The Expectation-Based Loss-Averse Newsvendor

We modify the classic single-period inventory management problem by assuming that the newsvendor is expectation-based loss averse according to Koszegi and Rabin (2006, 2007). Expectation-based loss aversion leads to an endogenous psychological cost of leftovers as well as stockouts. If there are no monetary stockout costs, then the loss-averse newsvendor orders a quantity lower than the quantity ordered by a profit-maximizing newsvendor. If there are positive monetary costs associated with stockouts, then the loss-averse newsvendor places suboptimal orders, which can be either too high or too low

Optimal allocation of blood products

The high cost of collection and the short shelf life of apheresis platelets demand efficient inventory management to reduce outdates and shortages. Apheresis platelets are licensed for seven days, and blood centers are keen on knowing the consequences of various product collection and distribution strategies. To reduce outdates, inventory managers typically distribute the older units first, thereby following first-in first-out (FIFO) policy; however, hospital blood banks would prefer that the blood center issues out the freshest units first, equivalent to a last-in first-out (LIFO) policy. This study addresses the optimal distribution policy to achieve a desired outdate, shortage and average age of apheresis platelets. A comprehensive literature review was conducted on previous models studied to efficiently distribute blood products. However, most of the research on blood inventory management has been restricted to the hospital blood bank level in terms of ordering policies and inventory levels. This study takes the approach from the perspective of the inventory manager at the regional blood center. The inventory manager needs a reliable forecast of the quantity and timing of future blood supply (collection from donors) and blood demand from hospital blood banks to make an effective decision on blood inventory control. A forecasting method is used in this study to predict collection and demand for Single Donor Platelets (SDPs), and solves the blood inventory problem using a heuristic method and a Linear Programming (LP) with a rolling horizon method to find the near optimal issuing policy, the expected average age, outdate rate, and shortage rate of a blood product from the perspective of the blood center. It is concluded that regional blood centers can distribute with a ‘mixed’ FIFO/LIFO strategy and not significantly affect outdates or ability to cover shortages. For the LP model with a rolling horizon schedule, the inventory manager at the blood center would have to use forecast windows of five to achieve good issuing policies. A simulation study comparing the heuristic method and an LP-based with a rolling horizon method indicated that LP models with forecast windows of five and heuristics methods with a ‘mixed’ FIFO/LIFO strategy can be used to optimize this inventory problem

Supply Chain Coordination for False Failure Returns (ed.2)

False failure returns are products that are returned by consumers to retailers with no functional cosmetic defect. The cost of a false failure return includes the processing actions of testing, refurbishing if necessary, repackaging, the loss in value during the time the product spends in reverse supply chain (a time that can exceed several months for many firms), and the loss in revenue because the product is sold at a discounted price. This cost is significant, and is incurred primarily by the manufacturer. Reducing false failure returns, however, requires effort primarily by the retailer, for example informing consumers about the exact product that best fits their needs. We address the problem of reducing false failure returns via supply chain coordination methods. Specifically, we propose a target rebate contract that pays the retailer a specific dollar amount per each unit of false failure returns below a target. This target rebate provides an incentive to the retailer to increase her effort, thus decreasing the number of false failures and (potentially) increasing net sales. We show that this contract is Pareto–improving in the majority of cases. Our results also indicate that the profit improvement to both parties, and the supply chain, is substantial

To develop an integrated model for green supply chain

Supply chain management is a set of techniques used for effective and efficient integration of suppliers, manufacturers, warehouses and dealers in such a way that system costs to be minimized and goods service needs to be realized with the correct number in the right place and at the right time. Since the important role of three factors of localization, routing and assignment is not covered in the survival of a supply chain life, therefore, integration of these factors will result in an effective supply chain. This research aims to study the issue of supply chain network design including the localization of facilities, allocation flow among facilities and routing decisions. The issue is to determine the number, location and capacity levels of distribution centers, to allocate customers to distribution centers and distribution centers to suppliers and routing decisions such as determination of the products transport route from distributors to customers and type of transport vehicles so that the total cost of the system to be minimized and customer coverage to be maximized. In addition to reducing costs and increasing quality, improving the environmental performance of the supply chain and decreasing the costs of environmental degradation is also included in the proposed issue.This necessity which is known as a green supply chain is observed by choosing vehicles with lower emissions and reducing transport distances.On the other hand, this research role includes the impact of sharing information through raising and reducing waiting times for carriers. All of the above will be formulated by an integer linear programming model. Given that the mentioned issue is located in the group of problems with hard complexity, this article suggests using multi-objective meta-heuristic algorithms for optimization of the problem and compares the efficiency of the proposed algorithms with each other using several random sample problems.Keywords: Localization, routing, allocation, green supply chain, sharing informatio

Psychological Effect of Brand Image and Brand Reputation on Sustainable Firm Performance in Indonesian Logistic Companies

Abstract- This study examined the relationship between brand image, brand reputation, brand goodwill and sustainable firm performance (FP). The purpose of this study is to examine the psychological effect of brand image and brand reputation on sustainable FP of Indonesian logistic companies. This purpose was achieved by using primary data which was collected with the help of questionnaire. A survey was carried out among the Indonesian logistic companies with the help of questionnaires. 500 questionnaires were distributed, and 270 valid responses were used for data analysis. Smart PLS was used for data analysis. Results of the study highlighted that brand image and brand reputation has significant psychological effect on sustainable FP of logistic companies. Any change in the brand image and brand reputation has significant psychological effect which has contribution to decrease or increase the sustainable FP. Moreover, goodwill also has important role in sustainable FP. Both brand image and brand reputation effect on brand goodwill and finally, brand goodwill influences the sustainable FP

Analysis and Management of Bottlenecks in Supply Networks : Towards a Structured Approach to Stabilization of Inbound Material Flow

PhD thesis in Structural Engineering and Material ScienceAny organization whose business model is based on production relies, and is dependent, on providers of raw material which it transforms into products. Customers’ demand for products, and thus the producing firm’s demand for raw material, generally are not static but change with economic cycles, marketing, entries and exits of competitors, and changing consumer behavior, to name but a few factors. A variety of forecast methods support organizations in their effort to be prepared for demand changes, yet uncertainty about the volumes the market will demand cannot be fully eliminated. The design and management of supply networks has therefore increasingly shifted in the focus of attention as they provide levers for organizations to cope with variability. This thesis aims to augment theory and practice in the management of supply networks by providing a different perspective, a new angle, from where to analyze and to steer the buying firm’s inbound material stream. A bottleneck perspective will be developed in the course of the thesis, and it will be complemented by the identification and discussion of distinct bottleneck management activities, each of which comprised by a multitude of individual measures. Some of these measures fulfill very particular roles, and some serve multiple roles at once, so that the context in which to use these measures is important. Moreover, the discussion of supply networks and activities aimed at securing supply provides clarification as to the popular notions of supply chains and Supply Chain Management (SCM). It will be demonstrated how these concepts collide with actual network structures as well as with common practice. A comprehensive review of literature brings together insights from research fields as diverse as manufacturing systems, systems theory, complexity, and network theory. This review provides the backbone for the development of a tentative conceptual model that will guide the processes of data collection and analysis. The insights from the data analysis and how they relate to the existing body of knowledge are used to devise the foundation of a theory of bottleneck management in supply networks

Modelling, Monitoring, Control and Optimization for Complex Industrial Processes

This reprint includes 22 research papers and an editorial, collected from the Special Issue "Modelling, Monitoring, Control and Optimization for Complex Industrial Processes", highlighting recent research advances and emerging research directions in complex industrial processes. This reprint aims to promote the research field and benefit the readers from both academic communities and industrial sectors

Design and Analysis of Robust Kanban System in an Uncertain Environment

Kanban is a representative control policy pursuing cost-efficient features for the material flow system. However, the Kanban mechanism increases the system vulnerability especially when the environment is uncertain. Therefore, we proposed a robust Kanban system model for the supply chain system based on the Kanban mechanism. The model can use robust approaches from strategic, tactical, and operational levels to deal with the risks in an uncertain environment

A new perspective on Workload Control by measuring operating performances through an economic valorization

Workload Control (WLC) is a production planning and control system conceived to reduce queuing times of job-shop systems, and to offer a solution to the lead time syndrome; a critical issue that often bewilders make-to-order manufacturers. Nowadays, advantages of WLC are unanimously acknowledged, but real successful stories are still limited. This paper starts from the lack of a consistent way to assess performance of WLC, an important burden for its acceptance in the industry. As researchers often put more focus on the performance measures that better confirm their hypotheses, many measures, related to different WLC features, have emerged over years. However, this excess of measures may even mislead practitioners, in the evaluation of alternative production planning and control systems. To close this gap, we propose quantifying the main benefit of WLC in economic terms, as this is the easiest, and probably only way, to compare different and even conflicting performance measures. Costs and incomes are identified and used to develop an overall economic measure that can be used to evaluate, or even to fine tune, the operating features of WLC. The quality of our approach is finally demonstrated via simulation, considering the 6-machines job-shop scenario typically adopted as benchmark in technical literature