Creating value in the supply chain using the Fast model (case study: Persian Gulf Star Gas Condensate Refinery)

Dissertation to receive the master degree "MA"

Industrial Engineering

Treatment: Industries – Industries

Winter 2013

Abstract

Nowadays, paying attention to the issue of supply chain and its management is of great importance in the global era, and most of the companies, due to the heavy competition between them, found that their purchasing department can have an effective effect on the efficiency and increase the efficiency of their company. Although many methods have been proposed in the field of supply chain productivity, none of them have led to the creation of value in the supply chain, and many projects have not achieved the predetermined value after the end, so companies should create value in the supply chain in order to achieve appropriate productivity in their supply chain; Therefore, one of the most recent and most important of these methods is the use of the FAST technique, or functional analysis, which is introduced as the heart of value engineering, because this method can cover the gap in other methods and lead to the creation of value; Therefore, to prove this, we have conducted an applied research and a case study in the field of the Persian Gulf Star Gas Condensate Refinery construction project, and in examining this refinery, we will see that by eliminating non-value-creating functions and prioritizing the supply chain through the FAST chart, value creation in the supply chain can be achieved by reducing costs and construction time.

Keywords: supply chain, value creation, FAST technique, Star Gulf Gas Condensate Refinery Fars

Chapter 1

General research

Introduction:

In today's global competition, various products should be made available according to the customer's request. The customer's demand for high quality and fast service has increased the pressures in the supply chain that did not exist before, as a result, companies can no longer handle all the work alone. In the existing competitive market, economic and production enterprises, in addition to dealing with the organization and internal resources, have found themselves in need of managing and monitoring related resources and elements outside the organization. The reason for this is actually to achieve a competitive advantage or advantages with the aim of gaining more market share. Based on this, activities such as supply and demand planning, material procurement, product production and planning, product storage service, inventory control, distribution, delivery and customer service, which were previously done at the company level, have been transferred to the supply chain level. The key issue in a supply chain is proper management and control of all these activities. Supply chain management (SCM[1]) is a phenomenon that does this in a way that allows customers to receive reliable and fast service with quality products at minimum cost. In general, a supply chain consists of two or more organizations that are formally separated from each other and by The flows of materials, information and financial flows are related to each other. These organizations can be companies that produce raw materials, components, final products or services such as distribution, storage, wholesale and retail. Even the final consumer can be considered one of these organizations. To achieve the goals of the supply chain, organizations and companies must create value in their supply chain; Because value from the customer's point of view has broad concepts that may be different for each product. One of the ways to create value that is common to almost all products and services is to reduce the consumer price. In this project, the goal is to identify the ways to create value for the customer and then to express the value creation solutions, especially cost reduction in the supply chain.

This research chapter is an overview of the general research. In this chapter, at the beginning, the issue has been examined in detail and the need to deal with this issue has been described, and then the necessity of conducting research and the objectives and questions of the research have been mentioned, and at the end, things such as the scope of the research and the definitions of variables have been mentioned. Also, wherever it is needed, the experiences of different companies and the reasons for their success have been examined.

1-1-  Statement of the problem

Nowadays, companies have realized that their purchasing department can be increasingly effective in increasing their efficiency and effectiveness, and for this reason, they have changed their purchasing methods and tried to find the right purchasing method for their goods, so that the purchasing department can fulfill the company's strategic purchase objectives as a part of the company. It is provided. The supply chain includes the organizations and processes that create and deliver goods, information, and services to consumers. Purchasing, funds flow, material transportation, production planning and control, inventory and logistics control, and distribution and delivery will also be included in this chain. In other words, supply chain management is the management of all the activities required to provide a product to the final customer (supply chain).

In the supply chain, information management will be effective in various sectors, some of which are (Zanjirani, 2012):

Logistics management

Data exchange and processing between partners

Collection and processing Information to analyze the process of sourcing and evaluation, selection and development of suppliers

Collection and processing of supply and demand information and . To predict the market trend and the future conditions of supply and demand

Creating and improving relationships between partners (Ebrahimi et al., 2018)

Given the current situation where there is heavy competition between producers, the lack of coordination between the activities of business partners is known as another issue that makes supply chain management difficult. These types of problems occur when a department of the organization does not have a good relationship with other departments, or when prioritization is not done in the implementation of the supply chain to improve it. Therefore, the lack of proper use and the lack of integration of techniques in the supply chain of companies causes the supply chain to not see productivity and valuable application, and it is not possible to have a comprehensive management on the supply chain. So far, different models have been presented to solve the problem of supply chain management and value creation, which are described under a comprehensive classification of these models. It is:

Mathematical programming-based methods (Zanjirani, 2013)

Decision analysis methods, such as multi-criteria decision making (AHP-ANP-TOPSIS) (Laia Alfat and Hekaran, 2013)

Using value engineering and fuzzy theory (Bayat, 2014)

Optimization techniques

But considering the use of methods So far, valuable productivity has not been observed regarding value creation in the supply chain. Value engineering is based on value analysis and is a process during which the design team trained in value analysis tries to apply it to the new product. The value engineering process consists of five phases. (IRS, 1383)

1- Initial phase of preparation[2]

2- Information phase[3]

3-Creativity phase[4]

4-Evaluation phase[5]

5-Implementation phase[6]

By using each of these phases, FAST technique can open the way compared to other used methods. Because some efforts and spending of resources do not lead to meeting the real needs of customers, and this means that when the product or service is provided to the customer, it does not match his needs.

Considering that a successful manufacturer is the one who provides products or services according to the needs of customers, with the right quality and cost. Value engineering can provide this success through understanding the needs and demands of customers. It can be said that the value is the lowest cost for performing the necessary functions or services at the desired time and place with the appropriate quality and reliability. The price-to-cost ratio is defined as a value index (Biraqi, 2019). Therefore, in order to achieve the goal of value creation in the supply chain, organizations and companies must prepare the FAST model (technique) in their supply chain. The analysis and operation of the FAST diagram is defined as the heart of value engineering, and its complete performance will play a decisive role in identifying fields of creativity and analyzing the costs caused by changes in the application of a new idea. had