Tata Steel UK – Shut or Save UK Steel plants
£1 million per day loss to £1m per day profit
About Tata Steel UK:
A major player in the UK economy, it has a turnover of more than £2bn, over 8,500 employees and ships over 300m tonnes of steel per year. 60% of the steel produced is for the UK market 30% to Europe and 10% to the rest of the World.
After managing a successful turnaround of part of the business there was a major hurdle in the plates business. Traditional methods had failed to improve the business and the board announced that the business would be closed unless it could show a way of moving from losing £1 million per day to making £1 million per day. At this point we were asked to help.
We determined that the best way of approaching the problem was to use the Enterprise Digital Twin to build a set of simulation models that can adequately represent the steel supply chain with all its volatility, uncertainty, complexity, constraints & ambiguity (VUCCA) and then use these models to determine:
1.The primary cause of past performance gaps
2.The likely operational & financial impact of the changes
3.To identify and test new, potentially counter-intuitive, planning and execution rules to be implemented in SAP
1.Fully documented ‘old’ rules / heuristics that had been used
2.Identified best options to reduce congestion during peak production raising throughput, lowering WIP and lowering costs
3.Significantly lowered the overall cost per tonne
4.Allowed for rules to be fully automated into the SAP system
5. Provided management with a ‘safe environment’ for ongoing decision support