Supply Chain Optimization

Client: NYSE Global Refinery & Petrochemical corporation
Category: Proprietary catalysts and additives
Scope: Purchase, delivery and up-load, catalyst removal, catalyst re-generation, unit optimization and equipment maintenance. 10+ plants in the U.S. and Europe, working with global research, engineering, operations and safety
Savings: 35%


Following a benchmarking study conducted by a major strategic consulting firm, our client had decided to re-negotiate with a strategic partner in a very delicate and sensitive relationship. The partner was not only the supplier of highly specialized and expensive catalysts, but also the licensor of the technology, operator of the $100+ million installations, with over 10 FTE on site for operational and maintenance support. Furthermore, the notion of a product switch was perceived as highly risky, with negative impact to production yields and overall revenue.


Reduce Operating Expense (OPEX) by 15% to meet the pre-set savings targets, with no compromise on quality, service levels, operations and safety.


Significant (OPEX) savings of 35% , with no compromise on quality, yield, operation through-put or safety. Developed a pricing model for capturing price volatility of input factors including conversion cost (energy), price sensitivity to precious metals and commodities, and transportation. Additionally, developed a collaborative model for operations, research, engineering, technical support and safety.

Approach (simplified)

  • Created a Governance structure with senior executives and full representation of all key stakeholders including Research, Engineering, Operations, Technical Support, Maintenance, Safety and Environmental teams
  • Developed a customized sourcing and negotiation process with procurement leading the commercial evaluation and negotiations, while other stakeholders led their respective functional areas, and developed and evaluated their respective requirements and specifications
  • Developed an RFI (to qualify new suppliers and develop a product-service matrix), and distribute RFQ and then RFP to evaluate economic, financial and operational feasibilities
  • Scheduled and conducted small-scale “sample” evaluations, and economic and environmental simulations
  • Conducted and managed four rounds of concurrent negotiations: rounds 1 and 2 in the U.S., and concurrently rounds 1 and 2 in Europe. After short-list and sample technical evaluations, round 3 was conducted between two finalists at their HQ office, and round 4 was conducted at our client’s HQ with full participation of global players