Connecting locations with intelligent network planning

The Client

Holcim builds progress for people and the planet. As a global leader in innovative and sustainable building solutions, Holcim is enabling greener cities, smarter infrastructure and improving living standards around the world. With sustainability at the core of its strategy Holcim is becoming a net zero company, with its people and communities at the heart of its success. The company is driving the circular economy as a world leader in recycling to build more with less. Holcim is the company behind some of the world’s most trusted brands in the building sector including ACC, Aggregate Industries, Ambuja Cement, Disensa, Firestone Building Products, Geocycle, Holcim and Lafarge. Holcim is 70,000 people around the world who are passionate about building progress for people and the planet through four business segments: Cement, Ready-Mix Concrete, Aggregates and Solutions & Products.

Balancing supply and demand

by taking into account the market situation and other parameters during planning.

With a consistently high service level for the customers:

Lower costs

Make-or-buy
decisions

supported by what-if scenarios on a strategic level.

Through balanced utilization of production capacity and reduction of inventories:

Increased
efficiency

Network planning in anticipation of future challenges

The goal of the project was to ensure the cost-optimized production and delivery of cement to end customers within a complex network consisting of many international production and warehouse sites. To reflect the real business challenges into the mathematical algorithm, the project team has been working closely with business functions, including Sales, Production, Logistics and Finance, aiming for even more reality-based optimization outcomes.

The project details are explained in the following:

The AIM

By using NetOp-OPTANO, the organization should be able to anticipate and respond proactively to future challenges. This involves ensuring the correct evaluation of relevant options and achieving value capture through proper network design. This should foster the company’s ability to optimally plan all strategic and tactical options required for its business activities.

How to anticipate future challenges and be able to repond proactivly?
Planning quality and time are in focus when planning an extremely complex supply chain.

The Challenges

Holcim is a customer-centric company, which means that each customer is to be supplied at the desired time, in the desired quantity and quality at the best possible price. Supply chain management is correspondingly complex and takes place at national level. In a dynamic business environment with heavily fluctuating market demand, volatile raw material and energy costs, multi-echelon supply networks as well as unexpected machine failures, it is crucial to make optimal decisions on daily business operations. Complex interdependencies and cross-dependencies must be taken into account in the planning process. The factors of planning quality and time are therefore of decisive importance.

The Result

NetOp-OPTANO supports strategic decision-making processes with what-if scenarios related to the supply network. It facilitates the identification of the best supply model, capacity utilization of plants and equipment, and the best sourcing alternatives. This solution enables optimization of the supply network, taking into account production and logistics costs, selling prices, demand, capacities, and constraints in production, storage, and logistics.

Tangible achievements by applying NetOp-OPTANO are:

  • balancing supply and demand to support S&OP processes
  • cutting costs while maintaining customer service levels
  • reducing inventory
  • optimal make-buy decisions
  • footprint review
What- if scenarios for the best solution.
What, from your point of view, was the biggest challenge you faced in implementing the solution?
Usability was a very important feature for the customer. An optimization run had to take less than five minutes. This was no easy challenge with such a huge data volume. We had to come up with quite a few ideas to squeeze the ultimate performance out of it.
Is there anything in the project that you’re particularly proud of and, if so, why?
Although the company was already using a planning solution, it was still willing to invest in OPTANO. This reflects the high level of confidence in our application and demonstrates the potential of the software. OPTANO developers put their heart and soul into their work and such a vote of confidence is always a good feeling.
What do you value most about your collaboration with the customer?
This is the first time I was able to work in such an international team. The IT- project management was in Canada, the project team was made up of specialists from Canada and France and the core users were, of course, from Brazil and Europe. The team dynamics were very positive and the interaction was a rewarding and fascinating experience.

Dr. Dominik Hollmann

OPTANO Project Manager

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