Complexity measure of supply chain networks

Abstract

In this paper, we use the information entropy method measure and analyze the complexity of supply chain networks. We observe the supply chain networks complexity under the influence of three factors: demand variance pattern, demand information sharing, and lead time. This study shows that, in general speaking sharing demand information, little lead time, and little demand variance can decrease its entropy. Counter-intuitively, under not sharing demand information condition, the customer demand variance decrease may increase the complexity between the supplier order and retailer order. Under sharing customer demand information condition, decrease the lead time may have increase the complexity also between the supplier order and retailer order.