The document discusses using supply chain simulations to model a 3M supply chain and identify opportunities for improvement. It describes simulating the supply chain's daily operations to see costs and performance, looking for points of failure, testing changes to products, facilities, vehicles and routes, and exploring ways to lower both costs and carbon footprint through synchronization, reduced inventory, and vehicle selection. The goal is to find solutions that improve the supply chain's efficiency and sustainability.

1. Supply Chains for a Changing World
Reducing Inventory, Cost and Carbon Footprint
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2. Supply Chains Need Improvement
Here’s an article
from the WSJ about
one such supply
chain
(http://online.wsj.com/news/articles/SB10
001424052702303877604577382260173
554658 )
Supply chains that
were once good
enough, now have to
get a whole lot better
Let’s explore some
different ideas to
get the improvement
we need…
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3. Model the Supply Chain and Simulate Operations
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4
2
1
Define:
- Products
- Facilities
- Vehicles
- Routes
We’ll model that 3M supply chain and use supply chain simulations to
find opportunities for improvement
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4. Define Products and Facilities
ies
ilit
c
Fa
ts
uc
d
Pro
First we’ll describe the characteristics and costs of the products and
facilities in this supply chain
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5. Define Vehicles and Routes
s
icle
h
Ve
tes
ou
R
Then we’ll describe the vehicles and routes that move products
between the facilities
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6. Simulate Supply Chain Performance
Real-time cost and
performance data
And then, we’ll run a simulation of the supply chain to see its daily
operating costs and performance levels
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7. See Points of Failure
re
ilu
a
fF
o
nt
i
Po
A problem is found on day 6 – the factory in Indiana runs out of needed
product… let’s explore different ways to solve this problem
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8. Download Data for Analysis
ta
Da
ad
n lo
w
Do
Online graphic and numeric displays show what happened; we can
download simulation data to spreadsheet for further analysis if needed
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9. Make Changes to Products and Facilities
Let’s try increasing the product on-hand amount and increasing product
storage capacity at the plant in Indiana
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10. Try Different Vehicles and Routes
What would happen if we increase the truck size and drop quantities of
product delivered to the factory in Indiana?
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11. Supply Chain Performance Getting Better…
Supply chain runs longer now before problem appears (16 days), but
operating costs and carbon footprint went up – can we do better?
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12. Different Vehicles Can Lower Carbon Footprint
Fast and
responsive
(high carbon)
Efficient and low cost
(lower carbon)
Fast and
responsive
(low carbon)
What would happen to costs and carbon footprints if we used more
efficient and more low carbon vehicles?
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13. Find Ways to Lower Both Cost and Carbon
Get lower costs by synchronizing production and demand while reducing
inventory and storage. Lower carbon footprint by using different vehicles.
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14. The Future is Yours…
There are no right answers – only better answers
Simulations show you which answers are better
Model new or existing supply chains anywhere in the world
Academic and commercial versions available - www.scmglobe.com
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