Using simulation to explore the influence of online reviews on supply chain dynamics

This paper extends existing research on the dynamic behaviour of supply chains by including the influence of online reviews. We model an online supply chain which contains customers and one e-commerce retailer. By using simulation, we compare the dynamic performance in a supply chain for two scenarios, namely adopting online review systems and without adopting the systems. The supply chain dynamic performance is measured by bullwhip effect and inventory variance amplification. The results demonstrate that online review systems increase both the bullwhip effect and inventory variance amplification, and this impact can be moderated by product quality, unit mismatch cost, lead time, and customer volatility. We further explore how our model could be extended to include market competition, dual sourcing, online review manipulation, and product returns. As the increase in the bullwhip effect and inventory variance amplification can be associated with supply chain inefficiency, managers who are aware of such consequence induced by online review adoption can make better decisions in supply chain management

Dynamic mutual adjustment search for supply chain operations planning coordination

RÉSUMÉ Les chaînes d’approvisionnement sont des systèmes complexes comprenant plusieurs organisations indépendantes avec des objectifs différents dans un environnement incertain et dynamique. Une question clé dans la gestion de chaîne d’approvisionnement (Supply Chain Management) est la coordination des décisions de planification des opérations. Les systèmes de planification de chaîne d’approvisionnement introduits dans la littérature peuvent être classés en deux systèmes de planification principaux: les systèmes de planification centralisés et les systèmes de planification décentralisés. Les systèmes centralisés peuvent théoriquement optimiser les performances de la chaîne d’approvisionnement bien que leur mise en œuvre nécessite un haut degré d’échange d’informations entre les partenaires de la chaîne d’approvisionnement. Cela conduit à des difficultés lorsque des partenaires indépendants ne veulent pas partager l’information. Afin de répondre à ces difficultés, les systèmes décentralisés de planification des opérations sont conçus dans lesquels chaque membre est une entité économique distincte qui prend ses décisions opérationnelles de manière indépendante, mais avec un niveau minimal d’échange d’information. Dans cette thèse, nous étudions dans un premier temps les méthodes de coordination des processus de planification des opérations dans les chaînes d’approvisionnement proposées dans la littérature. Ensuite, nous proposons un cadre de classification de ces méthodes basée sur la technologie mise en œuvre, et identifions des opportunités de recherches. Dans un deuxième temps, nous proposons une approche de coordination décentralisée qui consiste en un ajustement mutuel des décisions de planification basé sur la programmation mathématique et l’échange d’incitatifs financiers. Ce mécanisme, contrairement à un système centralisé traditionnel, implique deux entreprises, qui interagissent l’une avec l’autre afin d’améliorer leur performance. Dans le cadre de cette approche, seul un petit sous ensemble des solutions de coordination sont considérées, et l’expérimentation montre que cette approche de coordination a un potentiel d’amélioration du profit global tout en préservant l’équité en termes de partage des bénéfices de l’amélioration. Enfin, afin de proposer une méthode de coordination capable d’être utilisable dans le contexte dynamique des chaînes d’approvisionnement, cette thèse propose dans un premier temps une stratégie performante de négociation du fournisseur adaptée à l’approche de coordination proposée, ainsi qu’une stratégie de partage des revenus appliquée à un contexte d’horizon roulant. L’analyse de la performance de cette méthode particulière montre également que l’approche proposée produit une stratégie gagnante-gagnante pour les deux partenaires de la chaîne d’approvisionnement et améliore les résultats de planification.----------ABSTRACT Supply chains are complex systems, which include several independent organizations with different objectives, in dynamic uncertain environment. A key issue in supply chain management (SCM) is the coordination of supply chain operations planning decisions. Supply chain planning systems introduced in the literature can be classified into two main planning systems: centralized and decentralized planning systems. Centralized systems can theoretically optimize supply chain performance although its implementation requires a high degree of information exchange among supply chain partners. This leads to difficulties when independent partners do not want to share information. In order to address these difficulties, decentralized systems are designed for supply chains where each member is a separate economic entity that makes its operational decisions independently, yet with some minimal level of information sharing. In this thesis, we first review supply chain operations planning coordination methods from centralized to decentralized approaches proposed in the literature. Next, we propose a classification scheme of these approaches based on the technology used by the authors. Finally, we identify research opportunities. Second, we propose a decentralized operations planning coordination mechanism referred to as mutual adjustment search (MAS), which is based on a negotiation-like mutual adjustment of planning decisions with financial incentives and rooted in mathematical programming. This mechanism, unlike traditional centralized system, involves two independent enterprises linked by material and non-strategic information flows, which interact with each other in order to coordinate their operations planning, and to improve their individual and collective performance. In this approach, only a few coordination solutions (pairs of coordinated operations plans) are considered and computational analysis shows that this coordination mechanism has the potential to improve global profit, while maintaining fairness in terms of revenue sharing. Finally, in order to develop an approach capable of supporting the dynamic coordination of operations planning in a rolling horizon context, this thesis first proposes a negotiation strategy for the supplier, as well as a revenue sharing protocol. Computational analysis shows that the proposed approach produces a win-win strategy for two partners of supply chain and improves the results of upstream planning

Inventory management in the electricity industry in South Africa : a case study.

Master of Commerce in Management. University of KwaZulu-Natal, Pietermaritzburg 2017.Electricity remains one of the most important technological innovations in human history, because of its importance to modern daily life, both domestically and industrially. In South Africa, Eskom Holdings is the state-owned power company responsible for generating, transmitting and distributing electricity. Eskom’s material management department deals with the planning and ordering of materials and their transportation to the regional distribution centres (warehouses). This department is expected to contribute to the company’s business goal of providing sustainable electricity for a better future. However, inept decision-making processes at Eskom have led to a number of problems associated with inventory. These costly problems diminish the material management department’s efficiency and hence the company's ability to reach its goals. This study used qualitative research to investigate the inventory management in Eskom’s KwaZulu-Natal (KZN) cluster with a view to identifying those decisions and actions responsible for such inventory anomalies. A conceptual model of inventory management was used to structure this research. This model emphasises the way in which managers’ decisions are influenced by the context in which the supply chain operates. The research objectives were to examine the impact of demand, the supply chain structure, information availability and Eskom's business goals on how inventory decisions are made, and to understand the effects of this decision making processes. The major finding was that the department has a significant problem of unbalanced stock, with an excess of certain items and shortages of others in all its six regional distribution centres in KZN. This inventory challenge facing the company was found to be caused by inadequate forecasting, poor information sharing, poor housekeeping, large quantities of inventory returns from projects and the disorganised scheduling of deliveries. The study also found that there is a gap in the system of classification of inventory in Eskom which adversely affects the management of inventory. Recommendations include replacing the economic order quantity system with a periodic order quantity system and incorporating elements of lean into the management of inventory. Furthermore, improving the information available to material requirement planners so that purchasing is responsive to customer demands will reduce the burden of inventory that is not required and ensure the availability of stock as it is needed

Analyzing Vertical Mergers: Accounting for the Unilateral Effects Tradeoff and Thinking Holistically About Efficiencies

With the adoption of the 2020 Vertical Merger Guidelines, the U.S. antitrust agencies have updated their guidance on vertical mergers for the Twenty-First Century. Although economists have long recognized the procompetitive benefits most vertical mergers generate, the law has not always followed suit, and has sometimes condemned vertical mergers for making the merged firm more efficient. In this article, we attempt to catalogue the extensive list of efficiencies that vertical mergers can generate, trace the often halting efforts to incorporate these insights into the law, and propose a framework that courts and agencies can use to assess the likely competitive effects of vertical transactions. We draw heavily upon leading cases, particularly Baker Hughes and AT&T, with two refinements. First, consistent with the final Guidelines (but not the earlier draft) and the economic literature noting a symmetry between unilateral anticompetitive effects (raising rivals’ costs) and procompetitive effects (the elimination of double marginalization), which we call the “unilateral effects tradeoff,” we argue a plaintiff alleging a raising rivals cost (RRC) theory of harm must also address EDM as part of its prima facie case. Second, if the plaintiff carries its prima facie burden, then the defendant should be able to argue, and courts and Agencies should seriously consider, the full range of procompetitive efficiencies, which we call a “holistic efficiency analysis.

System dynamics modelling, analysis and design of assemble-to-order supply chains

Background and purpose: The assemble-to-order supply chains (ATO) is commonly-adopted in personal computer (PC) and semiconductor industries. However, the system dynamics of PC and semiconductor ATO systems, one of the main sources of disruption, is not well-explored. Thereby this thesis aims to 1) develop a nonlinear system dynamics model to represent the real-world PC and semiconductor ATO systems, 2) explore the underlying mechanisms of ATO system dynamics in the nonlinear environment and 3) assess the delivery lead times dynamics, along with bullwhip and inventory variance. Design/methods: Regarding the semiconductor industry, the Intel nonlinear ATO system dynamics model, is used as a base framework to study the underlying causes of system dynamics. The well-established Inventory and Order based Production Control System archetypes, or the IOBPCS family, are used as the benchmark models. Also, the IOBPCS family is used to develop the PC ATO system dynamics model. Control engineering theory, including linear (time and frequency response techniques) and nonlinear control (describing function, small perturbation theory) approaches, are exploited in the dynamic analysis. Furthermore, system dynamics simulation is undertaken for cross-checking results and experimentation. Findings: The ATO system can be modelled as a pull (order driven) and a push (forecasting driven) systems connected by the customer order decoupling point (CODP). A framework for dynamic performance assessment termed as the ‘performance triangle’, including customer order delivery lead times, CODP inventory and bullwhip (capacity variance), is developed. The dynamic analysis shows that, depending on the availability of CODP Abstract iii inventory, the hybrid ATO system state can be switched to the pure push state, creating poor delivery lead times dynamics and stock-out issues. Limitations: This study is limited to the analysis of a closely-coupled two-echelon ATO systems in PC and semiconductor industries. Also, the optimization of control policies is not considered. Practical implications: Maintaining a truly ATO system state is important for both customer service level and low supply chain dynamics cost, although the trade-off control design between CODP inventory and capacity variance should be considered. Demand characteristics, including variance and mean, play an important role in triggering the nonlinearities present in the ATO system, leading to significant change in the average level of inventory and the overall transient performance. Originality / value: This study developed system dynamics models of the ATO system and explored its dynamic performance within the context of PC and semiconductor industries. The main nonlinearities present in the ATO system, including capacity, non-negative order and CODP inventory constraints, are investigated. Furthermore, a methodological contribution has been provided, including the simplification of the high-order nonlinear model and the linearization of nonlinearities present in the ATO system, enhancing the understanding of the system dynamics and actual transient responses. The ‘performance triangle’ analysis is also a significant contribution as past analytical studies have neglected customer order lead time variance as an inclusive metric