Customer Centric Inventory Modelling – Shell Chemicals

 Overview

Company Description

We are a global group of energy and petrochemical companies with more than 80,000 employees in more than 70 countries. We use advanced technologies and take an innovative approach to help build a sustainable energy future.

Project Description

Project description:

The student will become part of the central Supply & Optimization team of Shell Chemicals in Europe.

This project forms a great opportunity for a student that wants to learn about supply chain planning and value chain optimization and how this drives value in Shell’s Chemicals business.

The supply chain includes processing raw materials (for example naphtha or bio naphtha) to produce base chemicals and further processing these chemicals in combinations of other products into derivative chemicals. Across each of these steps there are choice-points to either sell or continue to produce the derivative chemical. The goal of the value chain optimization at Shell Chemicals is to generate value (margin) from assets and selling the right products in our markets. This is driven by the monthly Supply and Operations Planning (S&OP) cycle which is led by the Optimization team and produces the plan for the upcoming three months. The Supply teams operationalize this monthly plan and (as part of the natural working team for the value chain) deliver the daily and weekly (optimization) decisions to deliver to our customers, handle disruptions and maximize value.

Current inventory levels are based on average service levels/DOIs per product and not differentiated by individual customer requirements. To further optimize inventory investment (ie. working capital) and strategically serve our customers, Shell has developed a customer centric inventory modeling approach. This supply project targets tailoring the new inventory modelling approach to several of our Product Lines in collaboration with the Sales and Marketing teams to further optimize margin and inventory investment.

Goals of the project:

More focused approach on inventory setting and thereby optimizing the working capital spend in line with business results and customer service levels

Deliverables:

• Defining service level assumptions at product line and customer level based on business considerations, including profitability, alternative supply, and contract status
• Determining the inventory and supply strategic intent according to customer categorization and
• Calculating the revised target inventory level and determining the resulting working capital reduction and potential margin optimization opportunities per product line.
• Measuring performance of the set inventory targets against ambition

Essential student knowledge:

• Maintenance and reliability engineering knowledge
• Programming skills
• Data analysis skills

More information: escf@tue.nl