The intelligent product driven supply chain

Establishing connectivity of products with real-time information about themselves can at one level provide accurate data, and at another, allow products to assess and influence their own destiny. In this way, the specification for an intelligent product is being built - one whose information content is permanently bound to its material content. This paper explores the impact of such development on supply chains, contrasting between simple and complex product supply chains. The Auto-ID project is on track to enable such connectivity between products and information using a single, open-standard, data repository for storage and retrieval of product information. The potential impact on the design and management of supply chains is immense. This paper provides an introduction to of some of these changes, demonstrating that by enabling intelligent products, Auto ID systems will be instrumental in driving future supply chains. The paper also identifies specific application areas for this technology in the product supply chain.

Performance assessment of XACML authorizations for supply chain traceability web services

Service-Oriented Architecture (SOA) and Web Services (WS) offer advanced flexibility and interoperability capabilities. However they imply significant performance overheads that need to be carefully considered. Supply Chain Management (SCM) and Traceability systems are an interesting domain for the use of WS technologies that are usually deemed to be too complex and unnecessary in practical applications, especially regarding security. This paper presents an externalized security architecture that uses the eXtensible Access Control Markup Language (XACML) authorization standard to enforce visibility restrictions on trace-ability data in a supply chain where multiple companies collaborate; the performance overheads are assessed by comparing 'raw' authorization implementations - Access Control Lists, Tokens, and RDF Assertions - with their XACML-equivalents. © 2012 IEEE.

The incentives for supply chain collaboration to improve material efficiency in the use of steel: An analysis using input output techniques

In the face of increasing demand and limited emission reduction opportunities, the steel industry will have to look beyond its process emissions to bear its share of emission reduction targets. One option is to improve material efficiency - reducing the amount of metal required to meet services. In this context, the purpose of this paper is to explore why opportunities to improve material efficiency through upstream measures such as yield improvement and lightweighting might remain underexploited by industry. Established input-output techniques are applied to the GTAP 7 multi-regional input-output model to quantify the incentives for companies in key steel-using sectors (such as property developers and automotive companies) to seek opportunities to improve material efficiency in their upstream supply chains under different short-run carbon price scenarios. Because of the underlying assumptions, the incentives are interpreted as overestimates. The principal result of the paper is that these generous estimates of the incentives for material efficiency caused by a carbon price are offset by the disincentives to material efficiency caused by labour taxes. Reliance on a carbon price alone to deliver material efficiency would therefore be misguided and additional policy interventions to support material efficiency should be considered. © 2013 Elsevier B.V.

Coalition and distribution in fuzzy dynamic supply chain systems

In this paper, two models of coalition and income's distribution in FSCS (fuzzy supply chain systems) are proposed based on the fuzzy set theory and fuzzy cooperative game theory. The fuzzy dynamic coalition choice's recursive equations are constructed in terms of sup-t composition of fuzzy relations, where t is a triangular norm. The existence of the fuzzy relations in FSCS is also proved. On the other hand, the approaches to ascertain the fuzzy coalition through the choice's recursive equations and distribute the fuzzy income in FSCS by the fuzzy Shapley values are also given. These models are discussed in two parts: the fuzzy dynamic coalition choice of different units in FSCS; the fuzzy income's distribution model among different participators in the same coalition. Furthermore, numerical examples are given aiming at illustrating these models., and the results show that these models are feasible and validity in FSCS.

Process control in agile supply chain network.

The work comprises a new theoretical development applied to aid decision making in an increasingly important commercial sector. Agile supply, where small volumes of high margin, short life cycle innovative products are offered, is increasingly carried out through a complex global supply chain network. We outline an equilibrium solution in such a supply chain network, which works through limited cooperation and coordination along edges (links) in the network. The links constitute the stochastic modelling entities rather than the nodes of the network. We utilise newly developed phase plane analysis to identify, model and predict characteristic behaviour in supply chain networks. The phase plane charts profile the flow of inventory and identify out of control conditions. They maintain quality within the network, as well as intelligently track the way the network evolves in conditions of changing variability. The methodology is essentially distribution free, relying as it does on the study of forecasting errors, and can be used to examine contractual details as well as strategic and game theoretical concepts between decision-making components (agents) of a network. We illustrate with typical data drawn from supply chain agile fashion products.

Optimisation of the food dairy coop supply chain

In the European Union under the Common Agricultural Policy (CAP) milk production was restricted by milk quotas since 1984. However, due to recent changes in the Common Agricultural Policy (CAP), milk quotas will be abolished by 2015. Therefore, the European dairy sector will soon face an opportunity, for the first time in a generation, to expand. Numerous studies have shown that milk production in Ireland will increase significantly post quotas (Laepple and Hennessy (2010), Donnellan and Hennessy (2007) and Lips and Reider (2005)). The research in this thesis explored milk transport and dairy product processing in the Irish dairy processing sector in the context of milk quota removal and expansion by 2020. In this study a national milk transport model was developed for the Irish dairy industry, the model was used to examine different efficiency factors in milk transport and to estimate milk transport costs post milk quota abolition. Secondly, the impact of different milk supply profiles on milk transport costs was investigated using the milk transport model. Current processing capacity in Ireland was compared against future supply, it was concluded that additional milk processing capacity would not be sufficient to process the additional milk. Thirdly, the milk transport model was used to identify the least cost locations (based on transport costs) to process the additional milk supply in 2020. Finally, an optimisation model was developed to identify the optimum configuration for the Irish dairy processing sector in 2020 taking cognisance of increasing transport costs and decreasing processing costs.

Competing manufacturers in a retail supply chain: On contractual form and coordination

It is common for a retailer to sell products from competing manufacturers. How then should the firms manage their contract negotiations? The supply chain coordination literature focuses either on a single manufacturer selling to a single retailer or one manufacturer selling to many (possibly competing) retailers. We find that some key conclusions from those market structures do not apply in our setting, where multiple manufacturers sell through a single retailer. We allow the manufacturers to compete for the retailer's business using one of three types of contracts: a wholesale-price contract, a quantity-discount contract, or a two-part tariff. It is well known that the latter two, more sophisticated contracts enable the manufacturer to coordinate the supply chain, thereby maximizing the profits available to the firms. More importantly, they allow the manufacturer to extract rents from the retailer, in theory allowing the manufacturer to leave the retailer with only her reservation profit. However, we show that in our market structure these two sophisticated contracts force the manufacturers to compete more aggressively relative to when they only offer wholesale-price contracts, and this may leave them worse off and the retailer substantially better off. In other words, although in a serial supply chain a retailer may have just cause to fear quantity discounts and two-part tariffs, a retailer may actually prefer those contracts when offered by competing manufacturers. We conclude that the properties a contractual form exhibits in a one-manufacturer supply chain may not carry over to the realistic setting in which multiple manufacturers must compete to sell their goods through the same retailer. © 2010 INFORMS.

Improving supply chain performance: Real-time demand information and flexible deliveries

In some supply chains, materials are ordered periodically according to local information. This paper investigates how to improve the performance of such a supply chain. Specifically, we consider a serial inventory system in which each stage implements a local reorder interval policy; i.e., each stage orders up to a local basestock level according to a fixed-interval schedule. A fixed cost is incurred for placing an order. Two improvement strategies are considered: (1) expanding the information flow by acquiring real-time demand information and (2) accelerating the material flow via flexible deliveries. The first strategy leads to a reorder interval policy with full information; the second strategy leads to a reorder point policy with local information. Both policies have been studied in the literature. Thus, to assess the benefit of these strategies, we analyze the local reorder interval policy. We develop a bottom-up recursion to evaluate the system cost and provide a method to obtain the optimal policy. A numerical study shows the following: Increasing the flexibility of deliveries lowers costs more than does expanding information flow; the fixed order costs and the system lead times are key drivers that determine the effectiveness of these improvement strategies. In addition, we find that using optimal batch sizes in the reorder point policy and demand rate to infer reorder intervals may lead to significant cost inefficiency. © 2010 INFORMS.

Trade credit linkages along the supply chain: evidence for the Italian textile sector

We examine the trade credit linkages among firms within a supply chain to reckon the effect of such linkages on the propagation of liquidity shocks from downstream to upstream firms. We choose a sample appropriate for this task, consisting of a large data set of Italian firms from the textile industry, a well known example of a comprehensive manufacturing cluster featuring a large number of small and specialized firms at each level of the supply chain. The results of the analysis indicate that the level of trade credit that firms provide to their suppliers is positively related to the level of trade credit granted to their clients: when the level of trade credit granted to clients divided by sales goes up by 1, the level of trade credit provided to suppliers divided by cost-of goods-sold goes up by an amount that varies between 0,22 and 0,52. Since all firms along the chain are linked by trade credit relationships, an increase in the level of trade credit granted by wholesalers generates a liquidity cascade throughout the chain. We designate the overall increase in the level of trade credit among all firms in the chain as a result of a unitary impulse in the level of trade credit granted by wholesalers as the multiplier effect of trade credit for the industry chain. We estimate such multiplier to vary between 1.28 and 2.04. We also investigate the effect of final demand on the level of trade credit sourced by firms at various levels of the chain and, in particular, whether such effect is amplified for firms further up in the chain as a result of liquidity propagation via trade credit linkages. We uncover evidence of such amplification when the links of liquidity transmission along the chain are individually modeled and estimated. An unitary increase in wholesalers’ sales is found to produce an effect on trade payables among firms at the top of the chain (i.e., Preparers and Spinners) that is more than twice as big as the corresponding effect among firms at the bottom of the chain (i.e., Wholesalers).

Learning and practising supply chain management strategies from a business simulation game: a comprehensive supply chain simulation

An Internet based supply chain simulation game (ISCS) is introduced and demonstrated in this paper. Different from other games and extended from the Beer Game, a comprehensive set of supply chain (SC) management strategies can be tested in the game, and these strategies can be evaluated and appraised based on the built-in Management Information System (MIS). The key functionalities of ISCS are designed to increase players SC awareness, facilitate understanding on various SC strategies and challenges, foster collaboration between partners, and improve problem solving skills. It is concluded that an ISCS can be used as an efficient and effective teaching tool as well as a research tool in operations research and management science. Problems and obstacles have been observed while engaging in the SC business scenario game. The actions proposed and implemented to solve these problems have resulted in improved SC performance.