Coordinated Contract Decisions in a Make‐to‐Order Manufacturing Supply Chain: A Stochastic Programming Approach

One of the important objectives of supply chain S&OP (Sales and Operations Planning) is the profitable alignment of customer demand with supply chain capabilities through the coordinated planning of sales, production, distribution, and procurement. In the make‐to‐order manufacturing context considered in this paper, sales plans cover both contract and spot sales, and procurement plans require the selection of supplier contracts. S&OP decisions also involve the allocation of capacity to support sales plans. This article studies the coordinated contract selection and capacity allocation problem, in a three‐tier manufacturing supply chain, with the objective to maximize the manufacturer's profitability. Using a modeling approach based on stochastic programming with recourse, we show how these S&OP decisions can be made taking into account economic, market, supply, and system uncertainties. The research is based on a real business case in the Oriented Strand Board (OSB) industry. The computational results show that the proposed approach provides realistic and robust solutions. For the case considered, the planning method elaborated yields significant performance improvements over the solutions obtained from the mixed integer programming model previously suggested for S&OP.     

销售及运营计划（S＆OP）与企业各资源规划系统关系探微

21世纪的竞争是供应链之间的竞争。而销售及运营计划（S＆OP），一个先进、实用、成效显著的决策工具，能够为高层管理者构建随需而动的高效供应链。本文从企业目标层级，内部资源计划体系以及各职能部门的连接三方面着手探索了销售及运营计划（S＆OP）的运行机制。     

A Hierarchical Product Development Planning Framework

Uncertainty in new product development (NPD) planning embraces market, creative, technological, and process dimensions to a much greater extent than in non‐NPD project planning. Yet, NPD management is becoming increasingly decentralized, both within the firm and across the supply chain. Hence, planning for NPD uncertainty often results in path‐dependent scenarios cutting across the strategic, tactical, and operational levels of planning. To coordinate this resulting complexity, we propose a stochastic hierarchical product development planning framework with multiple recourses, i. e., corrective actions, to maximize performance across a firm's entire NPD program. We also argue the necessity for a fourth planning level, the infrastructural, that reestablishes norms for market projections, technological forecasts, scheduling, and requirements as latent uncertainty in the environment is continually revealed. An illustration from the automotive industry is presented to demonstrate a deployment of our framework. We additionally discuss the applicability of this framework for managing NPD capabilities over time.     

Supply chain configuration for diffusion of new products: An integrated optimization approach

We develop an integrated/hybrid optimization model for configuring new products’ supply chains while explicitly considering the impact of demand dynamics during new products’ diffusion. The hybrid model simultaneously determines optimal production/sales plan and supply chain configuration. The production and sales plan provides decisions on the optimal timing to launch a new product, as well as the production and sales quantity in each planning period. The supply chain configuration provides optimal selection of options and safety stock level kept at each supply chain function. Extensive computational experiments on randomly generated testbed problems indicate that the hybrid modeling and solution approach significantly outperforms non-hybrid alternative modeling and solution approaches under various diffusion and supply chain topologies. We provide insights on optimal production/sales plan and supply chain configuration for new products during their diffusion process. Also, managerial implications relevant to effectiveness of the hybrid approach are discussed.     

分布决策环境下生产-分销协同计划研究

针对分布决策环境下因信息不对称使得供应链协同计划求解困难及难以达到全局最优的问题,本文利用多层规划理论和方法构建一个供应链生产-分销协同计划模型,采用模糊交互式协商和遗传算法的优化求解方法对协同计划模型进行求解。该方法求解的结果是一组满足约束条件的满意解,各节点企业根据自身偏好和约束信息决定是否接受该满意解,或者修正各自目标满意度隶属函数重新求解。决策过程具有一定的柔性。最后通过算例给出供应链生产-分销协同计划满意解的求解过程,对文中所建立的模型和算法进行了有效地说明和验证。求解结果说明该模型和协商方法能够有效地解决非对称信息条件下供应链生产-分销协同计划的求解和冲突问题。     

Optimal Planning Quantities for Product Transition

The replacement of an existing product with a new one presents many challenges. In particular, uncertainties in a new product introduction often lead to extreme cases of demand and supply mismatches. This paper addresses inventory planning decisions for product upgrades when there is no replenishment opportunity during the transition period. We allow product substitution: when a company runs out of the old product, a customer may be offered the new product as a substitute. We show that the optimal substitution decision is a time‐varying threshold policy and establish the optimal planning policy. Further, we determine the optimal delay in a new product introduction, given the initial inventory of the old product.     

The Impact of Product Lifecycle on Capacity Planning of Closed‐Loop Supply Chains with Remanufacturing

Product recovery operations in reverse supply chains face rapidly changing demand due to the increasing number of product offerings with reduced lifecycles. Therefore, capacity planning becomes a strategic issue of major importance for the profitability of closed‐loop supply chains. This work studies a closed‐loop supply chain with remanufacturing and presents dynamic capacity planning policies developed through the methodology of System Dynamics. The key issue of the paper is how the lifecycles and return patterns of various products affect the optimal policies regarding expansion and contraction of collection and remanufacturing capacities. The model can be used to identify effective policies, to conduct various “what‐if” analyses, and to answer questions about the long‐term profitability of reverse supply chains with remanufacturing. The results of numerical examples with quite different lifecycle and return patterns show how the optimal collection expansion/contraction and remanufacturing contraction policies depend on the lifecycle type and the average usage time of the product, while the remanufacturing capacity expansion policy is not significantly affected by these factors. The results also show that the collection and remanufacturing capacity policies are insensitive to the total product demand. The insensitivity of the optimal policies to total demand is a particularly appealing feature of the proposed model, given the difficulty in obtaining accurate demand forecasts.     

基于补偿合约的供应链定价与能力设计的协调问题研究

研究和分析了在需求不确定并且受价格影响的情况下,供应链中制造商与供应商的产品定价与能力设计的协调问题。制造商从供应商处采购用于产品生产的关键零部件,供应链面临的潜在需求服从随机分布,有效需求则受产品定价的影响。当供应商的生产能力出现约束时,制造商可以从外部其他渠道获取关键零部件,但是需要付出一个更高的采购价格。制造商确定产品的销售价格,供应商确定生产能力。分析比较了在集成供应链与独立决策的供应链中的定价与能力计划策略,提出了一种能够有效协调制造商和供应商的决策行为的补偿合约。最后,进行了数值分析,证明补偿合约的有效性。     

Planning and Scheduling in Supply Chains: An Overview of Issues in Practice

This paper gives an overview of the theory and practice of planning and scheduling in supply chains. It first gives an overview of the various planning and scheduling models that have been studied in the literature, including lot sizing models and machine scheduling models. It subsequently categorizes the various industrial sectors in which planning and scheduling in the supply chains are important; these industries include continuous manufacturing as well as discrete manufacturing. We then describe how planning and scheduling models can be used in the design and the development of decision support systems for planning and scheduling in supply chains and discuss in detail the implementation of such a system at the Carlsberg A/S beerbrewer in Denmark. We conclude with a discussion on the current trends in the design and the implementation of planning and scheduling systems in practice.     

Building a short-term production planning system for flexible manufacturing systems: an integration viewpoint

From the viewpoint of integration, the production objective of flexible manufacturing systems (FMS) should follow results of MRP/CRP. Thus, the planning goal of short-term production planning (STPP) is to satisfy quantity and due date requirements determined by MRP/CRP. The STPP of FMS should cover part type selection, production ratio, process selection, process ratio, resource allocation, machine grouping, routing mix and loading problems.

A STPP system is built to solve the STPP problem of an FMS having multiple machine types, each with multiple m.'ichinc units. This system adopts a variable-period flexible planning approach, using part mix and process selection flexibilities to solve STPP problems. It also provides flexibilities in its operations sequence and in the machine routing to the dynamic operation planning system.     

基于新产品的供应链最优生产策略

商业竞争与技术进步导致产品生命周期的缩短,要求企业能不断地推出新产品。而新产品的生产与需求是一个逐步适应和熟悉的过程,具有明显的学习效应。本文运用Bass模型来描述新产品的需求扩散效应,建立了新产品供、产、销三级供应链的生产存储优化模型,并通过算例,计算机模拟出最优生产批量。该研究改进了传统的一般产品的生产存储计划,对面向市场需求的供应链的新产品投产具有重要的指导意义。     

The Reverse Supply Chain Planning Matrix: A Classification Scheme for Planning Problems in Reverse Logistics

This paper presents a conceptual planning framework for reverse supply chain operations based on an extensive literature review and industry expertise. Such a holistic scheme for classification of planning tasks is necessary as the intensification of research on reverse logistics and closed‐loop supply chains in recent years has raised a number of planning problems that differ from those of solely forward‐oriented supply chains. Up to now, a common and comprehensive definition of relevant planning problems along the reverse chain has not existed. Thus, a thorough understanding of the interdependence between these elements is missing. This paper aims to systematically identify planning problems, which are assigned to different planning horizons and distinct process stages of product recovery. The result is a classification scheme, called a ‘Reverse Supply Chain Planning Matrix’ (RSCPM), which categorizes planning problems and shows their interrelation in recovery operations. It serves both academia and practitioners as a holistic overview for planning and decision tasks. Moreover, decision‐makers are supported in identifying the relevant variables in reverse supply chains and in revealing the consequences of one decision regarding other parameters of the system. To the best of the authors' knowledge, the RSCPM is the first attempt to comprehensively structure the field of reverse supply chain research by identifying, defining and interconnecting planning problems within an integrated framework, as is common in the forward case.     

Linking R&D with the strategic management process of the firm

An examination of the problems associated with integrating R&D activities with the overall strategic planning process of the firm is presented. A model which links R&D to other functional activities as well as to strategic planning by a technical planning committee is proposed. The implementation of this integrative process requires organizational structural and communications adjustments.     

Managing uncertainty and ambiguity in frontier R&D projects: A Korean case study

One of the important tasks in planning large, frontier R&D projects is to minimize innate uncertainties and ambiguities in the early stages of the project. This case study is an attempt to provide a framework to handle such problems in R&D planning. In it we analyze various elements that define planning conditions, classify them into basic constructs, and suggest tools and methods to deal with uncertainty and ambiguity. We utilize two case studies to approach the research questions. Our findings suggest that both initial planning conditions and the effectiveness of front-end planning management affect the performance of R&D planning and the later R&D process.     

Sustainable planning strategies in supply chain systems: proposal and applications with a real case study in fashion

Abstract

Pollution generated by the fashion industry drives people to pay attention to fashion companies’ sustainability practice. This increase in attention has induced vast literature studying the related area. Since the fashion apparel supply chain is complicated which involves a lot of interrelated steps and decisions, how fashion companies can identify the demand in sustainable fashion and make the right decision in resource allocation throughout the supply chain becomes a critical issue. As a result, this paper examines how a fashion company can develop a successful sustainable planning strategy throughout the sustainable fashion supply chain. The sustainability attributes and the sustainable planning strategy mechanism are also discussed. Based on the institutional theory and resource-based theory, we first analyse the external pressure and internal motivations for companies to adopt a sustainable planning strategy in the fashion supply chain. We then identify the core stakeholders related to the sustainable planning strategy and propose how the decision-making theory can help develop the sustainable supply chain management mechanism. Next, we establish a sustainable planning strategy framework. Finally, via a case study with public data on the fashion giant brand Nike, we explore the application of our proposed sustainable planning strategy framework. The finding suggests that the strategic planning of fashion companies on sustainability can improve the performance of the stakeholders throughout the whole sustainable fashion supply chain.     

The Effects of Sharing Upstream Information on Product Rollover

The process of introducing new and phasing out old products is called product rollover. This paper considers a periodic‐review inventory system consisting of a manufacturer and a retailer, where the manufacturer introduces new and improved products over an infinite planning horizon using the solo‐roll strategy. We consider two scenarios: (1) the manufacturer does not share the upstream information about new‐product introduction with the retailer and (2) the manufacturer shares the information. For each scenario, we first derive the decentralized ordering policy and the system‐optimal ordering policy with given cost parameters. We then devise an optimal supply chain contract that coordinates the inventory system. We demonstrate that when the inventory system is coordinated, information sharing improves the performance of both supply chain entities. However, this may not be true if the inventory system is not coordinated. We also show that under the optimal contract, the manufacturer has no incentive to mislead the retailer about new‐product information in the information‐sharing model. When demand variability increases, information sharing adds more benefits to the coordinated supply chain. Our research provides insights about coordinating product, financial, and information flows in supply chains with product rollover.     

Experiences of running negotiable and non-negotiable developer contributions side-by-side

In England, Since the 1970s, a system of negotiated project-specific agreements between local planning authorities and developers/landowners has evolved into the sole mechanism by which part of land value uplift ‘released’ by the grant of planning permission is captured by government. In 2010, in an attempt to simplify and speed up the planning process – negotiated planning agreements were regarded as time-consuming and a brake on development – the Community Infrastructure Levy (CIL) was introduced. Originally intended as a simple flat rate charge to replace site-specific planning agreements, CIL now sits alongside that mechanism so that developers pay CIL to help fund infrastructure provision in the locality, whilst planning agreements help mitigate the impact of their development and provide affordable housing. The experience of running a system of negotiated planning agreements alongside a non-negotiable infrastructure levy offers an opportunity to evaluate these policy shifts in order to assess their strengths and weaknesses and whether there are any wider lessons for international discussions of best practice in land value capture. Drawing on survey findings the paper considers the implementation of CIL alongside planning agreements, the revenue and expenditure patterns, and the impact of these combined land value capture mechanisms on development activity and, in particular, on affordable housing supply.     

A framework for food supply chain digitalization: lessons from Thailand

Abstract

The promise of digitalization is enormous and nowhere is it more critical than in its potential to transform food supply chain. Consumers have become more educated and are demanding real-time updated information on foods they consumed through digital media. They are also increasingly demanding to know if the foods they consume are environmentally and socially sustainable or not. As a result, food product traceability, safety, and sustainability issues have become crucial concerns to food retailers, distributors, processors, and farmers. Digitalization allows food supply chains to be highly connected, efficient, and responsive to customer needs and regulation requirements. However, digitalizing a traditional food supply chain is challenging and resource demanding. This is more so for developing countries where moving food from farms to consumers can take months as it travels through an array of middlemen. Unfortunately, little is available in the existing literature on food supply chain digitalization. So far, current researchers mainly explore the benefits of digitalization. Using cases in three companies, this paper explores the practices, challenges, and opportunities faced by Thailand food manufacturers in digitalizing their food supply chains. A framework for food supply chain digitalization is proposed and its implications for research and practices are discussed.     

Shipping Fees or Shipping Free? A Tale of Two Price Partitioning Strategies in Online Retailing

In this article, we study the price partitioning decisions of online retailers regarding shipping and handling (S&H) fees. Specifically, we analyze two partitioning formats used by retailers in this context. In the first scenario, retailers present customers with a price that is partitioned into a product price and a separate S&H surcharge (the PS strategy); in the second, customers are offered free shipping through a non‐partitioned format where the product price already includes the shipping cost (the ZS strategy). We first develop a stylized game‐theoretic model that captures the competitive dynamics between (and within) these two formats. Analysis of the model provides insights into how both firm and product level characteristics drive a retailer's strategic choice regarding which partitioning format to adopt and, hence, determines the equilibrium market structure in terms of proportion of ZS and PS retailers. Subsequently, we conduct empirical analyses, based on product and S&H prices data for two different product categories (digital cameras and printers) collected from online retailers, to validate all the results of our theoretical model. We establish that PS retailers charge lower product prices than ZS ones, but the total price (product + S&H) charged is higher for the first group. The S&H charge for PS retailers can be significant—it is, on average, 5.4% (printers) and 3.0% (digital cameras) for our two product categories. Furthermore, retailers which are popular and/or face risky cost environment are more likely to opt for the ZS strategy, while retailers whose portfolio mostly includes large or heavy products with high cost (S&H)‐to‐price ratios usually choose the PS strategy. Lastly, our empirical study also illustrates that the price adjustment behavior of retailers is affected by their shipping‐fee policies—for example, ZS retailers change their product prices almost 1.5 times more frequently than PS ones.