Optimal Production Planning

Companies in the Consumer-Packaged Goods Industry are faced with a chronic dilemma: efficiency vs. agility. Companies must balance scale, which creates cost-saving opportunities, and flexibility, which often incurs incremental costs. Following extensive cost structure analysis and mapping of the company's supply chain network, a comprehensive Mixed Integer Linear Programming model was created. The model's objective function is cost minimization, which it must attempt considering "current-state" inputs and multiple operational constraints. The results suggest that a hybrid production planning strategy between "level-production" and "demand-chase" is preferred, and can generate significant cost savings. In summary, this strategy can help companies enhance their efficiency and reduce costs when optimizing the total end-to-end supply chain, instead of using department-based budget management.

Autorentext

Omar Sakr specializes in Manufacturing and Supply Chain, with six years in two global Consumer Packaged Goods firms, covering stints in Operations, Industrial Engineering, and Supply Chain. He has supplemented his work experience with a Master's Degree in Supply Chain Management from MIT, and has been working in the Netherlands since 2021.