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GE Plastics Optimizes the Two-Echelon Global Fulfillment Network at Its High Performance Polymers Division

Author

Listed:
  • Rajesh Tyagi

    (Information and Decision Technologies, GE Global Research Center, Niskayuna, New York 12309)

  • Peter Kalish

    (Information and Decision Technologies, GE Global Research Center, Niskayuna, New York 12309)

  • Kunter Akbay

    (Information and Decision Technologies, GE Global Research Center, Niskayuna, New York 12309)

  • Glenn Munshaw

    (Johns Manville International, 1465 17th Avenue, McPherson, Kansas 67460)

Abstract

To achieve the highest customer satisfaction at the lowest costs, GE Plastics adopted a global approach to its manufacturing operations. Previously it met demand in one geographic region with production from that region only. It developed a decision-support system (DSS) to optimize the two-echelon global manufacturing supply chain for its high performance polymers division. The DSS uses a math-programming model to maximize contribution margin while taking into consideration product demands and prices, plant capacities, production costs, distribution costs, and raw material costs. The results of the model are the optimal production quantities by plant and the total contribution margin. The DSS is implemented in Excel and uses LINGO to solve the optimization model. After successfully implementing this system at the high performance polymers division, GE Plastics is rolling it out to other divisions.

Suggested Citation

  • Rajesh Tyagi & Peter Kalish & Kunter Akbay & Glenn Munshaw, 2004. "GE Plastics Optimizes the Two-Echelon Global Fulfillment Network at Its High Performance Polymers Division," Interfaces, INFORMS, vol. 34(5), pages 359-366, October.
    • Handle: RePEc:inm:orinte:v:34:y:2004:i:5:p:359-366
    DOI: 10.1287/inte.1040.0088
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    Cited by:

    1. Burcu B. Keskin & Halit Üster, 2012. "Production/distribution system design with inventory considerations," Naval Research Logistics (NRL), John Wiley & Sons, vol. 59(2), pages 172-195, March.
    2. Larry J. LeBlanc & Michael R. Galbreth, 2007. "Implementing Large-Scale Optimization Models in Excel Using VBA," Interfaces, INFORMS, vol. 37(4), pages 370-382, August.

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