Supply chain design and analysis

Supply chain design and analysis

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  Supply Chain Designand Analysis: Models and Methods Dec-2019 Mohammad hossein sharifi
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  • Recently, however,there has been increasing attention placed on the performance, design, and analysis of the supply chain as a whole. • This attention is largely a result of the rising costs of manufacturing, the shrinking resources of manufacturing bases, shortened product life cycles, the leveling of the playing field within manufacturing, and the globalization of market economies. The objectives of this paper are to: • (1) provide a focused review of literature in multi-stage supply chain modeling and • (2) define a research agenda for future research in this area
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  The Supply ChainDefined • A supply chain may be defined as an integrated process wherein a number of various business entities (i.e., suppliers, manufacturers, distributors, and retailers) work together in an effort to: • (1) acquire raw materials, • (2) convert these raw materials into specified final products • (3) deliver these final products to retailers
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  highest level supplychain • In highest level ,a supply chain is comprised of two basic, integrated processes: • the Production Planning and Inventory Control Process • the Distribution and Logistics Process
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  The Supply ChainProcess
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  The Production Planningand Inventory Control • The Production Planning and Inventory Control Process encompasses the manufacturing and storage sub-processes, and their interface(s)
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  production planning • productionplanning describes the design and management of the entire manufacturing process (including raw material scheduling and acquisition, manufacturing process design and scheduling, and material handling design and control)
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  Inventory control • Inventorycontrol describes the design and management of the storage policies and procedures for raw materials, work-in-process inventories, and usually, final products
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  Distribution and LogisticsProcess • The Distribution and Logistics Process determines how products are retrieved and transported from the warehouse to retailers. • These products may be transported to retailers directly, or may first be moved to distribution facilities, which, in turn, transport products to retailers. This process includes the management of inventory retrieval, transportation, and final product delivery
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  multi-stage models • deterministicanalytical models, in which the variables are known and specified • stochastic analytical models, where at least one of the variables is unknown, and is assumed to follow a particular probability distribution • economic models • simulation models.
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  Deterministic Analytical Models •Williams (1981) presents seven heuristic algorithms for scheduling production and distribution operations in an assembly supply chain network (i.e., each station has at most one immediate successor, but any number of immediate predecessors). The objective of each heuristic is to determine a minimum-cost production and/or product distribution schedule that satisfies final product demand. The total cost is a sum of average inventory holding and fixed (ordering, delivery, or set-up) costs. Finally, the performance of each heuristic is compared using a wide range of empirical experiments, and recommendations are made on the bases of solution quality and network structure.
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  Stochastic Analytical Models •Cohen and Lee (1988) develop a model for establishing a material requirements policy for all materials for every stage in the supply chain production system. In this work, the authors use four different cost-based sub-models (there is one stochastic sub-model for each production stage considered)
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  (1) Material Control •Establishes material ordering quantities, reorder intervals, and estimated response times for all supply chain facilities, given lead times, fill rates, bills of material, cost data, and production requirements.
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  (2) Production Control •Determines production lot sizes and lead times for each product, given material response times.
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  (3) Finished GoodsStockpile (Warehouse) • Determines the economic order size and quantity for each product, using cost data, fill rate objectives, production lead times, and demand data.
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  (4) Distribution • Establishesinventory ordering policies for each distribution facility, based on transportation time requirements, demand data, cost data, network data, and fill rate objectives.
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  Simulation Models • Towill(1991) and Towill, et. al. (1992) use simulation techniques to evaluate the effects of various supply chain strategies on demand amplification. The strategies are as follows : • (1) Eliminating the distribution echelon of the supply chain, by including the distribution function in the manufacturing echelon. • (2) Integrating the flow of information throughout the chain. • (3) Implementing a Just-In-Time (JIT) inventory policy to reduce time delays. (4) Improving the movement of intermediate products and materials by modifying the order quantity procedures. • (5) Modifying the parameters of the existing order quantity procedures.
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  Supply Chain PerformanceMeasures 1. Qualitative Performance Measures 2. Quantitative Performance Measures
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  Qualitative Performance Measures •Customer Satisfaction • Pre-Transaction Satisfaction • Transaction Satisfaction • Post-Transaction Satisfaction • Flexibility • Information and Material Flow Integration • Effective Risk Management • Supplier Performance
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  Quantitative Performance Measures •Measures Based on Cost: • Sales Maximization • Profit Maximization • Inventory Investment Minimization • Return on Investment Maximization • Measures Based on Customer Responsiveness: • Fill Rate Maximization • Product Lateness Minimization • Customer Response Time Minimization • Lead Time Minimization • Function Duplication Minimization
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  Quantitative Performance Measures(cont) •Performance Measures Used in Supply Chain Modeling:
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  Decision Variables inSupply Chain Modeling • Production/Distribution Scheduling • Inventory Levels • Number of Stages (Echelons) • Distribution Center (DC) • Plant - Product Assignment • Buyer - Supplier Relationships • Product Differentiation Step Specification • Number of Product Types Held in Inventory
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  reference • Supply ChainDesign and Analysis: Models and Methods(Benita M. Beamon )