COST ANALYSIS OF STEEL LOGISTIC NETWORK
GM was eager to investigate their steel raw material supply chain and analyze the costs involved in steel logistics. The main goal of this project was to provide a steel logistics cost analysis model to examine freight rates for negotiating future supplier freight rates.
The Tauber team performed a cost analysis on current GM-controlled business and then leveraged that information to expand the analysis to the remaining supplier-controlled freight. The team characterized the logistics structure of the steel network and then replicated costs for freight, warehousing, material handling, and management to develop a comprehensive cost model to compare to the supplier freight rates. The model simulates the logistics setup of the supplier and provides a rate per metric ton to compare to the supplier’s rate per metric ton. The team also delivered a user interface of the model for future use to update data and view the new saving analysis.
Read the 2017 General Motors Company - Supply Chain Team Project Executive Summary in the 2017 SPOTLIGHT! book.
Bethany Daniel –EGL (BSE Mechanical Engineering & MSE Industrial and Operations Engineering)
Ruoxi Li–Master of Supply Chain Management
Matt Naef–Global Commodity Manager, Body Commodities (Steel/Aluminum/Paint)
John Robertson–Shop Director, Supply Chain, Global Assembly Warehousing
Brian Watanabe–CT Lead for Non-Fab Aluminum Sheet
Mariel Lavieri –College of Engineering
Jim Price–Ross School of Business
About Tauber Team Projects:
The 2017 Tauber Team Projects resulted in $575 million in savings according to sponsoring company calculations, an average of $18.5 million per project over 3 years.