Integrated product design,shelf-space allocation and transportation decisions in green supply chains

In this paper, we examine a supply chain consisting of a manufacturer and retailer where the manufacturer undertakes greening efforts in terms of pack-size reduction and transportation cost reduction. The retailer decides on shelf-space allocation for the product. Both the players benefit from the greening efforts of the manufacturer. In such a setting, we examine strategic decisions of the players and compare and contrast the performance of the decentralised supply chain with the centralised supply chain. We also examine the effect of collaborative mechanisms by modelling two contracts in which the retailer offers a transportation cost reduction effort based contract and a two-part tariff contract. We find that the decentralised supply chain leads to lower greening efforts and shelf-space allocation decisions. We also find that the contracts improve pack-size reduction effort, transportation cost reduction effort and shelf-space allocation, while also improving the profitability of individual players. The findings demonstrate a scope for supply chain collaboration between manufacturer–retailer pairs in this setting. The paper uniquely combines three critical elements in supply chains, namely, product design, transportation and retailing decisions, and aims to provide insights into the decision making of players considering environmental waste and pollution. The paper also reflects consumer behavior and trade-offs that the supply chain players face.     

Effect of firm characteristics,supplier relationships and techniques used on Supply Chain Risk Management (SCRM): an empirical investigation on French industrial firms

Recent years have witnessed a focus on managing risks in supply chains. On the one hand, there are many cases where events like natural disasters, strikes and terrorism have significantly influenced the performance of organisational supply chains and in turn their competitiveness. And on the other hand, operational activities and strategic decisions of the firms (concerning, for e.g. supply, procurement, production, delivery, commercialisation, demand management, planning, etc.) can be different than expected and so create uncertainties. Uncertainties, whether they are external or internal, impact organisations leading to increased supply chain risk. Realising the potential implications of these situations on supply chain competitiveness, an attempt has been made to define risks and their sources and to identify the management that can help reduce the negative impact of risks on supply chains. In this paper, a framework for supply chain risk management (SCRM) is proposed and is applied using the data collected from 164 French companies, in manufacturing sector. The literature review, theoretical framework and empirical research undertaken in this work have led to identifying critical success management for SCRM. The focus of this paper is the inter-organisational management of supply chain risk: the collaborative relationship (with industrial and supply partners) can be considered as an efficient way to make SCRM. The paper finishes with a summary of the findings and conclusions, along with suggestions for future research projects.     

Agile supply chain strategy and supply chain performance: complementary roles of supply chain practices and information systems capability for agility

The paper examines the mediating effect of supply chain (SC) practices on the relationship between agile supply chain (ASC) strategy and SC performance. It further examines the moderating effect of information systems (IS) capability for agility on this mediated relationship. Using the theoretical lenses of complementarity and the information processing view of the supply chain, we hypothesise that strategic supplier partnership, customer relationship, postponement and lean practices, mediate the relationship between ASC strategy and SC performance. We further hypothesise that IS capability for agility moderates each of these mediated relationships. We empirically test the hypotheses using survey data from members of senior and executive management in the logistics/supply chain functions of 205 firms. The paper contributes to the literature on ASCs by theoretically explaining and empirically demonstrating how SC practices and IS capability for agility act together to effect a positive relationship between ASC strategy and supply chain performance.     

Supply chain focus dependent sensitivity of the point of product differentiation

Customer preferences for variety in the product(s) with improved customer service and lower prices are forcing the supply chains to overhaul the current practices from design to operational level. Postponement or delayed differentiation of the products is one such strategy, primarily deployed in mass customisation settings. Life cycles are shrinking not only for individual products but for product families as well. In this context, supply chain responsiveness becomes one of the crucial factors that need to be effectively managed to succeed in the present day competitive markets. Our model, that considers inventory costs and the supply chain responsiveness costs would aid a supply chain manager to make informed decisions with regard to the ideal location for the point of differentiation (POD), while striking the right balance between holding costs and the supply chain responsiveness costs. We also make use of a dimensionless parameter called the ‘coefficient of inverse responsiveness’ that not only facilitates the introduction of responsiveness related costs into the model but also improves the scalability and simplifies the analysis and interpretation of the results. Based on the strategic model developed, we offer some context-specific counter-intuitive managerial insights with respect to the sensitivity of the location of the POD in a supply chain.     

Supply chain optimisation with assembly line balancing

Supply chain management operates at three levels, strategic, tactical and operational. While the strategic approach generally pertains to the optimisation of network resources such as designing networks, location and determination of the number of facilities, etc., tactical decisions deal with the mid-term, including production levels at all plants, assembly policy, inventory levels and lot sizes, and operational decisions are related to how to make the tactical decisions happen in the short term, such as production planning and scheduling. This paper mainly discusses and explores how to realise the optimisation of strategic and tactical decisions together in the supply chain. Thus, a supply chain network (SCN) design problem is considered as a strategic decision and the assembly line balancing problem is handled as a tactical decision. The aim of this study is to optimise and design the SCN, including manufacturers, assemblers and customers, that minimises the transportation costs for determined periods while balancing the assembly lines in assemblers, which minimises the total fixed costs of stations, simultaneously. A nonlinear mixed-integer model is developed to minimise the total costs and the number of assembly stations while minimising the total fixed costs. For illustrative purposes, a numerical example is given, the results and the scenarios that are obtained under various conditions are discussed, and a sensitivity analysis is performed based on performance measures of the system, such as total cost, number of stations, cycle times and distribution amounts.     

A paler shade of green: implications of green product deletion on supply chains

Product management activities by operations, marketing, and finance functions have typically focused on the innovation, acquisition, growth, and management of product lines and products. The same is true when considering product management for green products. The latter stages of critical strategic decisions related to product deletion or discontinuation have received less emphasis. In this conceptual paper, the focus is on green product deletion implications for supply chain management and operations. Organisations may view green product deletion as evolving from a deep green to a paler shade of green in their product offerings. A proposed strategic framework pays particular attention to the implications of the green product deletion decision for supply chain processes and operational competencies. In this situation, lessened organisational greenness needs to be weighed against other organisational and operational competencies. The strategic and inter-organisational relationships associated with this decision help set the stage for future research on this critical, yet neglected, organisational and operational supply chain issue.     

Location-inventory problem in supply chains: a modelling review

A location-inventory problem (LIP) aims to integrate strategic supply chain design decisions with tactical and operational inventory management decisions. This study provides an extensive review of the existing literature of LIP modelling. A mathematical model is presented for a basic LIP, which can be further developed to incorporate additional features for use in real-world scenarios. We also discuss the evolution of LIP modelling literature over the past three decades and provide summary tables outlining characteristics of the published works including key modelling attributes and objective function cost components. Additional classifications are completed based on the solution methods adopted and real-world applications investigated. Our observations provide important insights and identify potential directions for future research in the field.     

Network positioning and risk perception in servitization: evidence from the UK road transport industry

For manufacturing firms, the integration of advanced services into their customer offerings has become a crucial decision. Such commercial decisions require weighting the risks and rewards of implementing a business model based on advanced services. While academic experts acknowledge uncertainty of returns on investment despite potential advantages, research generally fails to address the challenge of calculating the actual risks involved in ‘servitization’. This paper seeks better understanding of managers’ risk perception and of servitization implications for strategic partnerships and network positioning, while considering the impact of factors such as entry barriers, technological knowledge and position in the supply chain (SC). Qualitative evidence is drawn from an industrial case study involving firms in the UK’s road transport industry: 14 in-depth interviews with senior executives from seven companies (manufacturers, operators, technology providers). During interviews, a payment card exercise measured risk perception and willingness to take strategic ‘make-or-buy’ decisions. Results suggest that implementing advanced services is perceived as a high-risk strategy, especially when firms lack in-house technological knowledge. However, collaborative strategic partnerships within supply chain networks can mitigate this risk and prove crucial to building entry barriers against external competitors. Based on these findings, implications for network positioning are developed.     

An adaptive framework for aligning (re)planning decisions on supply chain strategy,design, tactics,and operations

Over the last decade, a wealth of valuable approaches to supply chain strategic, tactical, and operational planning has been extensively developed. However, conventionally the planning decisions at each of these levels have been considered in isolation from the other levels. Moreover, decisions on supply chain strategy, design, tactics, and operations are interlinked and dispersed over different supply chain structures (functional, organisational, informational, financial, etc.). This study develops a framework to increase the efficiency, consistency, implacability, and sustainability of decisions on how to design, plan, and run supply chains. In this paper it is proposed that comprehensive planning as an adaptive process encapsulates the planning decisions to be interrelated at all the decision-making levels. A conceptual model is described interlinking the supply chain strategy, design, planning, and operations on adaptation principles. Subsequently, a mathematical modelling complex and its realisation in a software environment is presented. This study contributes to developing methodical basics and practical tools to transit from simple open time slots incremental planning to dynamic, feedback-based adaptive supply chain planning. The elaborated framework serves to increase the efficiency, consistency, implacability, and sustainability of decisions on supply chain strategy, design, tactics, and operations. Decisions alignment can help to increase the wealth of organisations by producing demand-corresponding products in the most cost-effective manner through increasing agility, responsiveness, reaction speed to market changes, and continuous comprehensive improvements/adaptation of supply chains.     

Integrated supply chain risk management via operational methods and financial instruments

Supply chain risk management (SCRM) is an emerging field that generally lacks integrative approaches across different disciplines. This study contributes to narrowing this gap by developing an integrated approach to SCRM using operational methods and financial instruments. We study a supply chain composed of an aluminium can supplier, a brewery and a distributor. The supply chain is exposed to aluminium price fluctuation and beer demand uncertainty. A stochastic optimisation model is developed for managing operational and financial risks along the supply chain. Using this model as a base, we compare the performance of an integrated risk management model (under which operational and financial risk management decisions are made simultaneously) to a sequential model (under which the financial risk management decisions are made after the operational risk management decisions are finalised). Through simulation-based optimisation and using experimental designs and statistical analyses, we analyse the performance of the two models in minimising the expected total opportunity cost of the supply chain. We examine the supply chain performance as a function of three factors, each at three levels: risk aversion, demand variability and aluminium price volatility. We find that the integrated model outperforms the sequential model in most but not in all cases. Furthermore, while the results indicate that the supply chain improves its performance by being less risk averse, there exists a threshold beyond which accepting a higher risk level is not justified. Managerial insights are provided for various business scenarios experimented with.     

Supply chain risk classification: discussion and proposal

The supply chain management philosophy has often been used by organisations to achieve a competitive advantage, but it increases the vulnerability of these supply chains (SC) to certain risks. This dialogue between competitive advantage and risk generation has increased the number of studies related to the topic of ‘supply chain risk management’. Aiming to contribute to this field of research, a literature survey was conducted on 16 risk classifications, which included 56 risk types. These risk types were sorted according to existing conceptual similarities and then related to the five management processes intrinsic in a functional SC (plan, source, make, deliver and return), which are mainly advocated by the supply chain operations reference model. This literature review also highlights the lack of consensus among the surveyed authors concerning the risk types that affect a SC, a gap which this paper seeks to close by proposing a supply chain risk classification.     

Optimal pricing strategy for the perishable food supply chain

This research investigates the optimal pricing strategy for the perishable food supply chain. Using the setting of a two-echelon supply chain including a supplier and a retailer, we apply the game theory approach to derive the equilibriums for both a single pricing strategy and a two-stage pricing strategy. Through a comparison of the equilibriums, we explore how the two pricing strategies affect the supply chain’s decisions and supplier’s and retailer’s performance individually and collectively. The results of the analysis show that the optimal choice of pricing strategy depends on the price markdown cost and its relationship with the two critical thresholds that are determined by a combination of factors including the potential market size, the price and quality sensitivity factors, the initial quality, the unit product cost, and the quality deterioration rate.     

Supplier selection under risk of delivery failure: a decision-support model considering managers’ risk sensitivity

This paper studies the problem of supplier selection and order allocation in a retail supply chain (comprising suppliers, a central purchasing unit and outlets) under disruption risk. The final demand is deterministic. Suppliers are located in different geographic areas, and supplies are subject to a positive probability of disruption. Different capacity and failure probabilities for each supplier are considered. Our analysis focuses on the insurance versus profitability trade-off faced by a supply manager who buys from suppliers for the outlets. Instead of determining optimal decisions given an objective function and the risk sensitivity of the decision-maker, we use a mixed integer linear programming approach to provide decision-making support that shows a supply manager the ‘elasticity of (expected) losses versus (expected) profits’. Under this model, and depending on the profit-and-loss targets, a supply manager of known risk sensitivity (i.e. risk aversion and loss aversion) can make better decisions when choosing suppliers. Moreover, taking into account, the impact of the share of fixed costs that must be covered by the operation, we consider the net values of expected profit and loss. We discuss the potential influence of the level of the firm’s fixed costs on the supply strategy. In particular, we show how the minimum value of the gross margin needed for the strategy’s profitability affects that strategy. A numerical application is conducted to illustrate the contribution of our decision-making support mechanism, and several managerial insights are obtained.     

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).     

Performance measures and metrics in logistics and supply chain management: a review of recent literature (1995–2004) for research and applications

Performance measures and metrics are essential for effectively managing logistics operations, particularly in a competitive global economy. The global economy is featured with global operations, outsourcing and supply chain and e-commerce. The real challenge for managers of this new enterprise environment is to develop suitable performance measures and metrics to make right decisions that would contribute to an improved organizational competitiveness. Now the question is whether traditional performance measures can be used and out of them which ones should be given priority for measuring the performance in a new enterprise environment. Some of the traditional measures and metrics may not be suitable for the new environment wherein many activities are not easily identifiable. Measuring intangibles and nonfinancial performance measures pose the greater challenge in the so-called knowledge economy. Nevertheless, measuring them is so critical for the successful operations of companies in this environment. Considering the importance of nonfinancial measures and intangibles, an attempt has been made in this paper to determine the key performance measures and metrics in supply chain and logistics operations. This is based on a literature survey and some of the reported case experiences. Suggestions for future research directions are also indicated.     

Understanding supply chain management: critical research and a theoretical framework

Increasing global cooperation, vertical disintegration and a focus on core activities have led to the notion that firms are links in a networked supply chain. This strategic viewpoint has created the challenge of coordinating effectively the entire supply chain, from upstream to downstream activities. While supply chains have existed ever since businesses have been organized to bring products and services to customers, the notion of their competitive advantage, and consequently supply chain management (SCM), is a relatively recent thinking in management literature. Although research interests in and the importance of SCM are growing, scholarly materials remain scattered and disjointed, and no research has been directed towards a systematic identification of the core initiatives and constructs involved in SCM. Thus, the purpose of this study is to develop a research framework that improves understanding of SCM and stimulates and facilitates researchers to undertake both theoretical and empirical investigation on the critical constructs of SCM, and the exploration of their impacts on supply chain performance. To this end, we analyse over 400 articles and synthesize the large, fragmented body of work dispersed across many disciplines such as purchasing and supply, logistics and transportation, marketing, organizational dynamics, information management, strategic management, and operations management literature.     

Supply chain risk and resilience: theory building through structured experiments and simulation

The research literature of supply chain risk and resilience is at a critical developmental stage. Studies have established the importance of these topics both to researchers and practitioners. They also have identified factors contributing to risk, the impact of risk and disruptions on performance, and the strategies and tactics used to build the capacity for supply chain resilience. Although these efforts can provide support for constructing a theory of risk and resilience, researchers are currently restricted in their ability to build such a theory by the difficulty of collecting the necessary data. This paper contributes to this literature development effort by summarising prior research reviews and developing a three-component framework aimed at helping researchers to build better theories. This is accomplished through combining structured experimental design with discrete-event simulations of supply chains. The result is a methodology that allows researchers to develop better understanding of the factors that link a disruption to its impact on supply chain performance through both direct and interaction effects. Following the methodology development, the paper concludes with an example using the factors of shock interarrival time, supply chain connectivity and buffer stocks to illustrate the potential for contributing to the theory-building process.     

Performance measurement of cross-culture supply chain partnership: a case study in the Chinese automotive industry

This study explores a performance measurement system for a dynamic supply chain partnership in a cross-cultural context. An initial framework is constructed by reviewing the existing literature, followed by an in-depth case study in the Chinese automotive industry, where the framework is refined to address the multi-cultural setting. A performance measurement, system which includes the relationship strategy and operational measurement criteria for a supply chain partnership, has been developed. The relationship strategy contains elements of strategy orientation, management style, interdependence, mutual organisational characteristics and common goals. The operational measurement criteria consist of commitment, trust, communication behaviour, information sharing, participation decision, quality, production performance, delivery, cost, supplier strength, attitude, compromise and loyalty. The last three operational measurement criteria are found to be particularly relevant to the cross-cultural feature. While existing studies tend to focus on either specific measures or individual organisations, this paper for the first time proposes a comprehensive framework to measure the performance of supply chain partnerships. The cross-cultural perspective provides a further unique view on how a performance measurement system can be responsive to the dynamics in practice.     

潜在市场需求不确定下的风险厌恶供应链决策

考虑新产品投入市场时潜在市场需求不确定下的供应链风险厌恶,构造了一个考虑制造商和零售商的效用函数,建立了基于广告费用、服务水平以及销售价格的最优短期决策模型,分析了需求风险和供应链成员风险容忍水平对供应链最优短期决策的影响,采用数值仿真分析了供应链最优长期决策。研究结果表明：最优广告费用分别是需求风险和风险容忍水平的单调递增和递减函数,最优销售价格和服务水平则因行业等因素不同与需求风险和风险容忍水平呈U型或倒U型关系;当市场环境变化时,销售价格和服务水平在不同市场条件下应做出不同调整,而广告费用调整与市场特征无关;从长期来看制造商可以达到效用最大化,而零售商效用只能次优。a     

Supply chain risk mitigation competency: an individual-level knowledge-based perspective

Supply chain managers are responsible for making decisions regarding supply chain risk in order to mitigate the impact of supply chain disruptions. This study develops and tests a theoretical model that leverages the individual-level knowledge-based view perspective to understand the process through which risk mitigation orientation of the supply chain manager contributes to his/her absorptive capacity. A supply chain manager’s absorptive capacity, in turn, enhances his/her ability to effectively mitigate supply chain risk. Study findings demonstrate that supply chain managers with high-risk mitigation orientation have greater level of absorptive capacity which enhances their risk mitigation competency. This study represents the first development and testing of a model that examines individual-level knowledge management factors that affect supply chain risk mitigation competency. This research emphasises the importance of the individual supply chain manager in managing risk and illustrates how theoretical perspectives from the knowledge management, supply chain risk and organisational behaviour literature can be fruitfully adopted to explain behaviour in the field of supply chain risk management.