Economic evaluation in decision models: a critical review and methodological propositions

International audienceDecision models of industrial management articles are often based on an economic criterion to find the proposed solution. They use economic parameters that are generally imported from the firm cost accounting system. When cost information is not adapted to the decision, the obtained solution of the model may be invalid. In this article, we deal with a critical literature review to report the methodological problems encountered in industrial management articles vis-à-vis the used costs. Finally we suggest methodological propositions to be kept in mind by authors when they are using costs in decision models

Modelling the tactical decisions for open-pit mines

Open-pit deposits are often characterized by a stack of layers of different geological nature. Some layers are worthless while the ore of the others is of a varying economic value depending on grade. To reach a layer, it is necessary to have first removed the upper layers above the extraction zone. This action results in uncovering the layer in this particular place and in facilitating access to the layers below. This process involves a series of 2 to 7 operations; each one is performed by a machine, some of which are able to perform up to 3 different operations. Ensuring the consistency of mining extraction scheduling over a few months, in order to meet known or forecast demand, is a challenging task. A mining extraction model based on mathematical programming has been proposed but it is hardly usable due to its size. A Discrete Events Simulator modelling is currently being tested to measure the impact of dynamic rules used to allocate the machines and select the target mining area

Reverse Blending: an efficient answer to the challenge of obtaining required fertilizer variety

Mass customization, a major trend in modern economy, relies on components assembly in discrete production, while in continuous production, it consists in a sequence of batches of different products. This limits achievable diversity and multiplies transportation issues. This situation is addressed by the fertilizer industry which, to enable sustainableagriculture, must deliver fertilizers tailored to soil and crops characteristics. We are now proposing a new approach to handle this situation, with a solution called reverse blending, which involves delayed differentiation performed near end-users. This consists in defining the components for a very limited number of inputs whose blend exactly matches the characteristic of the required fertilizers. In this solution, the problem is modelled by a quadratic program used to define input optimal composition, respect fertilizer components constraints and cater to any type of demand. Reverse blending may have a major impact on supply chain organization. A short case study of this new approach is provided

Rendement et efficience du transport: un nouvel indicateur de performance

National audienc

Évaluation économique du pilotage opérationnel - une application aux décisions d’ordonnancement d’un atelier d’engrais

Operational management is based on decisions that are related to resources use on the short and medium runs, to meet the objectives that the one wants to achieve over this horizon. The purpose of this article is to show that the study of the choice between several alternative operational decisions requires an appropriate economic evaluation. The full costs provided by traditional cost accounting are not sufficient and relevant for the study of decisions with short run impact. The evaluation of operational decisions requires i) the use of activity drivers that are not related solely to production volume; ii) the exclusion of costs that are not affected by the studied decisions; iii) taking into account opportunity costs. We will illustrate the proposed approach for the economic evaluation of operational decisions, by a real choice example of fertilizers production orders scheduling on parallel and heterogeneous production lines in one of the OCP Group fertilizers plants. We will show that the full costs of traditional cost accounting are not relevant to the study of this type of decision. Their use leads to results that are distorted. The proposed principles remain general and adaptable to the other operational decisions study.Le management opérationnel concerne les décisions relatives à l’utilisation à court et moyen termes des ressources pour répondre aux objectifs que l’on cherche à atteindre sur cet horizon. L’objectif de cet article est de montrer que l’étude du choix entre plusieurs décisions opérationnelles alternatives nécessite une évaluation économique appropriée. Les coûts complets fournis par la comptabilité de gestion traditionnelle ne sont pas suffisants et pertinents pour l’étude des décisions ayant un impact à court terme. L’évaluation de décisions opérationnelles nécessite i) l’usage d’inducteurs d’activités qui ne sont pas liés uniquement au volume de production ; ii) l’exclusion des coûts qui ne sont pas impactés par les décisions prises ; iii) la prise en compte de coûts d’opportunité. On illustrera la démarche proposée pour l’évaluation économique de décisions opérationnelles, par un exemple réel de choix d’ordonnancement d’ordres de fabrications (OF) d’engrais sur des lignes de production parallèles et hétérogènes dans l’un des ateliers d’engrais du Groupe OCP. Nous montrerons que les coûts complets de la comptabilité de gestion classique ne sont pas pertinents pour l’étude de ce type de décisions car leur usage mène à des résultats qui sont baisés. Les principes proposés restent généraux et adaptables à l’étude d’autres décisions opérationnelles

Vehicle Routing Problem with Roaming Delivery Locations and Stochastic Travel Times (VRPRDL-S)

International audienc

The reduction of greenhouse gas emissions from freight transport by pooling supply chains

International audienceIt is well known that freight consolidation is an effective way to improve the utilization of logistics resources. In fact today, this policy is locally and fragmentally implemented at the operational level. We propose here to explore the environmental impact of pooling of supply chains at the strategic level (merging supply chains). With real data from two main French retailers and through an optimization model, we compute CO2 emissions for two transport modes, road and rail. As regards the general dependency of the emissions produced by the modes of transport on their loads, the emissions functions of the two modes are both piecewise linear and discontinuous functions. The supply network pooling proposed here is an efficient approach to reducing CO2 emissions. Even if the attention is focused on the emissions, the transportation costs are also studied and analyzed

The reduction of greenhouse gas emissions from freight transport by merging supply chains

International audienc