Using inventory to mitigate the Ripple effect

A single disruption at a single location within a supply chain may effect many other locations of a the supply chain through the Ripple effect (Ivanov et al., 2014). In this article we focus on the role of inventory to mitigate the Ripple effect. Our main finding states that operational decisions (such as safety inventory level or service level) are highly interrelated with decisions that mitigate the Ripple effect (such as a high Resilience of the supply chain). Specifically, we find: 1) An increase in demand volatility may lead a firm to invest more in operational safety stock as well as in dedicated Risk Mitigation Inventory. 2) A high service level and high resilience of a supply chain can be conflicting objectives

Supply chain uncertainty:a review and theoretical foundation for future research

Supply-chain uncertainty is an issue with which every practising manager wrestles, deriving from the increasing complexity of global supply networks. Taking a broad view of supply-chain uncertainty (incorporating supply-chain risk), this paper seeks to review the literature in this area and develop a theoretical foundation for future research. The literature review identifies a comprehensive list of 14 sources of uncertainty, including those that have received much research attention, such as the bullwhip effect, and those more recently described, such as parallel interaction. Approaches to managing these sources of uncertainty are classified into: 10 approaches that seek to reduce uncertainty at its source; and, 11 approaches that seek to cope with it, thereby minimising its impact on performance. Manufacturing strategy theory, including the concepts of alignment and contingency, is then used to develop a model of supply-chain uncertainty, which is populated using the literature review to show alignment between uncertainty sources and management strategies. Future research proposed includes more empirical research in order to further investigate: which uncertainties occur in particular industrial contexts; the impact of appropriate sources/management strategy alignment on performance; and the complex interplay between management strategies and multiple sources of uncertainty (positive or negative)

Modelling the impact of liner shipping network perturbations on container cargo routing: Southeast Asia to Europe application

Understanding how container routing stands to be impacted by different scenarios of liner shipping network perturbations such as natural disasters or new major infrastructure developments is of key importance for decision-making in the liner shipping industry. The variety of actors and processes within modern supply chains and the complexity of their relationships have previously led to the development of simulation-based models, whose application has been largely compromised by their dependency on extensive and often confidential sets of data. This study proposes the application of optimisation techniques less dependent on complex data sets in order to develop a quantitative framework to assess the impacts of disruptive events on liner shipping networks. We provide a categorization of liner network perturbations, differentiating between systemic and external and formulate a container assignment model that minimises routing costs extending previous implementations to allow feasible solutions when routing capacity is reduced below transport demand. We develop a base case network for the Southeast Asia to Europe liner shipping trade and review of accidents related to port disruptions for two scenarios of seismic and political conflict hazards. Numerical results identify alternative routing paths and costs in the aftermath of port disruptions scenarios and suggest higher vulnerability of intra-regional connectivity

Practical Supply Chain Management Knowledge from Industry-Academia Dialogue

Value co-creation, which can be defined as a joint initiative by two or more supply chain members to create value that cannot be created by the sole effort of one member, is a cornerstone concept in Supply Chain Management (SCM). To provide needed clarity about the concept, the invitation-only summit World Class Supply Chain 2017: Value Co-creation , was convened on May 10th, 2017 in Milton, Ontario. The summit brought together accomplished executives, scholars, and students in the SCM field to engage in dialogue directed at uncovering actionable insights about three crucial issues: The business benefits of value co-creation The actions required for successful value co-creation The obstacles to value co-creation and ways to overcome them The deliberations covered an extensive range of content that included concrete real-world examples to reinforce the insights. Those insights can be summarized in the following three major points: Information technology innovations can (a) come from an industry’s established players instead of only from new entrants and (b) significantly improve not only standard operational efficiency metrics in supply chains but also how supply chains parties interact with each other to create value. The suite of key success factors in value co-creation spans three major stages of activities for any organization: (i) preparing for its discussions with potential co-creation partners, (ii) having those discussions with an intent to find common ground on the most important partnership parameters, and (iii) managing the ongoing relationship(s) with selected partners. To be better poised for future success in value co-creation, today’s young, upcoming professionals (e.g., internship and entry-level jobs) must have jobs that are designed with a view to nurturing interpersonal skills in forming and sustaining effective inter-organizational business relationships

Overview and classification of coordination contracts within forward and reverse supply chains

Among coordination mechanisms, contracts are valuable tools used in both theory and practice to coordinate various supply chains. The focus of this paper is to present an overview of contracts and a classification of coordination contracts and contracting literature in the form of classification schemes. The two criteria used for contract classification, as resulted from contracting literature, are transfer payment contractual incentives and inventory risk sharing. The overview classification of the existing literature has as criteria the level of detail used in designing the coordination models with applicability on the forward and reverse supply chains.Coordination contracts; forward supply chain; reverse supply chain

National Culture\u27s Impact on Effectiveness of Supply Chain Disruption Management

The purpose of this research is to understand the national cultural antecedents that may help explain differences in supply chain disruptions mitigation abilities of companies from different countries. An analysis of survey data on disruption planning and response collected from various organizations worldwide was performed using weighted least square regression and factor analysis. We find that culture influences disruption planning and response. Statistical findings suggest that differences in disruption planning and response abilities between companies from different countries could be partly attributed to national culture. All five Hofstede’s dimensions of national culture, i.e., Power Distance, Individualism, Masculinity, Uncertainty Avoidance, and Long-term Orientation were shown to have a significant positive effect on disruption planning and response. National cultural dimensions and economic status of a country could be effectively used to predict disruption planning and response abilities of companies in various countries. Managers could benefit from our research as it could help them assess disruptions mitigation abilities of their partners located in other countries. Increasing international trade and globalization of supply chains accentuate the importance of our research

10-01 "Climate-Resilient Industrial Development Paths: Design Principles and Alternative Models"

Global climate change is here. According to recent scientific reports, the earth has warmed by nearly half a degree centigrade over the last twenty five years. Even with robust mitigation efforts, the global climate could warm by up to 4 degrees centigrade due to past emissions. Under a business-as-usual, high consumption fossil fuel-based development path, it could warm even more, resulting in catastrophic and life-threatening destruction of earth’s eco-systems. The “climate imperative”—the urgent need to both mitigate and adapt to global climate change—has important implications for economic development paths in general and industry and energy policies in particular. Development models and practice historically have treated climate—and indeed, the natural environment in general—as exogenous. Future development models will need to incorporate both climactic uncertainty and the economic threats and opportunities arising from an evolving global climate regime. Developing countries, which are especially vulnerable to climate instability, will need to design energy and industry policies which aim to achieve not only economic and social objectives but which also enhance climate resilience. This paper explores the broad contours of climate resilient industrial development paths. It defines development as an increase in local capacities for production and innovation and argues that the overarching goal of development is the generation of sustainable livelihoods. It suggests that. to be climate resilient, industry policies should have four key design features: 1) they are pro-active; 2) they promote industrial diversification; 3) they focus on mobilizing investment in environmentally sustainable industries and infrastructure, including low-carbon and renewable energy; 4) they are highly responsive to local geo-physical conditions and are based on principles of adaptive management; and 5) they are designed, implemented and governed via accountable partnerships involving government, business, and community actors. The paper evaluates three development macro-models—neo-liberal, sustainable globalization, and new developmental—against the five design principles and finds that aspects of both climate vulnerability and climate-resilience are embodied in each. The paper concludes that responding to the climate imperative will require not a new synthesized one-size-fits-all model but a multiplicity of economic development paths. The effort to articulate the theory and praxis of such paths has barely begun.