Effective Multi-echelon Inventory Systems for Supplier Selection and Order Allocation

Successful supply chain management requires an effective sourcing strategy to counteract uncertainties in both the suppliers and demands. Therefore, determining a better sourcing policy is critical in most of industries. Supplier selection is an essential task within the sourcing strategy. A well-selected set of suppliers makes a strategic difference to an organization\u27s ability to reduce costs and improve the quality of its end products. To discover the cost structure of selecting a supplier, it is more interesting to further determine appropriate levels of inventory in each echelon for different suppliers. This dissertation focuses on the study of the integrated supplier selection, order allocation and inventory control problems in a multi-echelon supply chain. First, we investigate a non-order-splitting inventory system in supply chain management. In particular, a buyer firm that consists of one warehouse and N identical retailers procures a type of product from a group of potential suppliers, which may have different prices, ordering costs, lead times and have restriction on minimum and maximum total order size, to satisfy stochastic demand. A continuous review system that implements the order quantity, reorder point (Q, R) inventory policy is considered in the proposed model. The model is solved by decomposing the mixed integer nonlinear programming model into two sub-models. Numerical experiments are conducted to evaluate the model and some managerial insights are obtained with sensitivity analysis. In the next place, we extend the study to consider the multi-echelon system with the order-splitting policy. In particular, the warehouse acquisition takes place when the inventory level depletes to a reorder point R, and the order Q is simultaneously split among m selected suppliers. This consideration is important since it could pool lead time risks by splitting replenishment orders among multiple suppliers simultaneously. We develop an exact analysis for the order-splitting model in the multi-echelon system, and formulate the problem in a Mixed Integer Nonlinear Programming (MINLP) model. To demonstrate the solvability and the effectiveness of the model, we conduct several numerical analyses, and further conduct simulation models to verify the correctness of the proposed mathematical model

Architecting Fail-Safe Supply Chains / Networks

Disruptions are large-scale stochastic events that rarely happen but have a major effect on supply networks’ topology. Some examples include: air traffic being suspended due to weather or terrorism, labor unions strike, sanctions imposed or lifted, company mergers, etc. Variations are small-scale stochastic events that frequently happen but only have a trivial effect on the efficiency of flow planning in supply networks. Some examples include: fluctuations in market demands (e.g. demand is always stochastic in competitive markets) and performance of production facilities (e.g. there is not any perfect production system in reality). A fail-safe supply network is one that mitigates the impact of variations and disruptions and provides an acceptable level of service. This is achieved by keeping connectivity in its topology against disruptions (structurally fail-safe) and coordinating the flow through the facilities against variations (operationally fail-safe). In this talk, I will show that to have a structurally fail-safe supply network, its topology should be robust against disruptions by positioning mitigation strategies and be resilient in executing these strategies. Considering “Flexibility” as a risk mitigation strategy, I answer the question “What are the best flexibility levels and flexibility speeds for facilities in structurally fail-safe supply networks?” Also, I will show that to have an operationally fail-safe supply network, its flow dynamics should be reliable against demand- and supply-side variations. In the presence of these variations, I answer the question “What is the most profitable flow dynamics throughout a supply network that is reliable against variations?” The method is verified using data from an engine maker. Findings include: i) there is a tradeoff between robustness and resilience in profit-based supply networks; ii) this tradeoff is more stable in larger supply networks with higher product supply quantities; and iii) supply networks with higher reliability in their flow planning require more flexibilities to be robust. Finally, I will touch upon possible extensions of the work into non-profit relief networks for disaster management

Application of Optimization in Production, Logistics, Inventory, Supply Chain Management and Block Chain

The evolution of industrial development since the 18th century is now experiencing the fourth industrial revolution. The effect of the development has propagated into almost every sector of the industry. From inventory to the circular economy, the effectiveness of technology has been fruitful for industry. The recent trends in research, with new ideas and methodologies, are included in this book. Several new ideas and business strategies are developed in the area of the supply chain management, logistics, optimization, and forecasting for the improvement of the economy of the society and the environment. The proposed technologies and ideas are either novel or help modify several other new ideas. Different real life problems with different dimensions are discussed in the book so that readers may connect with the recent issues in society and industry. The collection of the articles provides a glimpse into the new research trends in technology, business, and the environment

An Integrated Fuzzy Multi-Criteria Decision Making Method For Supplier Evaluation

This research investigates the risk exposure arising from the supplier evaluation criteria of cost, quality, delivery, and flexibility of the supplier. Penyelidikan ini bertujuan untuk mengkaji risiko yang timbul daripada kos, kualiti, penghantaran dan fleksibiliti bagi penilaian pembekal

A contribution to supply chain design under uncertainty

Dans le contexte actuel des chaînes logistiques, des processus d'affaires complexes et des partenaires étendus, plusieurs facteurs peuvent augmenter les chances de perturbations dans les chaînes logistiques, telles que les pertes de clients en raison de l'intensification de la concurrence, la pénurie de l'offre en raison de l'incertitude des approvisionnements, la gestion d'un grand nombre de partenaires, les défaillances et les pannes imprévisibles, etc. Prévoir et répondre aux changements qui touchent les chaînes logistiques exigent parfois de composer avec des incertitudes et des informations incomplètes. Chaque entité de la chaîne doit être choisie de façon efficace afin de réduire autant que possible les facteurs de perturbations. Configurer des chaînes logistiques efficientes peut garantir la continuité des activités de la chaîne en dépit de la présence d'événements perturbateurs. L'objectif principal de cette thèse est la conception de chaînes logistiques qui résistent aux perturbations par le biais de modèles de sélection d'acteurs fiables. Les modèles proposés permettent de réduire la vulnérabilité aux perturbations qui peuvent aV, oir un impact sur la continuité des opérations des entités de la chaîne, soient les fournisseurs, les sites de production et les sites de distribution. Le manuscrit de cette thèse s'articule autour de trois principaux chapitres: 1 - Construction d'un modèle multi-objectifs de sélection d'acteurs fiables pour la conception de chaînes logistiques en mesure de résister aux perturbations. 2 - Examen des différents concepts et des types de risques liés aux chaînes logistiques ainsi qu'une présentation d'une approche pour quantifier le risque. 3 - Développement d'un modèle d'optimisation de la fiabilité afin de réduire la vulnérabilité aux perturbations des chaînes logistiques sous l'incertitude de la sollicitation et de l'offre

Decision support models for supplier development: Systematic literature review and research agenda

The continuing trend towards sourcing components and semi-finished goods for less vertically integrated manufacturing systems globally leads to a dramatic increase in supply options for companies. To ensure that companies benefit from the potentials global sourcing offers, supplier-buyer relationships need to be managed efficiently. Due to the decreasing share of value-adding activities provided in-house, suppliers are more and more considered as an essential contributor to the buying company's competitive position. Consequently, to realize and sustain competitive advantages, companies try to establish institutionalized long-term relationships to their most important suppliers and to actively improve the productivity and performance of their supplier base. To support supplier development in practice, researchers have developed decision support models that provide assistance in selecting and implementing suitable supplier development activities. The aim of this paper is to provide a comprehensive and systematic overview of decision support models for supplier development and to develop a research agenda that helps to identify promising areas for future research in this area. First, typical applications for supplier development as well as potential development measures that can be adopted to improve the performance of suppliers are identified. Secondly, a systematic literature review with a focus on decision support models for supplier development is conducted. Based on the analysis of the literature, we define a research agenda that synthesizes key trends and promising research opportunities and thus highlight areas where more decision support models are needed to foster supplier development initiatives in practice

Reprint of "Decision support models for supplier development: Systematic literature review and research agenda"

The continuing trend towards sourcing components and semi-finished goods for less vertically integrated manufacturing systems globally leads to a dramatic increase in supply options for companies. To ensure that companies benefit from the potentials global sourcing offers, supplier-buyer relationships need to be managed efficiently. Due to the decreasing share of value-adding activities provided in-house, suppliers are more and more considered as an essential contributor to the buying company's competitive position. Consequently, to realize and sustain competitive advantages, companies try to establish institutionalized long-term relationships to their most important suppliers and to actively improve the productivity and performance of their supplier base. To support supplier development in practice, researchers have developed decision support models that provide assistance in selecting and implementing suitable supplier development activities. The aim of this paper is to provide a comprehensive and systematic overview of decision support models for supplier development and to develop a research agenda that helps to identify promising areas for future research in this area. First, typical applications for supplier development as well as potential development measures that can be adopted to improve the performance of suppliers are identified. Secondly, a systematic literature review with a focus on decision support models for supplier development is conducted. Based on the analysis of the literature, we define a research agenda that synthesizes key trends and promising research opportunities and thus highlight areas where more decision support models are needed to foster supplier development initiatives in practice

A Computer-Based Simulation Investigation of Environment-Strategy Fit for Risk Management in Global Supply Chains

The purpose of this dissertation is to examine the phenomenon of risk management in global supply chains. Drawing from logistics, supply chain management, operations management, economics, international business, and strategy literatures and a qualitative study, a comprehensive conceptual model of environment-strategy fit for risk management in global supply chains was developed. External environmental conditions comprising of supply and demand risks, four risk management strategies, namely hedging, assuming, postponement, and speculation, and a moderator in the form of a port disruption were chosen for further investigation. The model was quantitatively tested using a simulation. The findings from this dissertation study reflect mixed results. Findings that conform to existing research, primarily related to hedging and speculation strategies, provide empirical support for extant knowledge that is primarily conceptual or experience-based. On the other hand, findings that are contrary to existing knowledge or are supported under very select conditions, primarily related to assuming and postponement strategies, provide interesting new insights into the phenomenon. The findings add to both theoretical and practical understanding of the phenomenon. This research opens up several new research directions that indicate that continued research is needed to facilitate both theoretical and empirical progress in better understanding of risk management in global supply chains

Integrated management of chemical processes in a competitive environment

El objetivo general de esta Tesis es mejorar el proceso de la toma de decisiones en la gestión de cadenas de suministro, tomando en cuenta principalmente dos diferencias: ser competitivo considerando las decisiones propias de la cadena de suministro, y ser competitivo dentro de un entorno global. La estructura de ésta tesis se divide en 4 partes principales: La Parte I consiste en una introducción general de los temas cubiertos en esta Tesis (Capítulo 1). Una revisión de la literatura, que nos permite identificar las problemáticas asociadas al proceso de toma de decisiones (Capítulo 2). El Capítulo 3 presenta una introducción de las técnicas y métodos de optimización utilizados para resolver los problemas propuestos en esta Tesis. La Parte II se enfoca en la integración de los niveles de decisión, buscando mejorar la toma de decisiones de la propia cadena de suministro. El Capítulo 4 presenta una formulación matemática que integra las decisiones de síntesis de procesos y las decisiones operacionales. Además, este capítulo presenta un modelo integrado para la toma de decisiones operacionales incluyendo las características del control de procesos. El Capítulo 5 muestra la integración de las decisiones del nivel táctico y el operacional, dicha propuesta está basada en el conocimiento adquirido capturando la información relacionada al nivel operacional. Una vez obtenida esta información se incluye en la toma de decisiones a nivel táctico. Finalmente en el capítulo 6 se desarrolla un modelo simplificado para integrar múltiples cadenas de suministro. El modelo propuesto incluye la información detallada de las entidades presentes en una cadena de suministro (suministradores, plantas de producción, distribuidores y mercados) introduciéndola en un modelo matemático para su coordinación. La Parte III propone la integración explicita de múltiples cadenas de suministro que tienen que enfrentar numerosas situaciones propias de un mercado global. Asimismo, esta parte presenta una nueva herramienta de optimización basada en el uso integrado de métodos de programación matemática y conceptos relacionados a la Teoría de Juegos. En el Capítulo 7 analiza múltiples cadenas de suministro que cooperan o compiten por la demanda global del mercado. El Capítulo 8 incluye una comparación entre el problema resuelto en el Capítulo anterior y un modelo estocástico, los resultados obtenidos nos permiten situar el comportamiento de los competidores como fuente exógena de la incertidumbre típicamente asociada la demanda del mercado. Además, los resultados de ambos Capítulos muestran una mejora sustancial en el coste total de las cadenas de suministro asociada al hecho de cooperar para atender de forma conjunta la demanda disponible. Es por esto, que el Capítulo 9 presenta una nueva herramienta de negociación, basada en la resolución del mismo problema (Capítulo 7) bajo un análisis multiobjetivo. Finalmente, la parte IV presenta las conclusiones finales y una descripción general del trabajo futuro.This Thesis aims to enhance the decision making process in the SCM, remarking the difference between optimizing the SC to be competitive by its own, and to be competitive in a global market in cooperative and competitive environments. The structure of this work has been divided in four main parts: Part I: consists in a general introduction of the main topics covered in this manuscript (Chapter I); a review of the State of the Art that allows us to identify new open issues in the PSE (Chapter 2). Finally, Chapter 3 introduces the main optimization techniques and methods used in this contribution. Part II focuses on the integration of decision making levels in order to improve the decision making of a single SC: Chapter 4 presents a novel formulation to integrate synthesis and scheduling decision making models, additionally, this chapter also shows an integrated operational and control decision making model for distributed generations systems (EGS). Chapter 5 shows the integration of tactical and operational decision making levels. In this chapter a knowledge based approach has been developed capturing the information related to the operational decision making level. Then, this information has been included in the tactical decision making model. In Chapter 6 a simplified approach for integrated SCs is developed, the detailed information of the typical production‐distribution SC echelons has been introduced in a coordinated SC model. Part III proposes the explicit integration of several SC’s decision making in order to face several real market situations. As well, a novel formulation is developed using an MILP model and Game Theory (GT) as a decision making tool. Chapter 7 includes the tactical and operational analysis of several SC’s cooperating or competing for the global market demand. Moreover, Chapter 8 includes a comparison, based on the previous results (MILP‐GT optimization tool) and a two stage stochastic optimization model. Results from both Chapters show how cooperating for the global demand represent an improvement of the overall total cost. Consequently, Chapter 9 presents a bargaining tool obtained by the Multiobjective (MO) resolution of the model presented in Chapter 7. Finally, final conclusions and further work have been provided in Part IV.Postprint (published version

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