Design and optimization of global distribution supply chain at McCain Foods

Abstract

Network design has been successfully used by numerous organizations to achieve supply chain excellence through cost effectiveness and superior utilization of resources. This thesis addresses how network optimization methods can be used to provide guidance in the process of creating a company's global supply chain strategy. In order to demonstrate that this approach can be a source of considerable value for an organization, we collaborated for a period of six and a half months with McCain Foods in the creation of their supply chain strategy plan. In the past McCain has managed its capacity and distribution from a regional perspective. While this method has historically produced good results, the size of the company and the challenges ahead justify now a more global approach. To fully leverage McCain's global scale, we conducted a comprehensive study of the supply chain, analyzing possible scenarios and highlights optimal strategies for future growth plans. For this purpose, we created a global supply chain model using LogicNet Plus, representing the movement of finished products from all French fry plants to all markets. From the analysis of the model, recommendations have been produced for McCain's senior leaders and board, and used in the definition of the 5-year strategic plan. To comply with the tight deadlines of the high-level decision-making process of the organization, the model uses highly aggregated and easily available data, yet it can represent reality with sufficient accuracy. The results of the study clearly show how this kind of analysis is able to provide significant input for the definition of a supply chain strategy, and to highlight opportunities for substantial cost savings in a global supply chain network.