Operations Research in BASF's Supply Chain Operations

In this paper, we highlight the application of operations research (OR) at BASF in the area of supply chain management (SCM) by using selected examples with annual cost savings ranging between several hundred thousand and several million euros. We address special characteristics of the process industry that should be dealt with and identify future research needs. The examples cover strategic, tactical, and operational topics encountered at BASF. We share our lessons learned, based on our experience from past OR projects in SCM, about challenges as well as benefits of standard and tailor-made OR solutions. In general, we find that the special characteristics often call for a modification or enhancement of standard OR models. Providing appropriate solutions therefore requires a joint effort of SCM, IT, and OR experts.