Optimal two-period inventory allocation under multiple service level contracts

Optimal inventory allocation policies have a significant impact on profits in the retail industry. A manufacturer ships products to the retailers' stores where the end customers buy the product during the selling season. It has been put forward that it is beneficial for the manufacturer to reserve a certain fraction of the inventory for a second replenishment. Then the manufacturer can replenish the retailers' inventories optimally and can take advantage of the risk pooling effect. In practice, retailers require a certain availability of the product throughout the selling season. Supply contracts are used to coordinate the delivery of products. Under such a contract, the manufacturer agrees to achieve a certain service level and to pay a financial penalty if she misses it. We analyze how a manufacturer responds to a service level contract if she wants to minimize her expected costs. We develop an allocation strategy for the multiple retailer case and find that our results allow for a better understanding of the effect of service level contracts on manufacturers and retailers. (C) 2016 Elsevier B.V. All rights reserved

Methodology and model-based DSS to managing the reallocation of inventory to orders in LHP situations. Application to the ceramics sector

[EN] Lack of homogeneity in the product (LHP) is a problem when customers require homogeneous units of a single product. In such cases, the optimal allocation of inventory to orders becomes much more complex. Furthermore, in an MTS environment, an optimal initial allocation may become less than ideal over time, due to different circumstances. This problem occurs in the ceramics sector, where the final product varies in tone and calibre. This paper proposes a methodology for the reallocation of inventory to orders in LHP situation (MERIO-LHP) and a model-based decision-support system (DSS) to support the methodology, which enables an optimal reallocation of inventory to order lines to be carried out in real businesses environments in which LHP is inherent. The proposed methodology and model-based DSS were validated by applying it to a real case at a ceramics company. The analysis of the results indicates that considerable improvements can be obtained with regard to the quantity of orders fulfilled and sales turnover.Oltra Badenes, RF.; Gil Gómez, H.; Merigó, JM.; Palacios Marqués, D. (2019). Methodology and model-based DSS to managing the reallocation of inventory to orders in LHP situations. Application to the ceramics sector. PLoS ONE. 14(7):1-19. https://doi.org/10.1371/journal.pone.0219433S119147Alarcón, F., Alemany, M. M. E., Lario, F. C., & Oltra, R. F. (2011). La falta de homogeneidad del producto (FHP) en las empresas cerámicas y su impacto en la reasignación del inventario. Boletín de la Sociedad Española de Cerámica y Vidrio, 50(1), 49-58. doi:10.3989/cyv.072011Wanke, P., Alvarenga, H., Correa, H., Hadi-Vencheh, A., & Azad, M. A. K. (2017). Fuzzy inference systems and inventory allocation decisions: Exploring the impact of priority rules on total costs and service levels. 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A DSS approach to managing customer enquiries for SMEs at the customer enquiry stage. International Journal of Production Economics, 103(1), 332-346. doi:10.1016/j.ijpe.2005.08.008Mahdavi Pajouh, F., Xing, D., Zhou, Y., Hariharan, S., Balasundaram, B., Liu, T., & Sharda, R. (2013). A Specialty Steel Bar Company Uses Analytics to Determine Available-to-Promise Dates. Interfaces, 43(6), 503-517. doi:10.1287/inte.2013.0693Yang, W., & Fung, R. Y. K. (2014). An available-to-promise decision support system for a multi-site make-to-order production system. International Journal of Production Research, 52(14), 4253-4266. doi:10.1080/00207543.2013.877612Castiglione, C., Alfieri, A., & Pastore, E. (2018). Decision Support System to balance inventory in customer-driven demand. IFAC-PapersOnLine, 51(11), 1499-1504. doi:10.1016/j.ifacol.2018.08.288Mhiri, E., Jacomino, M., Mangione, F., Vialletelle, P., & Lepelletier, G. (2015). Finite capacity planning algorithm for semiconductor industry considering lots priority. IFAC-PapersOnLine, 48(3), 1598-1603. doi:10.1016/j.ifacol.2015.06.314Alemany, M. M. E., Lario, F.-C., Ortiz, A., & Gómez, F. (2013). Available-To-Promise modeling for multi-plant manufacturing characterized by lack of homogeneity in the product: An illustration of a ceramic case. Applied Mathematical Modelling, 37(5), 3380-3398. doi:10.1016/j.apm.2012.07.022ALEMANY, M. M. E., A., A., BOZA, A., & FUERTES-MIQUEL, V. S. (2015). A MODEL-DRIVEN DECISION SUPPORT SYSTEM FOR REALLOCATION OF SUPPLY TO ORDERS UNDER UNCERTAINTY IN CERAMIC COMPANIES. Technological and Economic Development of Economy, 21(4), 596-625. doi:10.3846/20294913.2015.1055613Grillo, H., Alemany, M. M. E., & Ortiz, A. (2016). A review of mathematical models for supporting the order promising process under Lack of Homogeneity in Product and other sources of uncertainty. 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Propuesta de mejora de un sistema de gestión de inventarios y nivel de servicio para una cadena de suministro competitiva aplicando política óptima (r, q) en una empresa farmacéutica en Lima, Perú

El presente proyecto de investigación tiene como finalidad el desarrollo de una propuesta de mejora de un Sistema de Gestión de Inventarios aplicando la política (R, Q), metodología de una cadena de suministro competitiva e implementación de indicadores en el proceso crítico de una empresa dedicada a la comercialización de dispositivos médicos con la finalidad de resolver el problema identificado del bajo nivel de servicio comparado con el óptimo del sector y así aumentar su rentabilidad. Luego de aplicar las metodologías mencionadas, se logró afirmar las hipótesis y cumplir los objetivos planteados al inicio de la investigación, evidenciando dicho cumplimiento mediante la mejora de los resultados obtenidos con los indicadores en la situación actual de la empresa y posterior a la implementación de la mejora.The purpose of this project is to develop a proposal to improve an Inventory Management System applying the policy (R, Q), methodology of a competitive supply chain and implementation of indicators in the critical process of a company dedicated to commercialization of medical devices in order to solve the identified problem of the low service level compared to the optimum in the sector and therefore, increase its profitability. After applying the aforementioned methodologies, it was possible to affirm the hypotheses and meet the objectives set at the beginning of the research, evidencing the compliance by improving the results obtained with the indicators in the current situation of the company and after the implementation of the improvement.Trabajo de Suficiencia Profesiona

Information assurance within supply chains’ structures and processes.

Doctoral degree. University of KwaZulu-Natal, Durban.Organisations are challenging the traditional linear-based market model which is characterised by a straight line movement of goods and services. As a result, they are increasingly forming and moving towards a value web of supply chain network that connects a whole ecosystem of trading partners. These networks, which are mostly complex and dynamic, are creating a global market environment in which organisations no longer focus only on their immediate suppliers and customers, but also on the optimization and the smooth flow of information, funds and materials, within their respective direct and remote trading networks. The large number of participants within most supply chain networks has necessitated that these networks be agile and resilient. For supply chain networks to be agile and resilient, and for supply chains’ structures, processes and resources to be synchronized and integrated, the organisations within the supply chain must share information. Hence, in today’s supply chains, interests are moving towards obtaining the most benefits from information. In order to obtain these benefits from information, organisations are making use of information systems and their related technologies to acquire, process and adequately share information. These systems are making it possible for organisations to form strategic partnerships within the supply chain networks. The global market environment is causing supply chains to expand, and the expansion is exposing information to various security vulnerabilities and risks. The exposure of information to different vulnerabilities and risks is forcing trading partners to seek assurance that the information within their supply chain network is adequately protected and also performs as advertised. To understand how the assurance sought by trading partners can be provided, this study investigated information and information systems’ security within supply chains’ structures and processes. The study also investigated how information assurance objectives (i.e. confidentiality, integrity, availability, authentication and non-repudiation) can be achieved optimally within supply chains. Finally, the study proposes an information assurance model, which if adopted by decision makers, could enable them sustain their respective functions and processes within the supply chain network. In order to achieve the objectives of this study, the exploratory design and the case study approach were adopted in this study. The study also adopted the qualitative research method, and hence, semi-structured interviews were conducted, and served as the primary means of data collection. Participants in this study were drawn from two categories of organisations, which are supply chain and logistics organisations, and Information Technology (IT) consulting organisations. Therefore, the purposive sampling method was adopted in this study. An inductive approach was adopted in the analysis of data, and as a result, thematic analysis was adopted as the analysis method. The main outcome of the study is the proposed information assurance model that can enable decision makers sustain their respective functions and processes within the supply chain network