Improving throughput and profitability through dynamic modeling in the steel industry

Initial situation

A global steel producer of coils wanted to improve throughput and profitability at its American plant
A difficult market forced low prices, which led to disappointing EBITDA results despite increased production volumes
Management had a strong paradigm to increase volume and focus mainly on OEE
The lack of coordination between sales and production prevented improvements in pricing and product mix
In order to achieve significant improvements, a holistic approach was required, supported by a digital twin

Increased throughput at the bottle neck

Profitability increased

Green and Black Belts trained

Perform value stream design and build a digital twin
Record actual status, define target status and simulate future process performance using dynamic modeling and increase throughput at the bottleneck
Implement kaizen to reduce complexity
Define stock levels for raw material and replenishment logic and implement slab supermarket
Define coil sequence and production planning logic
Coordinate implementation plan with buy-in from managers and employees and validate financial benefit estimate with Controlling

Improving stock turnover and the speed of the supply chain

Securing acceptance and commitment through a collaborative approach to strategy development

Acceleration of the supply chain through a value stream-oriented target image in stainless steel processing

Ensuring the predictability of an S/4HANA transformation through a business-oriented preliminary project

All cases

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