Consistent and Sustainable Supplier Evaluation and Order Allocation: Evaluation Score based Model and Multiple Objective Linear Programming Model

This paper is to develop an integrated approach of supplier evaluation and order allocation to suppliers that suggests the buyer to place more orders to the supplier that has higher evaluation score (consistent order allocation) considering sustainability issues including economic, social, environmental, and disruption of supply chain issues. The proposed approach is handled by an Evaluation Score based Linear Programming (ESLP) Model. Performances of ESLP model is compared with those of Multiple Objective Linear Programming (MOLP) model that does not explicitly consider the evaluation scores of suppliers for order allocation. Experimental results show that ESLP model offers consistent order allocation while MOLP model offers inconsistent order allocation. Moreover, MOLP model has different priorities of suppliers for order allocation when the customer demands are changed. Inconsistent order allocation makes the purchasing process nontransparent, unexplainable, and susceptible for biased decisions. ESLP and MOLP models generate compromised solutions that are nondominated. They are better and worse for some performances. This paper emphasizes a need of further research that develops consistent order allocation methods

New Sustainable Approach for Multi-Objective Production and Distribution Planning in Supply Chain

The paper aims to introduce a sustainable approach for aggregate production and distribution planning in a supply chain (APDP-SC) that considers multiple objectives and fuzzy parameters. The proposed approach addresses sustainability concerns, including maximizing total profit and total sales of the entire supply chain, balancing profit satisfaction between supply chain members, minimizing CO2 emissions from raw materials, production processes, and transportation of goods in the supply chain, and maximizing goodwill score from corporate social responsibility (CSR) activities. To determine the compromised solution, this paper develops a fuzzy multiple objectives mixed integer linear programming (FMOLP) model and a de-fuzzified model. The results of a simplified real case demonstrate that the proposed approach and model effectively determine the compromised solution and outperform comparison models that lack important features. Notably, this manuscript is the first to integrate the decision on conducting CSR activities with the APDP-SC decisions

Performance Comparison of Two-phase LP-based Heuristic Methods for Capacitated Vehicle Routing Problem with Three Objectives

This paper develops a two-phase LP-based heuristic for the Capacitated Vehicle Routing Problem (CVRP). It considers three objectives: (1) minimizing the total costs of fuel consumption and overtime, (2) maximizing the total personal relationships between customers and drivers, and (3) balancing the delivery weights of vehicles. The two-phase LP-based heuristic (cluster-first route-second) is proposed. First, in the clustering stage, three LP-based clustering models (denoted by C1, C2, and C3) are developed. Customers are grouped into clusters based on real distances between the customers for C1, personal relationships between the customers and drivers for C2, and the delivery weights of vehicles for C3. Second, in the routing stage, an LP-based traveling salesman problem model is used to form a route for each cluster, to minimize the total costs of fuel consumption and overtime labor. The experimental results from a case study of Thai SMEs show that when the C2 clustering model is applied, the performances are the best. Significant contributions of this paper include: (1) it is an original paper that proposes the C2 clustering model, and it has the best performances based on the experimental results, and (2) the proposed two-phase LP-based heuristic methods are suitable for practical use by SMEs since the required computational time is short, and it has multiple models with different objectives that can be selected to match a user's requirements

Vendor Managed Inventory for Multi-Vendor Single-Manufacturer Supply Chain: A Case Study of Instant Noodle Industry

This paper develops a vendor-managed inventory (VMI) model for a multiple-vendor, single-manufacturer supply chain, in which the first stage members can be traders and/or producers and the second stage member is a manufacturer. The model utilizes a realistic transportation cost which is dependent on the sizes (small- or medium-sized) of trucks. It can determine suitable sizes and numbers of trucks that minimize the transportation cost. A genetic algorithm (GA) technique, implemented in MATLAB software, is used to determine the best solution to the problem. A case study in the instant noodle industry is conducted to demonstrate the usefulness of the proposed model. Based on the experimental results, the VMI model has reasonable behaviors using sensitivity analysis. To reduce the inventory level of raw materials, the penalty cost may be set at a relatively high level or the upper inventory limits may be set at relatively low levels, without significantly affecting the average total cost per period of the entire supply chain. When the vendors are allowed to make decision independently, the solution is still the same as the solution from the proposed VMI model, which means that the manufacture does not take advantage of the vendors

Evaluation of SCOR KPIs using a predictive MILP model under fuzzy parameters.

The Supply Chain Operations Reference (SCOR) model is a well-recognized process reference model in the supply chain management field. Based on the literature, there is no research work that proposes a method to estimate and predict SCOR key performance indicators (KPIs) of a company. The objective of this paper is to propose a methodology to assess the SCOR KPIs under uncertainties based on level 2 of the SCOR-Make process metric, including nine KPIs. The proposed methodology consists of predictive MILP models with fuzzy parameters and some algorithms to assess the KPIs related to agility. A case study of a bottled-water factory is conducted to demonstrate the application of the proposed methodology. From the fact that some parameters are fuzzy numbers, the obtained SCOR KPIs are fuzzy numbers, which provide more information than constant values. The findings indicate that the proposed methodology is capable of developing the relationship between the manufacturing parameters and the SCOR KPIs, which enable the effective prediction process especially when the manufacturing parameters are changed or improved

Inventory/distribution control system in a one-warehouse/multi-retailer supply chain

This paper proposes a new inventory control system called the inventory/distribution plan (IDP) control system for a one-warehouse/multi-retailer supply chain. In the IDP control system, a proposed mixed-integer linear programming model is solved to determine an optimal IDP that controls the inventories of the supply chain. The efficiency of the IDP control system is compared to that of the echelon-stock R,s,S control policy, where R is a periodic review interval, s is a reorder point, and S is an order-up-to level, at various fill rates. The experimental results show that when the system faces non-stationary demands, the IDP control system significantly outperforms the echelon-stock R,s,S control system because it can give lower total costs for all ranges of fill rates.

AGGREGATE PRODUCTION PLANNING WITH FUZZY DEMAND AND VARIABLE SYSTEM CAPACITY BASED ON TOC MEASURES

Aggregate Production Planning (APP) model with fuzzy demand and variable system capacity is proposed in this research for a practical APP problem. A conventional APP problem assumes crisp market demands and also limited capacity by fixed hardware. In the proposed model, the difficulty in estimation crisp demands is relaxed by using fuzzy demand which also increases the flexibility of estimation and obtains the better production plan that can increase profit. The new approach to handle the fuzzy demand by integrating the possibility level of demand is proposed. Moreover, the limitation of system capacity is resolved by allowing additional investment in small machines and equipment. This investment can increase the necessary production capacity and eliminate the bottleneck of the system.  Three performance measures, based on the Theory of Constraints (TOC) concept, which are currently used in many organizations, are used to evaluate performance of the model. It is found that the proposed model can generate higher performance than conventional APP models