Decision support for build-to-order supply chain management through multiobjective optimization

This is the post-print version of the final paper published in International Journal of Production Economics. The published article is available from the link below. Changes resulting from the publishing process, such as peer review, editing, corrections, structural formatting, and other quality control mechanisms may not be reflected in this document. Changes may have been made to this work since it was submitted for publication. Copyright @ 2010 Elsevier B.V.This paper aims to identify the gaps in decision-making support based on multiobjective optimization (MOO) for build-to-order supply chain management (BTO-SCM). To this end, it reviews the literature available on modelling build-to-order supply chains (BTO-SC) with the focus on adopting MOO techniques as a decision support tool. The literature has been classified based on the nature of the decisions in different part of the supply chain, and the key decision areas across a typical BTO-SC are discussed in detail. Available software packages suitable for supporting decision making in BTO supply chains are also identified and their related solutions are outlined. The gap between the modelling and optimization techniques developed in the literature and the decision support needed in practice are highlighted. Future research directions to better exploit the decision support capabilities of MOO are proposed. These include: reformulation of the extant optimization models with a MOO perspective, development of decision supports for interfaces not involving manufacturers, development of scenarios around service-based objectives, development of efficient solution tools, considering the interests of each supply chain party as a separate objective to account for fair treatment of their requirements, and applying the existing methodologies on real-life data sets.Brunel Research Initiative and Enterprise Fund (BRIEF

The Political Economy of Industrial Policy in China: The Case of Aircraft Manufacturing

Since 1960, only one new country, Brazil, has succeeded in delivering more than one civil jet per month. Otherwise, all the countries now offering world-class planes were established in aviation by the end of World War I. This being said, low-cost producers within several of the newly emerging markets have already acquired front-end manufacturing expertise as a direct result of industrial offset contracts and/or other forms of technology transfer. In all such cases, government intervention, notably through state ownership, has been predominant, but failures have been numerous in view of the difficulty of aligning ownership structure to financial, managerial, and technological requirements and of garnering the support of domestic interest groups. In this paper the focus is China’s efforts to build a world-class aircraft manufacturing industry. In the first half of the 1990s the potential of the Chinese industry to mount a competitive challenge to Western aircraft builders was largely discounted. Nowadays, as China strives to bear the ARJ-21 project to execution and even considers entering the market for wide-bodies, the threat is taken more seriously. The growth in the Chinese air transport market has reinforced the bargaining power of national aircraft producers and authorities are giving priority to building science and technology capacity in this area. Progress in creating military/civilian synergies has proven much more modest – especially when compared to the shipbuilding industry – and better coordination in the overall industry comes a distant fourth in the explanations’ peaking order.http://deepblue.lib.umich.edu/bitstream/2027.42/40165/3/wp779.pd

Platforms, network effects and small business dynamics in China : case study of the Shanzhai cell phone industry

This paper seeks to argue the significance of platforms on emerging markets through a case study of the Shanzhai cell phone industry in Shenzhen, China. In this industry, value chains are being driven by both the technology platforms and the market platforms. The former include MTK baseband chipset, and so-called Shared PCBA and Shared Mould. The latter include the North Huaqiang Market and the Purchasing and Money Platform. Technology platforms greatly reduced the technological barriers to entry for independent design houses and system integrators, while market platforms markedly improved their poor marketing and purchasing abilities. Due to factors such as social networks, supporting industries, informality and platform governance, strong network effects have been exhibited in the two types of platforms, which have not only fostered numerous start-ups, but have also led to effective exploitation of emerging markets.China, Electronic industries, Telephone, Network, Platform, Network effect, Shanzhai Cell Phone, Emerging markets

Product Configuration Systems: State of the Art, Conceptualization and Extensions

Product configurators are considered to be among the most successful applications of artificial intelligence technology. In this paper, we determine different conceptualizations of configurators and condense them in a comprehensive morphological box, which should support configurator designers as well as decision makers in selecting the right system. The analysis of the criteria according to which configurators that are designed thus far reveals a neglect of the front-end perspective. Therefore, it is relevant to extend configurators with a front-end component assisting customers during product configuration through advisory. We develop a framework describing the main requirements on an advisory system and propose the technical infrastructure for its implementation. Finally, the advisory system and the configurator are integrated into a comprehensive interaction system.product configurators; advisory system; product personalization

Decision support for build-to-order supply chain management through multiobjective optimization

This paper aims to identify the gaps in decision-making support based on multiobjective optimization for build-to-order supply chain management (BTOSCM). To this end, it reviews the literature available on modelling build-to-order supply chains (BTO-SC) with the focus on adopting multiobjective optimization (MOO) techniques as a decision support tool. The literature has been classified based on the nature of the decisions in different part of the supply chain, and the key decision areas across a typical BTO-SC are discussed in detail. Available software packages suitable for supporting decision making in BTO supply chains are also identified and their related solutions are outlined. The gap between the modelling and optimization techniques developed in the literature and the decision support needed in practice are highlighted and future research directions to better exploit the decision support capabilities of MOO are proposed

A Framework for Understanding the Interdependencies between Mass Customization and Complexity

Mass customization is a business strategy that aims at satisfying individual customer needs, nearly with mass production efficiency. It induces a high complexity level because of various customer requirements and a steadily changing environment. However, mass customization has some potential to reduce complexity. The interdependencies between mass customization and complexity are discussed in order to demonstrate that mass customization is not just an oxymoron linking two opposite production concepts, but a business strategy that contributes towards reaching a competitive advantage. On the one hand, mass customization increases the production program, manufacturing and configuration complexities. On the other hand, it contributes to reduce complexity at the levels of order taking process, product and inventories. The main results attained through the analysis are integrated in a comprehensive framework that shows the complexity increasing and complexity decreasing aspects due to mass customization.Mass Customization; Complexity Management; Product Variety

The Political Economy of Industrial Policy in China: The Case of Aircraft Manufacturing

Since 1960, only one new country, Brazil, has succeeded in delivering more than one civil jet per month. Otherwise, all the countries now offering world-class planes were established in aviation by the end of World War I. This being said, low-cost producers within several of the newly emerging markets have already acquired front-end manufacturing expertise as a direct result of industrial offset contracts and/or other forms of technology transfer. In all such cases, government intervention, notably through state ownership, has been predominant, but failures have been numerous in view of the difficulty of aligning ownership structure to financial, managerial, and technological requirements and of garnering the support of domestic interest groups. In this paper the focus is China’s efforts to build a world-class aircraft manufacturing industry. In the first half of the 1990s the potential of the Chinese industry to mount a competitive challenge to Western aircraft builders was largely discounted. Nowadays, as China strives to bear the ARJ-21 project to execution and even considers entering the market for wide-bodies, the threat is taken more seriously. The growth in the Chinese air transport market has reinforced the bargaining power of national aircraft producers and authorities are giving priority to building science and technology capacity in this area. Progress in creating military/civilian synergies has proven much more modest – especially when compared to the shipbuilding industry – and better coordination in the overall industry comes a distant fourth in the explanations’ peaking order.aerospace, China

Designing a supply network for a startup company

Thesis (M. Eng. in Logistics)--Massachusetts Institute of Technology, Engineering Systems Division, 2010.Cataloged from student submitted PDF version of thesis.Includes bibliographical references (p. 86-88).Our thesis introduces a supply chain framework catered for startup companies. Startup companies face unique circumstances such as constraints on financial and human resources, and greater uncertainty in demand. From our work with XL Hybrids, a startup company that hybridizes aftermarket vehicles, as well as interviews and literature review, we have attempted to distill supply chain strategies that can be applied to startup companies. To plan XL Hybrids' supply chain, we developed models for the following aspects of their supply chain: production scheduling, capacity planning, inventory policy, and component distribution. By running different demand and pricing scenarios, we gained an understanding of the impact of these variables on the four aspects of XL Hybrid's supply chain. Based on the scenario analysis and supply chain framework that we developed, we recommend that XL Hybrids be conservative with capacity expansion while strategically sourcing key components after considering volume discounts and different distribution methods.by Marcus S. Causton and Jianmin Wu.M.Eng.in Logistic

Inventory drivers in a pharmaceutical supply chain

In recent years, inventory reduction has been a key objective of pharmaceutical companies, especially within cost optimization initiatives. Pharmaceutical supply chains are characterized by volatile and unpredictable demands –especially in emergent markets-, high service levels, and complex, perishable finished-good portfolios, which makes keeping reasonable amounts of stock a true challenge. However, a one-way strategy towards zero-inventory is in reality inapplicable, due to the strategic nature and importance of the products being commercialised. Therefore, pharmaceutical supply chains are in need of new inventory strategies in order to remain competitive. Finished-goods inventory management in the pharmaceutical industry is closely related to the manufacturing systems and supply chain configurations that companies adopt. The factors considered in inventory management policies, however, do not always cover the full supply chain spectrum in which companies operate. This paper works under the pre-assumption that, in fact, there is a complex relationship between the inventory configurations that companies adopt and the factors behind them. The intention of this paper is to understand the factors driving high finished-goods inventory levels in pharmaceutical supply chains and assist supply chain managers in determining which of them can be influenced in order to reduce inventories to an optimal degree. Reasons for reducing inventory levels are found in high inventory holding and scrap related costs; in addition to lost sales for not being able to serve the customers with the adequate shelf life requirements. The thesis conducts a single case study research in a multi-national pharmaceutical company, which is used to examine typical inventory configurations and the factors affecting these configurations. This paper presents a framework that can assist supply chain managers in determining the most important inventory drivers in pharmaceutical supply chains. The findings in this study suggest that while external and downstream supply chain factors are recognized as being critical to pursue inventory optimization initiatives, pharmaceutical companies are oriented towards optimizing production processes and meeting regulatory requirements while still complying with high service levels, being internal factors the ones prevailing when making inventory management decisions. Furthermore, this paper investigates, through predictive modelling techniques, how various intrinsic and extrinsic factors influence the inventory configurations of the case study company. The study shows that inventory configurations are relatively unstable over time, especially in configurations that present high safety stock levels; and that production features and product characteristics are important explanatory factors behind high inventory levels. Regulatory requirements also play an important role in explaining the high strategic inventory levels that pharmaceutical companies hold