Supply chain collaboration

In the past, research in operations management focused on single-firm analysis. Its goal was to provide managers in practice with suitable tools to improve the performance of their firm by calculating optimal inventory quantities, among others. Nowadays, business decisions are dominated by the globalization of markets and increased competition among firms. Further, more and more products reach the customer through supply chains that are composed of independent firms. Following these trends, research in operations management has shifted its focus from single-firm analysis to multi-firm analysis, in particular to improving the efficiency and performance of supply chains under decentralized control. The main characteristics of such chains are that the firms in the chain are independent actors who try to optimize their individual objectives, and that the decisions taken by a firm do also affect the performance of the other parties in the supply chain. These interactions among firms’ decisions ask for alignment and coordination of actions. Therefore, game theory, the study of situations of cooperation or conflict among heterogenous actors, is very well suited to deal with these interactions. This has been recognized by researchers in the field, since there are an ever increasing number of papers that applies tools, methods and models from game theory to supply chain problems

On two-echelon inventory systems with Poisson demand and lost sales

We derive approximations for the service levels of two-echelon inventory systems with lost sales and Poisson demand. Our method is simple and accurate for a very broad range of problem instances, including cases with both high and low service levels. In contrast, existing methods only perform well for limited problem settings, or under restrictive assumptions.\u

Coordinated replenishment systems with discount opportunities

Inventory Control;Inventory Models;inkoop

Cooperation in Supply Chain Networks: Motives, Outcomes, and Barriers

This paper analyzes the phenomenon of cooperation in modern supply chains in the light of Game Theory. We first provide a discussion on the meaning of cooperation in supply chains, its motives, outcomes and barriers. We then highlighted the applicability of Cooperative Game Theory as methodology for analyzing cooperation in supply chains. Second, we review recent studies that analyze the cooperation in supply chains by means of cooperative game theory. A special emphasis will be given inventory centralizations games. Finally, gaps in the literature are identified to clarify and to suggest future research opportunities

On the determination of the control parameters of the optimal can-order policy

Inventory Control

Assessment of joint inventory replenishment: a cooperative games approach

This research deals with the design of a logistics strategy with a collaborative approach between non-competing companies, who through joint coordination of the replenishment of their inventories reduce their costs thanks to the exploitation of economies of scale. The collaboration scope includes sharing logistic resources with limited capacities; transport units, warehouses, and management processes. These elements conform a novel extension of the Joint Replenishment Problem (JRP) named the Schochastic Collaborative Joint replenishment Problem (S-CJRP). The introduction of this model helps to increase practical elements into the inventory replenishment problem and to assess to what extent collaboration in inventory replenishment and logistics resources sharing might reduce the inventory costs. Overall, results showed that the proposed model could be a viable alternative to reduce logistics costs and demonstrated how the model can be a financially preferred alternative than individual investments to leverage resources capacity expansions. Furthermore, for a practical instance, the work shows the potential of JRP models to help decision-makers to better understand the impacts of fleet renewal and inventory replenishment decisions over the cost and CO2 emissions.DoctoradoDoctor en Ingeniería Industria

A discrete time Markov chain model for a periodic inventory system with one-way substitution.

This paper studies the optimal design of an inventory system with “one-way substitution”, in which a high-quality (and hence, more expensive) item fulfills its own demand and simultaneously acts as backup safety stock for the (cheaper) low-quality item. Through the use of a discrete time Markov model we analyze the effect of one-way substitution in a periodic inventory system with an (R,s,S) or (R,S) order policy, assuming backorders, zero replenishment leadtime and correlated demand. In more detail, the optimal inventory control parameters (S and s) are determined in view of minimizing the expected total cost per period (i.e. sum of inventory holding costs, purchasing costs, backorder costs and adjustment costs). Numerical results show that the one-way substitution strategy can outperform both the “no pooling” (only product-specific stock is held, and demand can never be rerouted to stock of a different item) and “full pooling” strategies (implying that demand for a particular product type is always rerouted to the stock of the flexible product, and no product-specific stock is held) − provided the mix of dedicated and flexible inputs is chosen adequately − even when the cost premium for flexibility is significant. Furthermore, we can observe that decreasing the demand correlation results in rerouting more demand to the flexible product and because of the risk-pooling effect reduces the optimal expected total cost.Inventory management; One-way substitution;

E-Fulfillment and Multi-Channel Distribution – A Review

This review addresses the specific supply chain management issues of Internet fulfillment in a multi-channel environment. It provides a systematic overview of managerial planning tasks and reviews corresponding quantitative models. In this way, we aim to enhance the understanding of multi-channel e-fulfillment and to identify gaps between relevant managerial issues and academic literature, thereby indicating directions for future research. One of the recurrent patterns in today’s e-commerce operations is the combination of ‘bricks-and-clicks’, the integration of e-fulfillment into a portfolio of multiple alternative distribution channels. From a supply chain management perspective, multi-channel distribution provides opportunities for serving different customer segments, creating synergies, and exploiting economies of scale. However, in order to successfully exploit these opportunities companies need to master novel challenges. In particular, the design of a multi-channel distribution system requires a constant trade-off between process integration and separation across multiple channels. In addition, sales and operations decisions are ever more tightly intertwined as delivery and after-sales services are becoming key components of the product offering.Distribution;E-fulfillment;Literature Review;Online Retailing

Carbon emissions Inventory Games

Carbon emissions reduction has been the center of attention in many organizations during the past few decades. Many international entities developed rules and regulations to monitor and control carbon emissions especially under supply chain context. Furthermore, researchers investigated techniques and methods on how reduce carbon emissions under operational adjustment which can be done by cooperation or coordination. The main contribution of this thesis is to measure to what extend cooperation can contribute to carbon emissions. Many research addresses the advantage of cooperation in reducing cost. However, there isn't a plenty of research addressing the effect of cooperation on carbon emissions when the incentive of the cooperation is to reduce cost only. The aim of this thesis is to show if joint replenishment leads to a reduction in carbon emissions and this to be considered as an advantage to be added to cooperation. Moreover, if a savings occur from cooperation, the aim will be to address the issue of allocating the savings among parties engaged in the coalition. The thesis methodology adapted and extended cooperative EOQ model and basic inventory model (EOQ) in order to formulate and build an adjusted model to measure carbon emissions. The adjusted model will be used to calculate carbon emission in centralized and decentralized systems with incentives to reduce cost and no incentives to reduce emission. The calculation shall yield the optimum ordering quantity which in turn yields the savings between the two systems. Finally core allocation principles will be leveraged to propose a fair allocation of savings. Furthermore, the model will be extended to consider some regulation and different environments to which it will cater for carbon-tax regulation and full Truckload system contexts. Findings indicate that applying inventory game theory leads to a reduction of carbon emissions along with cost. Additionally, the total carbon emissions in centralized system will always be less then decentralized system under all conditions. Moreover, the proposed proportional allocation which was proven to be a core allocation model will be based on the frequency of ordering and the amount of holding emissions

Dampening variability by using smoothing replenishment rules.

A major cause of supply chain deficiencies is the bullwhip effect which can be substantial even over a single echelon. This effect refers to the tendency of the variance of the replenishment orders to increase as it moves up a supply chain. Supply chain managers experience this variance amplification in both inventory levels and replenishment orders. As a result, companies face shortages or bloated inventories, run-away transportation and warehousing costs and major production adjustment costs. In this article we analyse a major cause of the bullwhip effect and suggest a remedy. We focus on a smoothing replenishment rule that is able to reduce the bullwhip effect across a single echelon. In general, dampening variability in orders may have a negative impact on customer service due to inventory variance increases. We therefore quantify the variance of the net stock and compute the required safety stock as a function of the smoothing required. Our analysis shows that bullwhip can be satisfactorily managed without unduly increasing stock levels to maintain target fill rates.Bullwhip effect; Companies; Cost; Costs; Impact; Inventory; Managers; Order; Replenishment rule; Rules; Safety stock; Supply chain; Supply chain management; Variability; Variance; Variance reduction;