A general model for extended strategic supply chain management with emphasis on product life cycles including development and recycling

Abstract

The objective of this paper is to introduce a new perspective of strategic supply chain management to strategic planning. Strategic supply chain management is the long-term part of supply chain management, where the product program and supply chain network are determined. Here the traditional supply chain network of procurement, production, distribution and sales is extended to a product life cycle by the business processes of development and recycling. A general linear mixed integer model is designed considering the business processes of a product life cycle. Goal of this approach is to optimize after-tax profit of a company and to fix the product program and the extended supply chain network. Dynamic aspects are taken into account by the application of a two-step time structure, macro and micro periods, which is well known from general lot-sizing and scheduling optimization models. The main contributions of this new perspective of strategic supply chain management are to permit investment decisions between alternative products and development projects, to compare product life cycles with their development and recycling strategies and to analyze their impact on the supply chain network.