Supply Chain Management

5 strategies for optimizing inventory and material flow

Process optimization can lead to cost savings, advanced competitiveness and increased profits.

By Richard J. Beaman, Jr., P.E., M.S.Ch.E. and Clifford Reese, P.E., SSOE Group

Whether it’s fragrances, flavors, or pesticides, cutting edge formulations provided by the specialty chemicals industry require intensive knowledge and ongoing innovation to achieve market advantage. Because the engineering focus is primarily on perfecting the chemistry, dedicated engineering assigned to achieving task flow and process efficiencies is often a lesser priority.

Yet, by optimizing the process, specialty chemical manufacturers can improve formulations while they reap substantial savings, advance competitiveness, and increase profit. Five strategies for optimizing inventory and material flow in a specialty chemical process include: analyzing holistically; converting batch processing to continuous processing; simplifying complexities; optimizing energy use; and managing and minimizing waste.

Analyze holistically

The best solutions are developed through an holistic approach to analyzing processes. Insights shared through a team that consists of the facility owner, the internal engineers, and consulting engineers, as well as key operations personnel, all contribute to the success of the solutions.

The holistic approach also requires extensive inventory and material flow analysis, including the specialty chemical manufacturer’s desired production rate and dependency on feedstock delivery timeframes and storage needs. Process optimization for a just-in-time feedstock delivery method versus one that includes on-site intermediate storage to handle inventory unavailability or delivery delays produces two entirely different optimization veins in the work flow diagram.

Processes that are currently “wrong-sized” are sometimes due to design decisions that were made based on bad data or false assumptions. On the other hand, perhaps the facility was initially right-sized, but production requirements evolved over the years and some of the processes have essentially “out-sized” their capacity.

By adjusting a pinch point, the chemical process engineer might be able to eliminate the need for a utility in a process stream, such as increasing the size of a heat exchanger to recover more heat from one stream for use in another.

A thorough analysis of the overall workflow reveals whether and which equipment is properly sized for the desired capacity and which equipment is too large, wasting capital, reducing efficiency and consuming more operating energy. Still, other equipment may be too small, creating a bottleneck and limiting the process. While solutions are many, often the simple ones are overlooked, such as moving an oversized piece of equipment, perhaps a tank or heat exchanger, to a different point in the process.

With an holistic assessment of the workflow, the chemical process engineer focuses on the components of unit operations, including input, output, side streams, waste and bottlenecks. Unit operations translate into energy-exchanging (heating and cooling) and mass-exchanging (component separation) equipment. Then troubleshooting bottlenecks and significant over-capacity improvements can be made.

Reviewing what is in place for planning and scheduling with maintenance and optimization upgrades is also critical to include as part of the solution, as it is obviously unwise to run a piece of equipment or use a component until it breaks. Without a maintenance schedule and documented procedures in place, the potential for operator injury or a chemical release is often imminent. A significant positive impact to profitability occurs when a facility avoids a cycle of frequent, unscheduled shutdowns, repairs, and re-starts.

Convert batch process to continuous process

While some processes are better left as a stand-alone batch, such as those that produce or consume materials not easily transported, significant advantages can be achieved by converting a batch process to a continuous process. While this can be a major undertaking, such a project can be done with both minimal downtime and capital expenditures when it is in experienced hands. The conversion can be well worth the investment, as continuous processing reduces labor costs and reduces process upsets that impact other processes upstream or downstream in the workflow.

For example, reaction batch processing always requires a fill step, one or more reaction steps, and an emptying step. So a continuous reactor process is more efficient because while it uses the same volume of reactor in a continuous process, it generates constant flows of feedstock and product, therefore capacity is increased through the time-equivalent of the fill and emptying step.

Most processes function best at a steady rate, or the result can be upsets that yield off-spec material. If a system is properly controlled, then it may be feasible to redesign the process with a smaller, more efficient intermediate storage tank, or the storage tank may be eliminated. However, without proper controls, the resulting upsets in the steady state will likely require a larger intermediate storage tank to smooth out those upsets downstream. This is especially true of unit operations that are sensitive to load changes, such as distillation.

Simplify complexities

Keeping it simple is one of the most useful yet underutilized strategies in specialty chemical work flows. Continuous processing, rather than batch processing, is one of the most effective strategies for process simplification.

Other opportunities for simplification can be found in the separations area. Consider a chemical reaction process, which typically yields materials to be separated and disposed of, recycled, or recovered for subsequent use. Instead of flushing a cyclone separator after running a slurry through, it might be simpler to let gravity perform the separation in an already existing process tank. Once the solids have settled to the bottom of the tank, the usable liquid can be drawn off the top and fed back into the process using an automated continuous process.

Further opportunities should be considered with equipment that incorporates multiple functions, yet increases complexity. In one case, an incorporated adsorption system had the regeneration heater located inside the adsorber vessel, thereby consuming valuable space inside the vessel and limiting the adsorber’s capacity. The solution to the capacity problem was to use two same-size complex adsorbers. This merely compounded the problem by adding operational and control complexities with balancing flow rates. A simpler solution would have been to replace the two vessels with just one of similar size that did not have the heater inside, maximizing the space for adsorbent. Enabling an adsorber to use its full volume without any interference is a solution that is just that simple.

Optimize energy use with pinch analysis

Facility owners often realize a significant payback for the cost of a pinch analysis; yet this technique is underutilized in the specialty chemical industry. Without optimizing energy exchange, the facility uses more energy. A pinch analysis can be used to take advantage of changing utility costs and find and correct inefficiencies in the heat recovery. By adjusting a pinch point, the chemical process engineer might be able to eliminate the need for a utility in a process stream, such as increasing the size of a heat exchanger to recover more heat from one stream for use in another.

Pinch analysis can track multiple streams of energy available in the processes on a temperature-enthalpy diagram using composite curves. The curves locate the pinch point — that is, the minimum temperature approach between the hotter and colder streams. The analysis also identifies the minimum required utility duties and temperatures required for the process.

For example, a chemical process may employ two distinct levels of refrigeration at different points, with the lower of the two refrigeration temperatures condensing liquid out of a gas stream. The existing process may recover cold energy from the gas with a feed product interchanger; however, a pinch analysis may discover that cool energy from the higher-temperature refrigeration system could be exchanged, reducing energy consumption in the lower-temperature refrigeration system.

Manage waste

Since it’s costly to dispose of high-level process wastes, facility owners often look for savings through recycling it. In some cases, this is an optimal strategy. In other cases, a more cost-effective strategy is to react the waste with another chemical to make it sellable, or to render it inert.

Rick Beaman, P.E., M.S.Ch.E., is senior chemical process engineer and senior associate with SSOE Group, and engineering, procurement, and construction management firm. Email him at rick.beaman@ssoe.com. Cliff Reese, P.E., is business leader and senior associate with SSOE. Email him at cliff.reese@ssoe.com.

Whenever possible, the most cost-effective, optimal strategy for managing waste is to recover and return it to the process, especially when it is an environmental contaminant.

Inert material often comes in with the feedstock. If this isn’t separated out, it is often burned in a flare. But there are materials that can be separated out and reused. For example, a gasification system that makes a synthesis gas and converts it to methanol often contains the inert components nitrogen and argon, along with some unreacted reactants: hydrogen and carbon monoxide that are flared. The addition of a single step can separate these components, recovering most of the hydrogen for reuse in the process. This step can increase plant capacity by 10% through recovering most of the limiting hydrogen reactant from the waste stream.

An experienced process engineer can identify potential improvements in almost any specialty chemical process through an holistic analysis: an examination of the existing process; identification of alternatives; and financial analysis of the implications for unit cost, unit capital and return on investment. Continuous processing and improvements to controls and automation save time, lower labor costs, and increase the yield of on-spec materials. Simplifying complexities by streamlining normally separate tasks can improve equipment sizing and increase production capacity. Energy and waste are two of the most significant contributors to higher unit costs, but pinch analysis and waste recovery/minimization methods can lower unit costs. Optimizing specialty chemical processes is as varied as the processes themselves, but the advantages gained in efficiency, formulation quality, and profitability are what are most important.