Specialty Chemicals Production Networks

Design Principles of Specialty Chemicals Production Networks 

13 Microreaction technology is described in detail in Ehrfeld et al. (2000). Wille et al. (2004) describe an application in specialty chemicals. 

Share of global value chain capacity located at site 

Share of site fixed costs absorbed by value chain 

Since the primary role of sites in specialty chemicals production networks is to provide infrastructure services for the different plants they host, the design principle underlying specialty chemicals production networks has to be analyzed from the value chain perspective. Both market area plant and product plant segmentations can be found (cf. Schmenner 1982a, p. 13). Often, in case of relatively small production volumes, each plant produces a segment of the value chain s product portfolio for global 

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Specialty chemicals production networks can be looked at from two different perspectives the site perspective and the value chain perspective. As discussed in Chapter 2.3.2 a specialty chemicals production site usually hosts several plants that may each belong to a different value chain. At the same time a value chain s plants are typically spread across several sites located in different economic regions. As a result one obtains a matrix structure such as the conceptual matrix shown in Figure 10. For each value chain the grey triangles show the importance of the different sites for the... 

A Real-World Specialty Chemicals Production Network... 

Today s specialty chemicals industry consists of several companies with global operations and countless regional/niche competitors. To illustrate the complexity of specialty chemicals production networks, the network operated by American company Rohm and Haas is presented here. It is chosen because of the public availability of data14 but is representative of other specialty chemicals companies networks. 

For specialty chemicals production networks, the planning and controlling process has to combine the site perspective and the value chain perspective. Most specialty chemicals companies have a division/business unit organization and operate sites shared by several divisions. While each division can cover the value chain perspective individually, for example by integrating the above-mentioned indicators into controlling processes, the site perspective requires cross-divisional coordination to avoid suboptimal solutions. Different options ranging from centralized to decentralized setups exist to do so (cf. Hayes and Wheelwright 1984, pp. 120-125). 

Based on a comparison of alternative proposals from literature, in this chapter modeling approaches are developed that cover the specific requirements of specialty chemicals production networks. The focus is not so much on mathematical aspects but on applicability to problems from industry. 

Vol. 594 R. Hiibner, Strategic Supply Chain Management in Process Industries An Application to Specialty Chemicals Production Network Design. XII, 243 pages, 2007... 

An Application to Specialty Chemicals Production Network Design... 

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