Supply Chain Design
Insights in the resilience and sustainability of your supply chain”
Globalisation has made supply chains more complex and thus more vulnerable to disruptions. A disruption in one part of the world could mean that customer’s demand at the other side of the world cannot be served any more, as we have seen with the lockdowns due to the COVID pandemic, the blockage of the Suez Canal by the Ever Given, and the war in Ukraine. Hence, for a supply chain company it is crucial to know how resilient their supply chain is to unforeseen events.
A second challenge that many companies face is the need to decarbonise their operations. To reach the Paris Agreement’s goal to stay below 1.5 degrees Celsius of global warming, emissions need to be reduced by 50% by 2030. One option towards reaching this goal is to electrify the transportation process in the supply chain. Buying a new fleet is a capital-intensive decision that comes with a long-time horizon in which a lot is uncertain. Another possibility to reduce emissions is to change the current operations, for instance by opening an extra warehouse facility to reduce the driven kilometres, or by a modal shift to more energy efficient modalities. It is important to know what the most cost-effective way is to reduce emissions as much as possible, and to explicitly highlight the trade-off between costs and emission reductions.
Finding the best answer in different scenarios
The models of Doing The Math have the power to evaluate many options in just the blink of an eye. We often develop custom models, not just general purpose ones. With the models that we develop, you can evaluate many options quickly.
Another feature of our models is that they can help you reach the best decisions under many different scenarios. This is extremely useful when investigating the environmental aspect of your supply chain. Even slight changes in the supply chain can make them more sustainable. Our approach can help you determine which changes best serve your goals in many possible future scenarios.
Preparing your utility network for tomorrow”
Cooperating in a decentralised system
Consumption of fossil fuels is being replaced with renewable sources of energy. This poses challenges to utility companies, such as the challenge to manage the intermittency associated with these new energy sources. Countermeasures like energy storage, load and generation control are complex and impact both short-term decision making (such as control problems), and long-term decision making (such as grid expansion planning). Another challenge is that the supply of the remaining fossil fuels is becoming more and more uncertain, resulting in extremely volatile prices.
Decentralisation of energy generation forces a shift away from the traditional utility business model in which monopolistic power companies generate and distribute their energy from large power plants to the end user. Today, EU regulation separates trade from transmission. We are moving to a situation in which a few large and many small energy producers and network operators need to cooperate in a decentralised system. Specific and complicated measures must be taken by the network operators to always match energy production and consumption, while managing distribution and grid stability.
Digitisation allows for the use of advanced analytical methods
Critical to the management of a network is the digitisation of the network. This will allow for the use of advanced analytical methods to support decision making, and managing an increasingly complex system. With Doing The Math’s mathematical optimisation technology, gas, water and electricity networks can address their complex business challenges. For example, our models can help you with strategic decisions, such as how to expand the current network, and operational decisions, such as how to best serve clients in a situation of short-term shortage of supply. Depending on your situation, we can incorporate many different objectives for these decisions. One could for instance think of maximising the utilisation of resources, reducing operational risks, and improving regulatory compliance or any combination of objectives.
Use Doing The Math’s models to balance costs and security of supply”
With big investing power comes big responsibility”
Pension funds need to do more than deliver good pensions
Pension funds are of course responsible for delivering a good pension to their participants, and that’s where their focus has traditionally been. In recent years, however, the idea has gained momentum that achieving a good return on investment isn’t all there is.
Pension funds administer large sums of capital on behalf of their participants. Being large investors, they can fulfil a critical role in steering societal developments, such as the energy transition. Increasingly, pension funds feel a responsibility to contribute to a sustainable world, that provides a good life to their participants.
We can help develop models that integrate non-financial information”
With big investing power comes big responsibility. Pension funds cannot afford to blindly trust criteria such as ESG. A recent report of the IPCC, the UN scientific climate panel, concludes that ESG barely has any effect on the way the financial sector tackles climate change.
Generally speaking, investors are still at the beginning of the journey towards a low-CO2 economy and society. Transferring money streams towards truly effective investments appears to be a complex challenge.
Integrate non-financial data in realistic scenarios
To bring about real change and retain a healthy return at the same time, pension funds will need to adopt a radically different approach. What they need is a method to record the sustainability aspects of investments objectively and coherently, based on realistic scenarios and data analysis. Doing The Math can help develop models that integrate such non-financial information. We can also help to develop an investment strategy that is tested and well-founded, and takes into account the ecosystems in which corporations exist.
Any long-term strategy needs to be substantiated with reliable data”
From compliance to strategy
The drive towards more sustainability has been embedded in a long line of laws and regulations. That will continue to be the case for the time being. Most organisations see it as their main challenge to comply with current laws, especially since they don’t always create a level playing field.
Other organisations have realised that merely being compliant is too passive a stance. No matter how you look at it, sustainability will have to be part of every durable business model. We can no longer ignore that fact. That’s why progressive companies no longer wait for the government to tell them what’s expected of them. They understand that sustainability is not a matter of compliance; it’s a business issue.
Merely being compliant is too passive a stance”
These organisations take the initiative to highlight sustainability in their strategy, and look for a fitting business model. They’re mainly focused on the opportunities that a move towards sustainability brings.
Of course, a sustainable business model also needs to be financially sound. Discovering and evaluating new options that satisfy both conditions is one of the hardest challenges moving forward.
Creating impact with reliable data
Developing and elaborating such a strategy is all about achieving practical impact. That cannot be done based on intuitions or grand ideals alone. Any long-term strategy needs to be substantiated with reliable data and realistic scenarios.
Doing The Math can help to establish and maintain strategic policies. For instance:
- Setting sustainability targets (what do we want to accomplish, and when do we want to get there?)
- Mapping out the preconditions
- Researching the different roads available (what will work, and what won’t?)
- Investigating the coherence between various factors (such as in the logistical chain, or in partnerships)