Supply Chain Optimisation in the Paper Industry

We describe the formulation and development of a supply-chain optimisation model for Fletcher Challenge Paper Australasia (FCPA). This model, known as Paper Industry Value Optimisation Tool (PIVOT), is a large mixed integer program that finds an optimal allocation of supplier to mill, product to paper machine, and paper machine to customer, while at the same time modelling many of the supply chain details and nuances which are peculiar to FCPA. PIVOT has assisted FCPA in solving a number of strategic and tactical decision problems, and provided significant economic benefits for the company.