Considering economic-environmental dimension in the integrated strategic and tactical optimization of Ethiopia's bioethanol supply chain coupled with operational planning

Abstract

The global supply chain has garnered significant attention in recent years due to its intricate nature and operational challenges. Companies face the crucial task of integrating various components to maintain competitiveness and enhance overall performance across the supply chain. Achieving this goal necessitates vertical integration to ensure coherence and coordination among decision-making processes at different temporal and spatial scales, bridging the gap between strategic, tactical, and operational decisions. This article proposes a mathematical model that integrates the three previous decisions within the supply chain context, aiming to maintain coherence while considering economic and environmental objectives (few papers cover this challenge). By addressing the complexities of multi-scale modeling and optimization, the model seeks to provide a holistic view of supply chain operations. The model focuses on the transport decisions at the operational level, resulting in the coupling between a strategic and tactical model and a vehicle routing problem. Nonetheless, achieving this integration effectively from a modeling and resolution point of view leads to computational and methodological challenges due to the multi-scale, multi-site, and multi-objective nature of the problem, requiring an innovative approach for effective model resolution. The contributions of this article pave the way towards more sustainable and efficient supply chain operations. The model capabilities are exemplified through the real case study of the bioethanol supply chain in Ethiopia. For the location of the different firms of the supply chain, the country is divided into 58 zones (second level administrative subdivision in Ethiopia) to have a precise mapping of the area. The result of the case study shows that in adding the operational level decisions to the strategic-tactical ones has not only changed the topology of the network configurations but has greatly affected the economic and environmental criteria due to more precise estimation of all activities. The results put also in highlight that there is a compromise to find between both previous objectives by identifying Pareto alternative scenarios.