competitive advantage from production and supply … advantage from production and supply chain...

2015 Honeywell Users Group

Europe, Middle East and Africa

Competitive Advantage from Production and Supply Chain

Excellence

Satyendra Dubey, Honeywell

2 © 2015 Honeywell International All Rights Reserved

SCOR model as basis of Excellence

Industry recognized model driving production and supply chain excellence

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Supply Chain

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SCOR Model

Deliver Make Source

Plan

Source Make Deliver

Process, arrow indicates material flow direction

Process, no material flow Information flow

Return Return

• Supply Chain

Operations Reference

model

‒ Process framework

Standard processes

Standard metrics

Standard practices

Created by SCC

‒ Since 1996

‒ Over 800 companies

‒ 40% owner operators


Performance drives competitive advantage

SCOR model drives performance of key attributes > sustainable competitive advantage

Performance Attribute Area of competitive advantage

Reliability Consistently getting the orders right, product

meets quality requirements

Responsiveness The consistent speed of providing

products/services to customers

Agility The ability to respond to changes in the market

(external influences)

Cost The cost associated with managing and operating

the supply chain

Assets The effectiveness in managing the supply chain’s

assets in support of fulfillment

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Mapping SCOR to Process Industry

Inbound

logistics Production

Outbound

logistics

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SCOR Model

Deliver Make Source

Plan

Source Make Deliver

Return Return


Mapping SCOR to Process Industry

Inbound

logistics Production

Outbound

logistics

Integrated Planning

Production Planning Distribution Planning

Supply & Demand Balance

Production Accounting &

Management

Outbound Logistics

Management

Inbound Logistics

Management

Downtime Management

Scheduling

Su

pp

ly

Dem

an

d


Comprehensive Footprint

Comprehensive, scalable and integrated suite of services, products and solutions

Integrated Planning

Production Planning1 Distribution Planning


Plant Manager4 Port & Marine Manager5 Mine Logistics Manager

Production Accounting & Reconciliation Production Form Plan Vs Actual3

Downtime Management

Scheduling 2

Supply chain

baseline

assessment

SCPM Master

Planning

Integration

Services

Model audit

and assurance

services

Covered in detail


Integrated Planning

Optimize across supply, production, sales & distribution

Supply Production Sales &

Distribution

• Maximize netback or

minimize cost

• Maximize sales ,

minimize logistics cost

• Maximize production

margins and

throughputs of

individual plants in silo

Optimize across silos

Multi site organizations can increase their margins by

more than 300 basis points by deploying integrated

planning process that optimizes the entire supply chain

for the enterprise.

Use Refinery and Petrochemical Modeling

System (RPMS) multi plant for

• Enterprise level production and distribution planning

(Budgeting, Quarterly, Monthly)

• Feedstock evaluation and selection (Term and spot

contracts), exchange agreements

• Investment analysis (new production or distribution

infrastructure) and strategic decisions

• Logistic costs or

demand not considered

• Synergy between plants

not considered

• Marginal production

costs not considered

• Demand & production

constraints not

considered

Performance Attribute

SCPM Responsiveness: Reduction in planning cycle

times

SCPM Agility: Capture opportunity trades

SCPM Cost: Reduce feedstock and production costs

SCPM Assets: Increased revenue from profit mix

optimization, new investment optimization &

debottlenecking

Benefit


RPMS 510: Release 30th Oct 2015



Sales, inventory and operations planning and coordination across

supply chain

Ideally suited for bulk supply chains where inventory

management is key and demurrage can be significant

Use Capacity Distribution Planner (CDP) for

• Integrated sales, inventory and operations planning for

complex supply chains

• Inventory forecasts and control for planning horizon

• Collecting actual data and plan vs actual

• Make plans by balancing supply and demand for simpler

supply chains

Planning &

Scheduling systems

Accounting systems,

actual data

Manual

Inputs

Integrated reporting

Plan visualization

Revise

Review Current

Plan

Approve

Supply Inventory

Dispatch

Forecast

positions

Day 1

Day 2

Day 3 . . .

Profit/day


SCPM Reliability: Reduction in demurrages & stock outs

SCPM Responsiveness: Reduction in fulfillment cycle times

& replenishments

SCPM Agility: Capture opportunity trades,

SCPM Assets: Increased utilization of supply chain assets

Benefit


CDP 230: released 19th Oct 2015

PlanningStaff

CustomerSupportStaff

CommercialStaff

Shareholders & Stakeholders

Customers

MaintenanceStaff

Field Data

Business Data

Collaborative Environment

CDP

• Key Enhancements:

‒ Enable a multi-level approval workflow;

‒ Enable plan revisions consolidation which brings performance

improvements;

‒ Enable Gantt chart view provider for Data Objects;

‒ Enable localization on Data Objects, and

‒ Platform upgrades (PCC250, Infragistics V15.1, SQL Server 2012,

Windows Server 2012 R2, Office 2013)


Production Accounting and Reconciliation

Accurate production data that helps business take

better economic decisions with reduced uncertainty

• Increased reconciliation accuracy which leads to reduction in

losses up to 1% and improves decision making capability

which helps deliver a margin improvement of up to 5%

• Integrated graphical workflow environment and “best in class”

reconciliation solver helps close balances up to 20% faster

and reduces learning time by up to 20% for new engineers

ensuring sustained delivery of benefits

Use PAR for

• Complex wide or Unit Specific material balances in mass

or volume units

• Multi Component balances for Mineral processing

industries

• Inventory calculation using built in VCF calculations as per

API standards

• Supports AMIRA P754 metal accounting guidelines

Receipts

Measured,

Interfaced

or Manually

Entered

Feeds

Inventory

Mass/Volume

Intermediates Products

Inventory

Mass/Volume

Shipments

Measured,

Interfaced

or Manually

Entered

Process

Unit

Process

Unit

Process

Unit

Reconciled Production/consumption & Inventory position by product

Losses, Missing Movements, Meter Maintenance

Planning

Systems

Scheduling

Systems

Simulation

Systems ERP

Enterprise

Dashboard

Benefit


SCPM Reliability: Reduction in shipment and invoicing

errors, increased planning model accuracy

SCPM Responsiveness: Reduction in accounting cycle time

SCPM Costs: Reduction in Fuel and Loss


PAR 200: Released June 2015

• Graphically create

accounting model

• Bulk Configure

Models

• Model Versioning

• Model Tuning

• Automatic collection

from Historian /

Movement Systems

• Manual Movement

entry

• Import movements

from Excel

• Graphically

highlight balance

issues

• View Production

Metrics

• Perform Simple

balances

• Range Constraints

• Loss Modelling

• Solver Diagnostics

• Missing Movements

solver

• Notifications &

Approval workflow

• Data Auditing

• Standard/Custom

Reports

• Excel Analytics

• Historian Writeback

Configure

Production Model

Collect

Production Data

Perform

Initial Analysis Perform Statistical

Reconciliation

Collaborate

Modular Accounting

Models

Flexible Data

Collection Methods

Intuitive visual aids and metrics for

faster analysis

Multiple Mechanisms

to view Information

Dashboard

Historian

Easier to Build,

Learn & Maintain

Secure & Seamless

Data Collection Faster identification of Key Errors

Reliable, Fast & Extensive Information

Availability


Base Lining Services

Baseline and improve supply chain and production management practices

and models

Rich technology and domain

experience enables Honeywell

to provide tailored consulting

based on customer needs

Use Honeywell SC&PM services for

• Baseline current supply chain and production

management processes against the industry best

practices

• Developing improvement roadmap to achieve best in

class status

• Model review and audits of supply chain and production

management models

Supply chain

baseline

• Based on SCOR model applied to process

industry

• Honeywell best practice repository

• Standardized questionnaire & scoring

Best in class

roadmap

• Roadmap to address gaps based on

unique supply chain characteristics and

complexity. Highlights low hanging fruits

such as process enhancements, training

and review metrics.

• Also highlights needs for small and large

project based improvements

• Recommends phased approach that pays

for itself

Model audit and

assurance

• LP and accounting model reviews

• Set up assurance and back casting

processes

Interviews1 Mapping as-is process2 3 Standard way of scoring, Baseline of

as-is

4 Detailed gap assessment

5 Supply chain complexityDevelop roadmap based on baseline

score, gaps and complexity6


Integration Services

Orchestrate different functions to maximize opportunity

capture using Honeywell’s standard integration framework

• LP and accounting model reviews

• Set up assurance and back casting

processes


Vertical Solutions

Performance

Attribute

Area of competitive advantage

Reliability Reduction in re blends (15 to 45 cents per barrel of product), Increase in on time delivery, Reduction in demurrages

(10%), Reduction in shipment errors

Responsiveness Reduction in cycle times (Planning, Accounting processes etc.) up to 20%, Order fulfillment cycle time

Agility Increase in proportion of spot trades, Minimize impact of unplanned events (e.g. vessel late arrival, customer

shutdown, production slowdown), Reduction in tank top or tank bottom

Cost Reduction in feedstock cost, Reduction in Fuel and Loss (0.1 to 0.3%), Identification of downtime events and support

proactive maintenance, Productivity of SCPM personnel, Inventory carrying costs

Assets Increased revenue from product mix optimization, New investment optimization, Debottlenecking

Typical Benefits


SC&PM Customers

Customers Served

By Industry By Geography

Petrochemicals Refining

O&G Consulting

31+ sites 70+ sites

12 sites 10 sites

Sample Customers

Americas

50+

sites

EMEA

50+

sites

APAC

100+

sites

On each Customer site, more than one product

MMM 70+ sites


Contact Honeywell for SCPM Base Lining & Master Planning

[email protected]

competitive advantage from production and supply … advantage from production and supply chain...

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