Supply Chain

Traditionally supply chain management has meant factories, assembly lines, warehouses, transportation vehicles, and time sheets. Modern supply chain management is a highly complex, multidimensional problem set with virtually endless number of variables for optimization. An Internet enabled supply chain may have just-in-time delivery, precise inventory visibility, and up-to-the-minute distribution-tracking capabilities. Technology advances have enabled supply chains to become strategic weapons that can help avoid disasters, lower costs, and make money. From internal enterprise processes to external business transactions with suppliers, transporters, channels and end-users marks the wide range of challenges researchers have to handle. The aim of this book is at revealing and illustrating this diversity in terms of scientific and theoretical fundamentals, prevailing concepts as well as current practical applications

Real-time optimization of an integrated production-inventory-distribution problem.

In today\u27s competitive business environment, companies face enormous pressure and must continuously search for ways to design new products, manufacture and distribute them in an efficient and effective fashion. After years of focusing on reduction in production and operation costs, companies are beginning to look into distribution activities as the last frontier for cost reduction. In addition, an increasing number of companies, large and small, are focusing their efforts on their core competencies which are critical to survive. This results in a widespread practice in industry that companies outsource one or more than one logistics functions to third party logistics providers. By using such logistics expertise, they can obtain a competitive advantage both in cost and time efficiency, because the third party logistics companies already have the equipment, system and experience and are ready to help to their best efforts. In this dissertation, we developed an integrated optimization model of production, inventory and distribution with the goal to coordinate important and interrelated decisions related to production schedules, inventory policy and truckload allocation. Because outsourcing logistics functions to third party logistics providers is becoming critical for a company to remain competitive in the market place; we also included an important decision of selecting carriers with finite truckload and drivers for both inbound and outbound shipments in the model. The integrated model is solved by modified Benders decomposition which solves the master problem by a genetic algorithm. Computational results on test problems of various sizes are provided to show the effectiveness of the proposed solution methodology. We also apply this proposed algorithm on a real distribution problem faced by a large national manufacturer and distributor. It shows that such a complex distribution network with 22 plants, 7 distribution centers, 8 customer zones, 9 products, 16 inbound and 16 outbound shipment carriers in a 12-month planning period can be redesigned within 33 hours. In recent years, multi-agent simulation has been a preferred approach to solve logistics and distribution problems, since these problems are autonomous, distributive, complex, heterogeneous and decentralized in nature and they require extensive intelligent decision making. Another important part in this dissertation involved a development of an agent-based simulation model to cooperate with the optimal solution given by the optimization model. More specifically, the solution given by the optimization model can be inputted as the initial condition of the agent-based simulation model. The agent-based simulation model can incorporate many other factors to be considered in the real world, but optimization cannot handle these as needed. The agent-based simulation model can also incorporate some dynamics we may encounter in the real operations, and it can react to these dynamics in real time. Various types of entities in the entire distribution system can be modeled as intelligent agents, such as suppliers, carriers and customers. In order to build the simulation model more realistic, a sealed bid multiunit auction with an introduction of three parameters a, ß and y is well designed. With the help of these three parameters, each agent makes a better decision in a simple and fast manner, which is the key to realizing real-time decision making. After building such a multi-agent system with agent-based simulation approach, it supports more flexible and comprehensive modeling capabilities which are difficult to realize in a general optimization model. The simulation model is tested and validated on an industrial-sized problem. Numerical results of the agent-based simulation model suggest that with appropriate setting of three parameters the model can precisely represent the preference and interest of different decision makers

A Disaster Relief Inventory Model Based on Transshipment

This research study is an effort to shed light on how transshipment may help improve the management of inventory in a disaster relief system. System dynamics simulation was used to compare inventory control and costs in a humanitarian supply chain without transshipment vs. one with transshipment. A framework for this approach is given along with the results of simulations on a system consisting of two warehouses where transshipment is allowed compared to the alternative where transshipment is not allowed. The preliminary results of this study indicate that transshipment can reduce costs and improve service to disaster victims based on inventory levels maintained in the warehouses. In some cases, transshipment may be more expensive, but this assumes the cost of replenishing inventory as a result of emergency purchase costs

Simulation and optimization of a multi-agent system on physical internet enabled interconnected urban logistics.

An urban logistics system is composed of multiple agents, e.g., shippers, carriers, and distribution centers, etc., and multi-modal networks. The structure of Physical Internet (PI) transportation network is different from current logistics practices, and simulation can effectively model a series of PI-approach scenarios. In addition to the baseline model, three more scenarios are enacted based on different characteristics: shared trucks, shared hubs, and shared flows with other less-than-truckload shipments passing through the urban area. Five performance measures, i.e., truck distance per container, mean truck time per container, lead time, CO2 emissions, and transport mean fill rate, are included in the proposed procedures using real data in an urban logistics case. The results show that PI enables a significant improvement of urban transportation efficiency and sustainability. Specifically, truck time per container reduces 26 percent from that of the Private Direct scenario. A 42 percent reduction of CO2 emissions is made from the current logistics practice. The fill rate of truckload is increased by almost 33 percent, whereas the relevant longer distance per container and the lead time has been increased by an acceptable range. Next, the dissertation applies an auction mechanism in the PI network. Within the auction-based transportation planning approach, a model is developed to match the requests and the transport services in transport marketplaces and maximize the carriers’ revenue. In such transportation planning under the protocol of PI, it is a critical system design problem for decision makers to understand how various parameters through interactions affect this multi-agent system. This study provides a comprehensive three-layer structure model, i.e. agent-based simulation, auction mechanism, and optimization via simulation. In term of simulation, a multi-agent model simulates a complex PI transportation network in the context of sharing economy. Then, an auction mechanism structure is developed to demonstrate a transport selection scheme. With regard of an optimization via simulation approach and sensitivity analysis, it has been provided with insights on effects of combination of decision variables (i.e. truck number and truck capacity) and parameters settings, where results can be drawn by using a case study in an urban freight transportation network. In the end, conclusions and discussions of the studies have been summarized. Additionally, some relevant areas are required for further elaborate research, e.g., operational research on airport gate assignment problems and the simulation modelling of air cargo transportation networks. Due to the complexity of integration with models, I relegate those for future independent research

Framework for Evaluation of Strategies for Pooling of Repairable Spare Parts

Background: The ability to quickly provide parts for the supply of advanced technical systems in equipment-intensive industries (such as airlines and nuclear power plants) is critical to the systems overall performance. In order to maintain a targeted system availability large quantities of spare parts are often required which in turn results in excessive inventory costs. Seeing as inventory systems often account for a large proportion of a business‟ costs a tough issue faced by companies in these industries is how to reduce the total inventory cost without having a negative impact on the system availability. An approach that may successfully deal with such a problem is pooling. Pooling refers to an arrangement in which multiple owners of the same type of technical systems cooperate by sharing their inventories. Purpose: The theoretical purpose of the thesis is to emphasize different pooling strategies and to identify and assess the characteristics of the strategies. The practical purpose of the thesis is to develop a robust method that facilitates a fair comparison of considered strategies. The objective is thus to develop a generic model that evaluates soft values (here, referred to as soft aspects) for each strategy, and also, to put the soft aspects in relation to the annual cost of a strategy in a final model. iv Methodology: The initial phase of the thesis was dedicated to a desk study review of current literature within the field of study. Recently published scientific articles, papers authored by consultants at Systecon, and literature used in courses at the Faculty of Engineering at Lund University lay the basis for the theoretical framework. The framework developed is derived from discussions with the supervisors in connection with interviews carried out with; relevant Systecon customers and company representatives at two trade fairs, Offshore Wind 2009 and Nordic Rail 2009. Conclusion: This thesis presents a framework for evaluation of strategies (stand alone, ad hoc cooperation, cooperative pooling, and commercial pooling) for pooling of repairable spare parts. Characteristics of all strategies are emphasized and assessed. From the characteristics, which are provided in Table 5.3, a model to evaluate soft values of each strategy is derived. The model, named evaluation of soft values, is provided in Table 5.4 and Table 5.5. Also, a methodical approach to derive a final strategy is provided in section 5.7. To make sure that a decision-maker is well aware of how the model should be applied, a fictitious case study is build up in where every step of the decision making process is thoroughly described. Furthermore, in the case study a final model that facilitates the derivation of a best strategy is presented. By means of a specified weighting coefficient and properly chosen set of scales, the final model provides with a final strategy. The outcome of the final model is based on the outcomes of the cost models and the outcomes of the evaluation of soft values model

Innovation, Research and Development and Capital Evaluation

The role of innovation is becoming increasingly crucial in modern societies. In particular, investments in Research and Development represent an important tool for promoting innovation and for enhancing the capital invested in the market. By now, innovation is linked with different concepts, from entrepreneurship to sustainability, from economics to management. The analysis of the innovation process involves different skills to overcome the high degree of competitiveness and allow higher levels of profits. In the text, the interactions among innovation, entrepreneurship, and ecosystems are investigated. It is an attempt to prepare the theoretical bases to face in an appropriate way the transformations of modern economic and organizational systems and to suggest adequate support policies

Inventory models with lateral transshipments : a review

Lateral transshipments within an inventory system are stock movements between locations of the same echelon. These transshipments can be conducted periodically at predetermined points in time to proactively redistribute stock, or they can be used reactively as a method of meeting demand which cannot be satised from stock on hand. The elements of an inventory system considered, e.g. size, cost structures and service level denition, all in uence the best method of transshipping. Models of many dierent systems have been considered. This paper provides a literature review which categorizes the research to date on lateral transshipments, so that these dierences can be understood and gaps within the literature can be identied