Coupling-Aware Sales and Operations Planning with Forced Co-Production in Polymer Production Plants

Abstract

Profitability metrics, such as the single-product gross profit margin, constitute the standard toolbox to prioritize products in sales and operations planning (S&OP). These metrics leverage the premise that production lines can be committed independently, which endows them with a simple per-ton ranking that a planner can compute and use easily in practice. However, coupled plants, especially polymer plants whose parallel lines draw simultaneously on a single bulk feed, can fundamentally undermine this premise and mislead to value-destroying production plans. We propose a framework built on what we call the Augmented Gross Profit for Product Clusters (AGPPC), which converts the per-ton ranking metric into a per-coupled-hour ranking that carries a per-instance optimality certificate. We present the theory of AGPPC, which combines the co-production column concept with a fluid relaxation of the planning problem, alongside an integrated bilinear mixed integer program of the plant and a McCormick-linearized baseline that provides certified bounds for it, and we demonstrate its effectiveness on real operational data from an Indonesian polymer producer, where the coupling-aware metric alone raises operating profit by 7.6% and the full optimization by 28% over current practice.