Optimum Production-Ordering Policy for a Vendor Buyer Co-Ordinated System Subject to Production Disruption

Abstract

In modern era with an increase in globalization, supply chain system becoming more complex and competitive in order to satisfies the demands of the customers. The rigorous research over the span of time on supply chain has made supply chain not only trendy but also more complex. In the recent past years, the scholars have found various key trends like JIT (just in time), outsourcing, global sourcing, etc. These concepts have increased the efficiency of the supply chain but simultaneously made the supply chain more vulnerable to risk and disruption. In this paper, a recovery model for two-stage co-ordinated serial supply chain having a vendor and buyer has been presented. The objective is to determine the optimum numbers of orders when disruption occurs. There is need of production policy for the system at disruption state. The consideration of some fine at vendor level in order to recover original schedule in place of the disruption is necessary. The model is solved on LINGO. The behaviour of the system with various cost parameters is also analysed.