen medan det permanenta överskottet inte beräknas återgå till det operativa flödet utan bör snarare undersökas vidare för eventuell förflyttning till en annan anläggning. Analyser av resultatet med hjälp av metoder och verktyg som processkartläggning, materialflödesanalys, processanalysschema samt kostnadsanalyser genererar slutligen ett förbättringsförslag i form av en rutinbeskrivning för hur Linde bör hantera det överskott som finns. Denna rutinbeskrivning bör utifrån ett lean- och ekonomiskt perspektiv implementeras tidigt i materialflödet för att undanflyttningen ska generera en besparing i form av att eliminera slöserier som överproduktion, onödig truckkörning och stora buffertlager. De slutsatser som dras är dock att Linde bör uppdatera sina grundläggande stödprocesser för bland annat utförandet av inventeringar, innan en implementering av den rutinbeskrivning som tagits fram i denna studie är möjlig att genomföra. / This is primary a quantitative case study based on data that has been collected in terms of internal documents and interviews. This has been done to make sure to answer the purpose and questions of statement in this study. In order to create a foundation that will support the data collected from the case study, suitable theories and methods has also been collected by focusing on student literature and scientific articles related to the subject area. The purpose of this study is to optimize the number of cylinders at Linde Gas AB in Enköping by mapping the material flow for industrial gases at the plant. The ongoing centralization of Lindes´ plants in Sweden, in which some plants are consolidating their operations to Enköping, contributes to an excess of cylinders. An excess that creates disorder among the cylinders in the operational flow. This also leads to unnecessarily long driving times for truck drivers to pick and unload cylinders on the storage location, where both empty and full cylinders are being stored. The results of the study are showing a certain insecurity in the system reliability, which means that the stock levels that are reported in the system do not match the actual stock levels at the site. This indicates a low degree of stock accuracy in the support system SAP. Results from interviews and reviews of documents also indicates that there is an excess of cylinders at site in Enköping, but uncertainties in stock accuracy makes it impossible to estimate the extent of the excess there is. The result also shows that there are two types of excess, a permanent excess and a seasonally varying excess. The conclusion is that the excess cylinders that do not add any benefit in the operational flow should be moved to an alternative storage area at the plant in Enköping. Where the seasonally varying products are expected to return in the operational flow in times of high season, while the permanent excess is not expected to return in the operational flow, but should instead be further investigated for possible relocation to another facility. Analyzes of the results has been made by using methods and tools in terms of process mapping, material flow analysis, process analysis schedule and cost analysis. This is generating an improvement proposal in terms of a routine description of how Linde should handle the excess at site. This routine description should be based on a lean- and economic perspective, being implemented as early on in the material flow as possible to make sure that the transportation of cylinders will be generating savings in order to eliminate waste, such as overproduction, unnecessary truck driving and large stocks. The conclusion is however that Linde should update their supportive processes of how inventories should be done, before an implementation of the routine description presented in this study is possible.