One vendor-one retailer in vendor managed inventory problem with stochastic demand

One of the basic problems in supply chain operation is lack of information exchanges related to inventory between vendor and retailer. Vendor managed inventory (VMI) provides a good approach to handle this problem. VMI has been proven to reduce cost and improve customer service level. This research aim is to develop a VMI model for the system with one vendor and one retailer to minimise the total system cost. The model is developed for (t, q) policy where the retailer’s cycle time is fixed. Due to the complexity nature of the model, simulation-optimisation using genetic algorithm is employed to determine the decision variables which are the retailer’s lot size, the vendor’s lot size, and the number of replenishments in a vendor cycle. Numerical experiments are conducted to show how the proposed model works. Sensitivity analysis is also conducted to understand the effects of some input parameters

Low carbon decision-making model under the combined effect of corporate social responsibility and overconfidence

This paper explores the impact of retailers' corporate social responsibility (CSR) and manufacturers' overconfidence on manufacturers' carbon reduction in sustainable supply chains. We analyze the profits of manufacturers and retailers under different scenarios and explore the social welfare and environmental impacts under CSR. Our results suggest that retailers' CSR and manufacturers' overconfidence contribute positively to promoting carbon mitigation and reducing environmental impacts under certain conditions. However, with increasing CSR and manufacturer overconfidence levels, manufacturers are more likely to lead to worse environmental impacts and carbon emission reduction. In addition, we show that when the manufacturer's overconfidence level is high, manufacturers and retailers are more profitable and contribute to carbon emission reductions in the manufacturer without overconfidence (retailer without CSR) scenario. Moreover, we find that firms have the higher potential to capture optimal overall social welfare in the presence of retailers with CSR and manufacturer overconfidence

One vendor and multiple retailers system in vendor managed inventory problem with stochastic demand

In many supply networks, the retailers are reluctant to share information about demand and inventory level to the vendor. This might lead to many difficulties for the vendor in establishing his own order/production plan. Vendor managed inventory (VMI) policy can help to solve that problem. By applying VMI, information sharing is not really a problem for the vendor anymore and this policy have been proven to help reduce total inventory cost as well as improve customer service level in the supply network. In this research, a VMI model for the system with one vendor and multiple retailers will be developed. The main target of the model is to determine the retailer’s lot size, the vendor’s lot size, the retailer cycle time, and the number of replenishments in a vendor cycle so as to minimise the total system cost. For solution purpose, simulation-optimisation technique using genetic algorithm is employed to help find optimal solutions for the decision variables. Numerical experiments are conducted to show the applicability of the proposed model. Sensitivity analysis is also conducted to examine the effects of some input parameters on the optimal solution

Volume II Acquisition Research Creating Synergy for Informed Change, Thursday 19th Annual Acquisition Research Proceedings

ProceedingsApproved for public release; distribution is unlimited

Corporate brand architecture in cross-border mergers and acquisitions

Crossborder merger and acquisition (CBM&A) is a dynamic and sustainable competitive strategy. However, the related issue of corporate brand architecture (CBA) has been emphasized to a limited extent in the last five decades of CBM&A studies. Consequently, this research endeavors to scrutinize the antecedents and performance of functionally effective CBA standardization in the postCBM&A phase. This study develops a theoretical framework based on the ResourceBased View and Industrial Organization theory in view of the StructureConductPerformance model. A web survey was conducted based on 124 acquiring companies in 29 countries that were engaged in CBM&A deals between 1990 and 2014. The PLSSEM method was applied to analyze the survey data using SmartPLS professional version 3. The empirical findings show that the firm’s intangible and strategic resources – such as the acquirer’s stronger brand management system, corporate reputation, corporate brand power and acquisition motives (i.e., global presence and extension of sales opportunities) – lead to a high degree of CBA standardization, while the stronger customerbased equity of the target yields a low degree of such standardization. Also, market orientation has a positive impact on the brand management system. Market factors such as the micro and macro environmental distance lead to a high degree of CBA standardization, while the acquirer’s country brand equity indirectly influences the high degree of CBA standardization through brand management system and corporate reputation. Remarkably, competitive intensity has no effect on CBA standardization. Moreover, a high degree of CBA standardization yields superior financial performance indirectly through synergistic competitive advantage and market performance in postCBM&A. Particularly, market performance has a substantial direct effect on financial performance compared to synergistic competitive advantage. This study suggests that the acquirer’s executives should sequentially apply firm and marketlevel factors such as brand management system, corporate reputation, corporate brand power, low customerbased equity of the target, micro and macro environmental distance, country brand equity, and acquisition motives to achieve an optimum degree of CBA standardization in postCBM&A. Similarly, the synergistic competitive advantage and market performance should be regarded sequentially as well to achieve superior financial performance in terms of the degree of CBA standardization. It is deemed that the findings as a whole establish a framework for the practice of corporate brand architecture in postCBM&A.Kansainvälinen fuusio ja yritysosto (CBM&A) on dynaaminen ja kestävä kilpailustrategia. Siihen liittyvää kysymystä yrityksen brändiarkkitehtuurista (CBA) ei kuitenkaan ole painotettu riittävästi CBM&A:ta koskevassa tutkimuksessa viimeisten viiden vuosikymmenen aikana. Tämä väitöstutkimus pyrkiikin selvittämään brändiarkkitehtuurin tehokkaan standardoinnin lähtökohtia ja tuloksia fuusion tai yrityskaupan jälkeisessä tilanteessa. Tutkimuksessa kehitetään resurssiperustaiseen näkemykseen (RVB) ja teollisen organisaation (IO) teoriaan pohjautuva teoreettinen viitekehys yrityksen kilpailutilannetta arvioivan SCPmallin (StructureConductPerformance) näkökulmasta. Tutkimus toteutettiin tekemällä verkkokysely 124:lle yritysjärjestelyissä vuosien 1990–2014 aikana mukana olleelle yritykselle 29 maassa. Tulokset analysoitiin käyttämällä osittaisten pienimpien neliösummien ja rakenneyhtälömallinnusta (PLSSEM) SmartPLS professional ohjelmiston versiolla 3. Empiirisen tulokset osoittavat, että yrityksen resurssit, kuten esimerkiksi ostajan vahvemmat brändijohtamisjärjestelmät, yrityksen maine, yrityksen brändin voima ja ostomotiivit – vaikuttavat positiivisesti brändiarkkitehtuurin korkeaan standardointiasteeseen. Toisaalta ostokohteen vahvempi asiakaslähtöinen brändin pääoma johtaa matalampaan standardointiasteeseen. Myös markkina¬orientoituneisuudella on positiivinen vaikutus brändin johtamisjärjestelmiin. Markkinatekijöillä kuten myyjän ja ostokohteen mikro ja makroympäristöjen etäisyydellä on positiivinen vaikutus brändiarkkitehtuurin standardointiin. Tästä huolimatta ostajan maan brändipääoma vaikuttaa epäsuorasti standardoinnin asteeseen brändijohtamisjärjestelmien ja yrityksen maineen kautta. Yllättävää kyllä, kilpailuintensiteetillä ei ollut vaikutusta standardointiin. Tämän lisäksi korkea standardointiaste johtaa epäsuorasti synergististen kilpailuetujen ja yrityksen markkinoilla menestymisen kautta parempaan taloudelliseen tulokseen yritysjärjestelyn jälkeisessä tilanteessa. Erityisesti markkkinoilla menestymisellä on tuntuva suora vaikutus taloudelliseen tulokseen synergistiseen kilpailuetuun verrattuna. Tämän tutkimuksen mukaan ostajan johtajien tulisi järjestelmällisesti käyttää yritys ja markkinatason tekijöitä kuten brändin johtamisjärjestelmiä, yrityksen mainetta, yrityksen brändivoimaa, ostokohteen matalaa asiakaslähtöistä brändipääomaa, mikro ja makroympäristön etäisyyttä, maan brändipääomaa ja ostomotiiveita päästäkseen tehokkaaseen brändiarkkitehtuurin standardisointiin yritysoston tai fuusion jälkeisessä tilanteessa. Samalla tavoin synergististä kilpailuetua ja markkinatulosta tulisi tarkastella säännöllisesti, jotta brändiarkkitehtuurin standardisoinnin kautta voitaisiin saavuttaa taloudellista menestystä. Kokonaisuudessaan tulokset muodostavat viitekehyksen yritysoston tai fuusion jälkeiselle brändiarkkitehtuurin soveltamiselle.fi=vertaisarvioitu|en=peerReviewed

Contingency theories of order management, capacity planning, and exception processing in complex manufacturing environments

Technological development and market diversification increase the complexity of modern manufacturing environments. Although the popular literature on lean management practices and quality improvement programs describe numerous ways of decreasing the complexity of manufacturing processes, the complete elimination of complexity is seldom possible. Thus, one needs to understand how to mitigate the performance effects of complexity with appropriate management practices. The research questions of this dissertation ask first, what do we already know about operations management under complexity, and second, how the applicability of day-to-day operations management practices depends upon the different dimensions of complexity. The research question on the existing knowledge about operations management under complexity is answered in two steps. First, I present a comprehensive review of organization-theoretical literature on the concept of complexity. This review results in a number of propositions on different ways of managing complexity. Second, I analyze the evidence for those propositions in a systematic literature review of recent operations management research. The results of that review point to a number of contribution opportunities, which guide the empirical studies that address my second research question. The research question on the applicability of operations management practices under different kinds of complexity is addressed with three studies within the same focused sample of 163 machinery manufacturing processes. The first study examines how the applicability of different order management practices depends upon the complexity arising from product customization. The second study examines the effects of process complexity on the applicability of different capacity planning methods. The third study examines the effects of different kinds of uncertainties on the applicability of different exception processing routines. As the studied practices begin from the acquisition of orders and end in the delivery of products, they constitute a holistic view of day-to-day operations management in manufacturing firms. The empirical analyses result in three contingency-theoretical propositions. First, I argue that product configurator tools, available-to-promise verifications, and configuration management practices are only applicable with specific levels of customization in products' configurations and components. Second, I argue that rough-cut capacity planning methods are only applicable with job-shop processes, capacity requirement planning is only applicable with batch-shop processes, and finite loading methods are only applicable with bottleneck-controlled batch shops and assembly lines. Third, I argue that only formal automated exception reporting channels are applicable when urgent glitches are being resolved in production processes. Meanwhile, only formal interpersonal exception reporting channels are applicable when equivocal glitches are being resolved. The theses have immediate practical implications for managers who are responsible for production processes in complex task environments. The studies show that none of this dissertation's theses are commonly known by practitioners nor discussed in the literature. In addition to the immediate implications for the studied environments, the theses can be theoretically generalized to other environments that satisfy certain boundary conditions. Examples can be found in service production, healthcare operations, and software development. The resulting middle-range theories of operations management in complex task environments can be tested in future studies with random samples of processes from other operations management contexts

Rethinking the risk matrix

So far risk has been mostly defined as the expected value of a loss, mathematically PL (being P the probability of an adverse event and L the loss incurred as a consequence of the adverse event). The so called risk matrix follows from such definition. This definition of risk is justified in a long term “managerial” perspective, in which it is conceivable to distribute the effects of an adverse event on a large number of subjects or a large number of recurrences. In other words, this definition is mostly justified on frequentist terms. Moreover, according to this definition, in two extreme situations (high-probability/low-consequence and low-probability/high-consequence), the estimated risk is low. This logic is against the principles of sustainability and continuous improvement, which should impose instead both a continuous search for lower probabilities of adverse events (higher and higher reliability) and a continuous search for lower impact of adverse events (in accordance with the fail-safe principle). In this work a different definition of risk is proposed, which stems from the idea of safeguard: (1Risk)=(1P)(1L). According to this definition, the risk levels can be considered low only when both the probability of the adverse event and the loss are small. Such perspective, in which the calculation of safeguard is privileged to the calculation of risk, would possibly avoid exposing the Society to catastrophic consequences, sometimes due to wrong or oversimplified use of probabilistic models. Therefore, it can be seen as the citizen’s perspective to the definition of risk