A measure of the bullwhip effect in supply chains with stochastic lead time

In this paper, we exactly quantify the bullwhip effect, the variance amplification in replenishment orders, for cases of stochastic demand and stochastic lead time in a simple two-stage supply chain with one supplier and one retailer. In most of the previous research, the impact of order lead time on the bullwhip effect in supply chains with pre-specified demand processes is investigated mostly for cases of deterministic lead time. In this paper, we deal with a first-order autoregressive, AR(1), demand process and investigate the behavior of a measure for the bullwhip effect with respect to autoregressive coefficient and stochastic order lead time. Extension to a mixed first-order autoregressive-moving average, ARMA(1,1), demand process is also considered.     

Evaluating the value of information sharing in a supply chain using an ARIMA model

This paper considers a two-echelon supply chain, which contains one supplier and one retailer. It studies the quantification of the bullwhip effect and the value of information-sharing between the supplier and the retailer under an autoregressive integrated moving average (ARIMA) demand of (0, 1, q). The results show that with an increasing value of q, bullwhip effects will be more obvious, no matter whether there is information sharing or not. When there exists information sharing, the value of the bullwhip effect is greater than it is without information sharing. With an increasing value of q, the gap between the values of the bullwhip effect in the two cases will be larger.     

需求提前期分布对供应链牛鞭效应的影响分析

为研究需求提前期在节点企业之间的不同分布对供应链牛鞭效应的影响,构建了基于时间序列自适应过滤预测和指数平滑预测方法所得出的多节点企业供应链条件下牛鞭效应的一般数学模型,并据此模型从理论和实证两方面进行了说明,所得结论为企业通过合理计划需求提前期和实现供应链网络重构来减小供应链牛鞭效应提供了参考.     

Supply chain management program first- and second-order effects model: a new strategic tool

Utilisation of supply chain management (SCM) strategies have an implicit objective of gaining an advantage over one’s business arena partners, whether they be competition or supply chain partners; an SCM-derived competitive advantage. A literature review accentuated four bases of strategic competition (cost-based, resource-based, time-based and knowledge-based), upon which, such an SCM-derived competitive advantage might be built. A Monash University qualitative research study found that the majority of small- to medium-sized firms have found this to be a risky and unprofitable endeavour. In response, this paper explores the four bases of strategic competition through an exemplary success case found within the Australian textiles, clothing and footwear (TCF) industry. The research raised a proposition stated as “effective supply chain management increases shareholder value (SHV).” An effective SCM program influences key success drivers (e.g. expenses, asset utilisation and process cycle time) available to it in a manner that maximises the firm’s competitive position, given its chosen strategy. This paper presents a first- to second-order SCM effects matrix model as a small step towards the mainstream achievement of current world-wide best SCM practice. The matrix can be utilised by individuals planning supply chain change processes or teams evaluating potential change initiatives within their supply chain operations. The substructure of the matrix is examination by isolating just the time-based strategic key success drivers, as found in the literature. The matrix’s utilisation methodology is detailed to enable its application by practitioners.     

基于VMI策略的供应链最小费用研究

供应商管理库存(VM I)是一种新型的供应链库存管理模式。基于供应商管理库存策略,通过对供应商如何安排生产,以及在各周期向分销商提供多少供货量,才能使整个供应链的费用最小这一目标进行了研究,并采用微粒群算法给出算例求解。     

Analysis of inventory level under procurement constraints in supply chain

Because the inventory is one of the major factors that affect the performance of the supply chain system, efficient reduction of an inventory can effectively reduce the cost level of the total supply chain. Therefore, inventory management is an important means to optimize the operation of a supply chain and enhance the competitive advantage. Considering the (s, S) policy in an inventory management, this paper establishes a model of the inventory level. Then, the change of the inventory level with and without the procurement constraints is analyzed, and their expectation and variance calculated. Consequently, the order point can be determined accurately to reduce the inventory level and the operation risk. __________ Translated from Modern Manufacturing Engineering, 2006, (10): 1–3 [译自: 现代制造工程]     

弹性需求下带有分摊运费的供应链协调策略

研究了弹性需求条件下,由单一零售商和单一供应商组成的两级供应链的协调订货问题.该协调运用了共同补给期和分担运输费用的双重策略,分别从订货周期及年需求量的角度协调供应链订货.在Stackelberg博弈的框架下,首先从实际出发,引入了零售商最优转让折扣率,再从供应商的角度建立了协调模型,然后讨论了求解算法,并利用数值试验方法,通过仿真研究说明了该协调策略的有效性和可行性.     

How to synchronise the multi plant supply chain

The art of production scheduling is in balancing demand with capacity. Any SME or larger enterprise and its partners need to be synchronized, time aware, flexible and highly organised. This is where a scheduling software solution can prove to be an invaluable investment, and additionally, something that can deliver a rapid return on investment (ROI). With demand, capacity and supply chain flow, a finite capacity scheduling (FCS) or advanced planning and scheduling (APS) package can ensure each supplier, customer and internal department has the appropriate information to hand in transparent, up to the minute form. Many companies fail to consider the availability of capacity as a key factor in determining delivery, which can be even more complex when multiple plants/facilities are part of the supply chain. In this paper, the author discusses the importance of capacity in supply chain management.     

Simulating the performance of supply chain with various alliances

Many models of supply chain management (SCM) have been popularly developed in recent years. However, this study focuses on the supply chain (SC) performance with respect to various alliances among partners. First, this study explores the game theory for formulating the SCM problem as a multi-objective programming problem. Second, various alliances, e.g., union, extreme competition, and Stackelberg competition among partners will be considered in such a problem so as to compare the SC performance under different alliances. Third, a numerical example is illustrated by two material supplier partners, three manufacturing partners, two logistics partners, and three customers, where each partner in the SC has its own objective and constraints. This SC problem is resolved across three different time periods. Finally, study results show that the maximum global benefits can be obtained only when all partners form a single union, but the inefficient partners lose significantly in such a union. The minimal global benefits exist in the extreme competition.     

Integrated supply chain design using multi-criteria optimization

Supply chain management (SCM) presents significant opportunities for improving profit margins and reducing cost. It encompasses functional and geographical integration as well as integration of tactical and operational decisions. The functional integration aspects involve purchasing, manufacturing, and logistics within the company and across the supply chain. A supply chain design framework has been developed including linear/mixed integer multi-criteria optimization models for determining the identified supply chain design parameters. The selection of suppliers, determination of production quantities, inventory locations and sizes, selection of transportation method and transported quantities in a multi-stage, multi-level supply chain are investigated. Additional criteria including first-time quality (FTQ) and suppliers on-time delivery risk with and without allowing splitting of customer demand between suppliers are considered. An example of typical automotive power train supply chain design and decision issues is used to illustrate the effect of various factors.     

Multi-objective supply chain sourcing strategy design under risk using PSO and simulation

Sourcing strategy design in a supply chain is vital to gain competitive advantage. In recent years, supply chain risks are growing significantly and supplier failure is identified as one of the top supply chain risks. Researchers attempt to mitigate the negative impacts of supplier failure by applying strategies such as local versus global sourcing, single versus dual/multiple-sourcing, performance-based supply contracts, and optimizing the order allocation among suppliers. Global sourcing is a widely recognized strategy among firms, and it involves a trade-off between reliable, high-cost local suppliers and unreliable, low-cost offshore suppliers. The global sourcing is associated with the risks of exchange rate volatility, trade restrictions, longer lead time, and problems with supplier reliability. Sourcing strategy design considering price, exchange rate risks, and supplier delivery reliability is an important research topic and needs attention. In this work, a hybrid optimization and simulation approach is proposed to design the supply chain sourcing strategy. In the optimization approach, a multi-objective binary particle swarm algorithm is developed for minimizing the total cost and maximizing the supplier delivery reliability. Selected scenarios from the optimization results are modeled using Witness simulation software to evaluate the robustness of sourcing strategies under price, exchange rate and demand risks. The proposed approach is exemplified using a real-life case study of a plastic product manufacture in India.     

Ontology-based semantic models for supply chain management

The efficiencies of supply chain management (SCM) are often impaired by inconsistent exchange and sharing of knowledge semantics among supply chain partners. To address this problem with semantic integration, this paper presents an approach to developing ontologies of supply chain management (Onto-SCM) as a common semantic model of the SCM domain. The Onto-SCM semantic model is constructed in a modular way in order to enhance its reusability and maintainability. The IDEF5 schematic language is employed to provide the graphical representation of Onto-SCM for intuitive communication between domain experts and users. Furthermore, Ontolingua is adopted to define formal semantics of Onto-SCM for effective knowledge interoperability. In addition, a case study of a printer supply chain is illustrated to demonstrate the proposed approach to semantic integration for SCM. Finally, a prototype is developed to support visualized knowledge modeling of the case system using the IDEF5 schematic language and to implement consistent knowledge transformation among heterogeneous applications in the supply chain.     

Impact of forecasting methods on variance ratio in order-up-to level policy

This paper considers the impact of forecasting methods on the bullwhip effect for a simple replenishment system in which a first-order autoregressive process describes the customer demand and an order-up-to inventory policy characterizes the replenishment decision. The impact of exponential smoothing and minimum mean squared error forecasting is measured for both the bullwhip effect and inventory variances. Previous similar studies have focused on investigating the impact of forecasting methods on bullwhip effect. However, little research has been carried out to explore the impact of forecasting methods for both bullwhip effect and inventory variances. Through simulation experiments, it has been found that depending on the structure of the demand process, the appropriate selection of forecasting technique can reduce, or even eliminate (i.e., “dewhip”) the bullwhip effect. However, in terms of inventory variances it has been shown that the inventory variances for the exponential smoothing are greater than the minimum mean squared error forecasting method and that gap increases as lead time increases. These findings will help companies to choose the appropriate forecasting technique depending on the nature of demand. These guidelines can help companies to reduce the bullwhip effect and inventory variances across supply chain.     

无缺陷退货问题的建模与供应链协作

针对供应链中无质量缺陷的退货问题,建立了单个制造商和零售商构成的分散决策模型,模型中考虑了零售商宣传咨询对于顾客需求和退货率的影响.给出了该模型中零售商的最优订货策略和最优宣传咨询努力水平的上界.分析了零售商缺乏宣传咨询投入的原因,为实现无质量缺陷退货的供应链协作优化,提出了一种制造商承担部分宣传咨询投入成本的分担策略.数值仿真结果表明,恰当的分担比例可以同时提高制造商和零售商的收益,提高供应链绩效.     

Beyond lean [supply chain management]

Ever increasing competition, progressive internationalisation, acquisition and mergers, and the dawn of supply chain management (SCM) into the mainstream of industrial thinking has broadened the mindset of management to appreciate that one has to think business-wide in order to really define a plan that will drive operations forward. SCM has emerged to demonstrate an answer to the need to bring demand- and supply-side management to fruition. The author investigates supply chain management resources and techniques.     

Simulation modeling for comparative evaluation of supply chain management strategies

Supply chain management (SCM) has become one of the most important strategies for achieving competitive advantage in different industries in the last decade. Researchers have investigated various processes in the planning and development of supply chains. However, increasing attention has been placed on performance, design and analysis of supply chain models. A supply chain is a complex model that is very difficult to analyze, in particular, with respect to performance. Simulation is one of the effective tools to evaluate the control mechanism for a supply chain. In this paper, five common supply chain models have been built and tested with the aid of simulation. Various performance measures such as transportation cost, resources utilization, inventory level, and order cycle time will be calculated for comparative indications. The methodology that is presented in this paper can be extended to any real life applications in SCM.     

Hybrid approach to distribution planning reflecting a stochastic supply chain

Today’s business environment is experiencing as a period of expansion and the globalization. Therefore, a distribution plan with low cost and high customer satisfaction in supply chain management (SCM) has been widely investigated. The purpose of this study is to establish optimal distribution planning in the supply chain. In this paper, a hybrid approach involving a genetic algorithm (GA) and simulation is presented to solve this problem. The GA is employed in order to quickly generate feasible distribution sequences. Considering uncertain factors such as queuing, breakdowns and repairing time in the supply chain, the simulation is used to minimize completion time for the distribution plan. The computational results for an example of a simple supply chain are given and discussed to validate the proposed approach. We obtained a more realistic distribution plan with optimal completion time by performing the iterative hybrid GA simulation procedure which reflects the stochastic nature of supply chains.     

具有外包选择的闭环供应链切换模型及其鲁棒控制

建立了一类具有外包选择的闭环供应链切换系统模型,包括自行回收再制造和外包两个子系统,以及基于成本的切换信号向量。为了抑制闭环供应链系统在自行回收再制造和外包切换过程中产生的运作波动和牛鞭效应,应用鲁棒控制理论方法给出了供应链切换系统的控制律,分析了闭环供应链切换系统运作过程,并进行了控制律计算和系统仿真,验证了鲁棒控制律的有效性。     

供应链管理中工程数据库集成技术

信息技术的发展为制造系统供应链管理提供了有效支持,供应链上的节点均是 独立自主的过程实体。物理上分散,逻辑上也分散的分布式数据库管理系统存在数 据库构建困难及系统复用性、过程实体自治性差等缺点。本文提出物理上分散,逻辑 上集中的分布式数据库管理系统结构模型,并设计过程实体数据库与供应链全局工 程数据库集成的应用程序接口实现方案,解决了分布式供应链管理中工程数据库集 成的问题。     

A study of lead time variation impact on supply chain performance

Lead time (LT) is a core parameter that varies and affects all supply chain (SC) partners. LT uncertainty is known as a kind of supply uncertainty in the SC literature which attracts attention of many researchers. In this paper, impact of LT variability in a serially connected supply chain with 4 levels is investigated. The study includes two main stages: development of a structural model and testing the structural relations by using simulated data. Simulation makes it possible to remove effects of intervener variables in order to measure pure impact of LT uncertainty on SC. Regarding this matter, a structural relationship model with three hypotheses about direct and indirect impact of LT uncertainty on supply chain inventories have been developed. To test the proposed structural relations, simulated data were used. The results of the study show that by increasing the lead time variance, order variances increase while no impact on the bullwhip is observed, i.e. the order variances increase uniformly throughout the entire SC. Furthermore, results show that the increase in the lead time variance will lead to inventory fluctuations. One practical recommendation of this study is to apply an investment strategy to reduce the lead time uncertainty.