Blending OR/MS, judgment, and GIS: Restructuring P&G's supply chain

Blending OR/MS, judgment, and GIS: Restructuring P&G's supply chain

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Article ID: iaor1998243
Country: United States
Volume: 27
Issue: 1
Start Page Number: 128
End Page Number: 142
Publication Date: Jan 1997
Journal: Interfaces
Authors: , , , , ,
Keywords: decision: applications
Abstract:

In 1993, Procter & Gamble (P&G) began an effort entitled strengthening global effectiveness (SGE) to streamline work processes, drive out nonvalue-added costs, and eliminate duplication. A principal component of SGE was the North American product supply study, designed to reexamine and reengineer P&G's product-sourcing and distribution system for its North American operations. The methodology developed to solve this problem drew on OR/MS and information technology, merging integer programming, network optimization models, and a geographical information system (GIS). As a result of this study, P&G is reducing the number of North American plants by almost 20 percent, saving over $200 million in pretax costs per year and renewing its focus on OR/MS approaches.

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