The value of asset visibility in the supply chain single and dual source models

Abstract

We investigate the value of asset visibility in two inventory ordering models. The first model is a basic single source model, and we use a previous result to show that in this case asset visibility does not reduce costs. We then generalize this model to include a second supply option and show that if decisions are made optimally and asset visibility can add value. We apply these results to an application in which random security inspections are introduced in the supply chain.