NDLI: Supply chain scheduling: Just-in-time environment

Content Provider	Springer Nature Link
Author	Maj, U. V. Gupta, Jatinder N. D Gupta, Sushil K. Sriskandarajah, Chelliah
Copyright Year	2007
Abstract	We study the benefits of coordinated decision making in a supply chain consisting of a manufacturer, a distributor, and several retailers. The distributor bundles finished goods produced by the manufacturer and delivers them to the retailers to meet their demands. The distributor is responsible for managing finished goods inventory. An optimal production schedule of the manufacturer, if imposed on the distributor, may result in an increased inventory holding cost for the distributor. On the other hand, an optimal distribution schedule of the distributor, if imposed on the manufacturer, may result in an increased production cost for the manufacturer. In this paper we develop mathematical models for individual optimization goals of the two partners and compare the results of these models with the results obtained for a joint optimization model at the system level. We investigate the computational complexities of these scheduling problems. The experimental results indicate that substantial cost savings can be achieved at the system level by joint optimization. We also study conflict and cooperation issues in the supply chain. The cost of conflict of a supply chain partner is a measure of the amount by which the unconstrained optimal cost increases when a decision is to be made under the scheduling constraint imposed by the other partner. We quantify these conflicts and show that the cost of conflicts are significant. We also show that a cooperative decision will generate a positive surplus in the system which can be shared by the two partners to make cooperation and coordination strategy more attractive.
Starting Page	53
Ending Page	86
Page Count	34
File Format	PDF
ISSN	02545330
Journal	Annals of Operations Research
Volume Number	161
Issue Number	1
e-ISSN	15729338
Language	English
Publisher	Springer US
Publisher Date	2007-12-01
Publisher Place	Boston
Access Restriction	One Nation One Subscription (ONOS)
Subject Keyword	Supply chain scheduling Production and distribution system Cooperation in decision making Conflict Theory of Computation Combinatorics Operations Research/Decision Theory
Content Type	Text
Resource Type	Article
Subject	Management Science and Operations Research

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