This section applies to complex industrial products production where several sites exist or where different ways of production or sale are possible in a particular site.
The purpose is to go far beyond the SAP concept and to optimize the sales and production programmes, mainly through linear programming.
The method is aiming at maximizing the gross margin of a site or a bunch of sites. It calculates and optimizes the gross margin generated for a given period of time by the sale programme when selecting the optimum production method. Furthermore, it suggests sale or production programme modifications when appropriate (i.e. production capacity saturation) and provides in that case the amount of additional earning for the decision making process. Alternatively, the minimization of the cost price can be looked at as a criteria, but the gross margin economical function is richer because it treats both cost and revenues at the same time.
The method is generalized in all the refineries in the world, where products and by- products interact in the production. It is rarely applied in other industrial sectors although its use would bring significant savings.
Before performing the consultancy act of this section, a free quick check of the appropriateness of the method to the industrial case is implemented.