Supply Chain Modeling For Oil Companies: In The Case Of Libya Oil Ethiopia Limited
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Date
2017-06
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Addis Ababa University
Abstract
The purpose of this paper was to highlight the oil supply chain performance in fulfilling its customers need, analyze the essential characteristics of sustainable SCM in the oil company, identify the main challenges and opportunities of oil supply chain in the oil company, develop strategies to improve forecasting problems and delivery performance of the Ethiopian oil supply chain performance and to develop an integrated oil supply chain model from the depot to the end customer. No research has been conducted regarding oil supply chain simulation in Ethiopia.
A Discrete-Event Simulation model of SCM is constructed using Arena software to implement the four-target scenarios. This study focuses on filling the gaps and develops a four-echelon supply chain model with the help of Arena simulation software to investigate and improve the Ethiopian oil industry supply chain performance with a special focus on the downstream suppliers of oil.
This paper analyses the oil supply chain operations and proposes four supply chain scenarios. Four scenarios on the inventory replenishment strategy for the oil industries are developed. After running the trials, a significant method to control the inventory level of the oil while keeping the operating performance in a reasonable level is achieved. The outputs are also analyzed to share inventory stock information and help assigned SC managers to make decisions based on facts rather than assumptions in uncertain environment. The simulation results show the optimal supply chain strategy that demonstrates the best economic performance in the oil industry.
The research recommends the application of the developed model for all oil industries with slight modification of the model and the input data provided for the purpose of making this study more realistic and applied in the oil industry
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Keywords
Supply Chain, Inventory Management, Discrete-Event simulation modelling