Supply Allocation Research Articles

Impact of demand correlation and information sharing in a capacity constrained supply chain with multiple-retailers

This paper considers a single product, two-echelon capacity constrained supply chain consisting of a supplier and two retailers facing correlated end-item demand. We use a decentralized Markov decision process with restricted observations to represent this system and conduct a numerical study to quantify the benefits of information sharing to the retailers under varying levels of supplier capacity and supply allocation mechanisms. Our results show an inverse relationship between capacity and information and indicate the retailers can achieve significant benefits as a result of the information sharing partnership.

Supply capacity acquisition and allocation with uncertain customer demands

We study a class of capacity acquisition and assignment problems with stochastic customer demands often found in operations planning contexts. In this setting, a supplier utilizes a set of distinct facilities to satisfy the demands of different customers or markets. Our model simultaneously assigns customers to each facility and determines the best capacity level to operate or install at each facility. We propose a branch-and-price solution approach for this new class of stochastic assignment and capacity planning problems. For problem instances in which capacity levels must fall between some pre-specified limits, we offer a tailored solution approach that reduces solution time by nearly 80% over an alternative approach using a combination of commercial nonlinear optimization solvers. We have also developed a heuristic solution approach that consistently provides optimal or near-optimal solutions, where solutions within 0.01% of optimality are found on average without requiring a nonlinear optimization solver.

Tracking a rainfall index constrained by Conditional Value-at-Risk

Portfolio replication is a well studied problem from finance, whereby a subset of instruments is selected to track the average movement of all such instruments. Using expected monetary value as the decision criterion for selection is a trade-off of over and under estimators. An alternate criterion developed in finance is Conditional Value-at-Risk, employed to measure and restrict excessive deviation either above or below the centre. That same objective may be useful in monitoring environmental variables where the exclusion or inclusion of extreme values may be critical to representing the features of interest of the variable. We demonstrate the application of the risk measure to meteorological data in Australia, selecting a weighted combination of stations to best track an index of average annual rainfall. References Howlett, P. G. and Piantadosi, J. (2007). A note on Conditional Value at Risk. Optimization , 56 , 629--632. doi:10.1080/02331930701617080 Rockafellar, R. T. and Uryasev, S. (2002). Conditional Value-at-Risk for General Loss Distributions. Journal of Banking and Finance , 26 , 1443--1471. doi:10.1016/S0378-4266(02)00271-6 Webby, R. B., Adamson, P. T., Boland, J., Howlett, P. G., Metcalfe, A. V. and Piantadosi, J. (2006). The Mekong---applications of Value-at-Risk and Conditional-Value-at-Risk simulation to the benefits, costs and consequences of water resources development in a large river basin. Ecological Modelling , 201 , 89--96. doi:10.1016/j.ecolmodel.2006.07.033 Yamout, G. M., Hatfield, K. and Romeijn, H. E. (2007) Comparison of new conditional value-at-risk management for optimal allocation of uncertain water supplies. Water Resources Research , 43 , W07430. doi:10.1029/2006WR005210 Yum, K.-K., Blackmore, J. and Anticev, J. (2009). Modelling and evaluating water allocation risks using Value-at-Risk. Proceedings of the 18th World IMACS/MODSIM Congress . http://www.mssanz.org.au/modsim09/G3/yum.pdf [20/04/2010].

Supplier allocation and safety stock determination based on supplier reliability

Supplier selection and allocation of demand across suppliers has become a critical activity for organisations. Safety stocks are necessary to protect against shortages caused by supplier delivery failures and to achieve reasonable customer service levels. We present a new supplier selection model that determines safety stocks based on the supplier delivery reliability. The model includes procurement costs, supplier management costs, inventory carrying costs, and loss costs due to missed deliveries. An example is provided, followed by a sensitivity analysis that illustrates how the model can be used to analyse different sourcing strategies under various cost parameters.

Spatially Explicit Static Model for the Strategic Design of Future Bioethanol Production Systems. 1. Cost Minimization

Dependence upon fossil sources and environmental concerns have been driving the research for alternative systems for automotive fuel production. In this work, a general modeling framework conceived to drive the decision-making process for the strategic design of biofuel supply networks is presented. The design task is formulated as a mixed integer linear program (MILP) that accounts for the simultaneous minimization of the supply chain operating costs (part 1) as well as the environmental impact in terms of greenhouse gas (GHG) emissions [part 2 (DOI 10.1021/ef9004779)]. The model is devised for the integrated management of the key issues affecting a general biofuel supply chain, such as agricultural practice, biomass supplier allocation, production site locations and capacity assignment, logistics distribution, and transport system optimization. A spatially explicit approach has been adopted to capture the strong geographical dependence of the biomass cultivation practice performance. A purpose-designed ...

New reconstructions of streamflow variability in the South Saskatchewan River Basin from a network of tree ring chronologies, Alberta, Canada

In western Canada growing demand for water resources has increased vulnerability to hydrological drought. The near full allocation of water supplies in the Oldman and Bow River subbasins of the South Saskatchewan River Basin has resulted in a moratorium on new surface water licenses. In this region, short instrumental records limit the detection of long‐term hydrological variability. To extend the historical record, we collected 14 new moisture‐sensitive tree ring chronologies and reconstructed the average October through September flow of the Oldman (1618–2004) and South Saskatchewan (SSR) (1400–2004) rivers. Our SSR proxy record updates a previously published reconstruction. While the 20th century is representative of drought frequency over the long term, droughts are of greater severity and duration in the preinstrumental proxy record. A spectral analysis of the reconstructed flows revealed quasiperiodic cycles at interannual to multidecadal scales.

Impact assessment of combined climate and management scenarios on groundwater resources and associated wetland (Majorca, Spain)

Summary Climate change impact on a groundwater dependent wetland and natural recharge has been investigated in the Inca-Sa Pobla coastal aquifer for the year 2025. Temperature and precipitation based on the downscaled output from a general circulation model (GCM) was coupled to a groundwater model to estimate the impacts of climate change and management practices on groundwater. Management practices were based on changes in the volume of water extracted for agricultural and domestic purposes. Climate change impacts on the hydrogeological system were based on downscaled HadCM3 outputs for future medium–high (A2) and medium–low (B2) greenhouse gas scenarios developed by the IPCC [IPCC, 2001. Climate change 2001: the scientific basis. In: Houghton, J.T., Ding, Y., Griggs, D.J., Noguer, M., Van Der Linden, P.J., Dai, X., Maskell, K., Johnson, C.A. (Eds.), Contribution of Working Group I to the Third Assessment Reports of the Intergovernmental Panel on Climate Change. Cambridge University Press, Cambridge, United Kingdom and New York, NY, USA, 881 pp]. Assessment of the impacts on the water level of the wetland were carried out by estimating the flow rate of springs discharging from the aquifer obtained by changes of agricultural land use and water supply allocation and variation of recharge according climate scenarios. The greatest reduction in recharge was observed in scenario A2 (−21%), while recharge in scenario B2 remained relatively unchanged (−4%). However, as uncertainties arising from GCM outputs maybe greater than the differences simulated here results are only indicative of the system response. In order to preserve the spring discharge at its current level (17 Mm3/yr), which successfully prevents the wetland from drying up, a decrease in groundwater extraction is needed. In addition, the reallocation of agricultural wells is recommended under both scenarios. Spring discharge was affected the most by agricultural wells located near the wetland, as indicated by the sensitivity analysis.

Forty Years of Publication of Transplantation Proceedings—The Second Decade: The Cyclosporine Revolution

With surgical tools in place, increased knowledge concerning immunogenetics and alloimmunity as well as improved management of immunocompromised patients, the foundations were lain for the rapid development of the transplantation enterprise. In contrast to pre-transplant conditioning by thoracic duct drainage or total lymphoid irradiation, which were too cumbersome for routine execution among the burgeoning recipient pool, cyclosporine was a facile method to produce immunosuppression de novo after transplantation. On the one hand, clinical data confirmed the potency of cyclosporine in a variety of clinical settings. On the other hand, a pleiotropic array of side effects, particularly nephrotoxicity, beclouded the regimens, even when used in reduced doses in combination with azathioprine or together with rigorous individualization of therapy by concentration control. The advent of cyclosporine condemned conditioning by pretransplant blood transfusions and donor-recipient HLA matching to therapeutic obsolescence. However, cross-matching achieved greater significance particularly due to the development of flow cytometry methods to detect modest amounts of anti-donor antibody. Adjunctive treatments with polyclonal preparations or monoclonal antibodies were developed to provide an additional layer of security during the critical induction phase of immunosuppression and for treatment of rejection episodes refractory to high dose steroid therapy. Active immunologic investigation was stimulated by antibodies that discriminated CD4+ versus CD8+ T cells, leading to dissection of their numbers of precursors or mature elements as well as their distinct activities. The search for methods to induce, maintain and detect the state of transplantation tolerance continued. The encouraging results in clinical transplantation raised a variety of ethical concerns related to public attitudes; to retrieval, distribution, and allocation of the limited supply of deceased donor organs; the increased utilization of living persons; the opportunities for commerce; the quasi-righteous requests for organ gifts by unrelated individuals and the scant financial resources for long-term treatment with costly immunosuppression. Transplantation had now achieved its rightful place in the clinical armamentarium.

Integrating a shrimp-growth function, farming skills information, and a supply allocation algorithm to manage the shrimp supply chain

This study examines the coordination problem in the Thai shrimp supply chain. Farming skills and demand seasonality play a crucial role in the chain inventory problem. The proposed purchasing allocation framework consists of a shrimp-growth model, database management and a supply allocation algorithm. The objective of the framework is to minimize overall inventory costs of the chain. Scenario analysis is used to demonstrate the application of the framework. The results show that different efficient plans are appropriate for different scenarios. Hence, establishing a precise plan will potentially reduce inventory cost. The supply allocation decision without a systematic plan would raise inventory cost and would lead to the production of excess shrimp of undesirable sizes. A strong coordination among all members in the chain will benefit all parties and better serve the customers.

Estimating labour supply and time allocation by married Japanese men and unmarried Japanese women

In this article, I estimate the uncompensated and compensated wage elasticities and the income elasticity of time, for married men and unmarried women in Japan. For the purpose of the estimation, I control for the potential endogeneity of the wage and income variables.

Supply chain risk-sharing contracts from a buyers' perspective: content and experiences

Incentive alignment, and risk and gain sharing, are argued to be key factors for the successful implementation of Supply Chain Management (SCM). Incentive-related issues can be improved by contract based, information-based and trust-based solutions. The focus of this article is on contract mechanisms used in the context of high demand volatility, supply allocation and outsourced supply chains. Two case illustrations from a high-tech industry (Agilent and Hewlett Packard) describe recently implemented risk-sharing contracts, as well as experiences and issues regarding their implementation from a buyers' perspective. Although the work of implementing these more formal contracts is demanding, buyers are pleased with the results and the buyers also report pleased suppliers. In the cases, the main barrier to implementing risk-sharing contracts seems to be the shift in mindset and culture needed internally, especially among purchasers.

Effects of calcium availability on reproductive output of big brown bats

AbstractReproduction is a period of high calcium demand in vertebrates; therefore, calcium deficiency can limit reproductive output in mammals. Nutritional analyses show that insects are a poor calcium source, suggesting that insectivorous species are more likely to be calcium deficient. During pregnancy, big brown bats Eptesicus fuscus consume between 8 and 18 times less calcium than they are estimated to require. To accommodate calcium demand during pregnancy, many mammals mobilize more calcium from the skeleton, and extensive bone loss has been observed in some bats during pregnancy. A conflict may arise between the female and developing embryo over allocation of limited calcium supplies, which could limit reproductive output with respect to offspring size, mass and number. The effects of calcium deficiency on these three factors were tested by providing pregnant captive big brown bats with either a calcium‐deficient diet or a diet providing the daily calcium requirement, as estimated for pregnant big brown bats, from the time of capture until parturition. Neonates were compared between groups for size, mass and number per female, as were the effects of maternal mass and size on neonate mass and size. Maternal mass and litter mass were positively related for the calcium‐deficient group, but not for the calcium‐supplemented group. This suggests that there is some interaction between maternal mass and calcium availability, most likely due to the relationship between body mass and skeletal mass, and that calcium availability is limiting the overall biomass of young that a female can produce.

Modeling Multisource Multiuser Water Resources Allocation

Water shortage emerges and restricts the urban construction and the socio-economy development due to the rapid expansion of the cities throughout the world. Recently treated wastewater reuse, including rainwater collection and utilization, and seawater desalination, etc., has been put in practice in some cities. This paper presents the characteristics of urban multisource water and multiuser and a multi-objective optimization model of reasonable allocation on multisource water for multiuser under sufficiently considering the harmonious development among economy, society and environment. As a case study this model had been applied to the reasonable allocation of water supply and demand in Dalian City in 2010, 2015 and 2020, in which the maximal benefit of economy, society and environment was regarded as the multi-objectives and the step method was adopted to solve the model. The result indicates that the proportion of the reused water to the total water consumption is gradually increasing, but the proportion of the high quality water to the total water consumption is decreasing. In other words, as a secondary water resource, the reused water has replaced partial high quality water gradually. Consequently, the reasonable allocation of urban multisource water for multiuser is the available approach to alleviate urban water crisis and achieve the sustainable utilization of urban water resources.

Comparison of new conditional value‐at‐risk‐based management models for optimal allocation of uncertain water supplies

The paper studies the effect of incorporating the conditional value‐at‐risk (CVaRα) in analyzing a water allocation problem versus using the frequently used expected value, two‐stage modeling, scenario analysis, and linear optimization tools. Five models are developed to examine water resource allocation when available supplies are uncertain: (1) a deterministic expected value model, (2) a scenario analysis model, (3) a two‐stage stochastic model with recourse, (4) a CVaRα objective function model, and (5) a CVaRα constraint model. The models are applied over a region of east central Florida. Results show the deterministic expected value model underestimates system costs and water shortage. Furthermore, the expected value model produces identical cost estimates for different standard deviations distributions of water supplies with identical mean. From the scenario analysis model it is again demonstrated that the expected value of results taken from many scenarios underestimates costs and water shortages. Using a two‐stage stochastic mixed integer formulation with recourse permits an improved representation of uncertainties and real‐life decision making which in turn predicts higher costs. The inclusion of CVaRα objective function in the latter provides for the optimization and control of high‐risk events. Minimizing CVaRα does not, however, permit control of lower‐risk events. Constraining CVaRα while minimizing cost, on the other hand, allows for the control of high‐risk events while minimizing the costs of all events. Results show CVaRα exhibits continuous and consistent behavior with respect to the confidence level α, when compared to value‐at‐risk (VaRα).

Outsourcing via Service Competition

We consider a single buyer who wishes to outsource a fixed demand for a manufactured good or service at a fixed price to a set of potential suppliers. We examine the value of competition as a mechanism for the buyer to elicit service quality from the suppliers. We compare two approaches the buyer could use to orchestrate this competition: (1) a supplier-allocation (SA) approach, which allocates a proportion of demand to each supplier with the proportion allocated to a supplier increasing in the quality of service the supplier promises to offer, and (2) a supplier-selection (SS) approach, which allocates all demand to one supplier with the probability that a particular supplier is selected increasing in the quality of service to which the supplier commits. In both cases, suppliers incur a cost whenever they receive a positive portion of demand, with this cost increasing in the quality of service they offer and the demand they receive. The analysis reveals that (a) a buyer could indeed orchestrate a competition among potential suppliers to promote service quality, (b) under identical allocation functions, the existence of a demand-independent service cost gives a distinct advantage to SS-type competitions, in terms of higher service quality for the buyer and higher expected profit for the supplier, (c) the relative advantage of SS versus SA depends on the magnitude of demand-independent versus demand-dependent service costs, (d) in the presence of a demand-independent service cost, a buyer should limit the number of competing suppliers under SA competition but impose no such limits under SS competition, and (e) a buyer can induce suppliers to provide higher service levels by selecting an appropriate allocation function. We illustrate the impact of these results through three example applications.

Income Taxation of Couples and the Tax Unit Choice

This paper studies the optimal non linear income tax of couples. We build a general unitary model of labor supply and allow multidimensional heterogeneity in a discrete type framework. We concentrate our analysis on the resulting intra-family labor allocation of labor supplies and show that this analysis is strongly related to the choice of the tax unit (individual versus joint taxation). We give a necessary condition to have fully joint taxation in this framework and discuss some examples.

Trade Creation and Trade Diversion in the European Union: An Alternative Approach

This paper analyzes empirically the existing trade relationships between the trading partners which include Greece, the other European Union Countries (EU), the rest of the world countries (ROW), and Turkey. It also investigates whether Greece's accession to the EU caused a structural break in the allocation of total supplies of agricultural and manufactured products over domestic and foreign supplies. Finally, it predicts the possible trade effects of the accession of Turkey to the European Union. We estimate an expenditure or complete-import model via the Almost Ideal Demand System. The model includes home-produced commodities and imports from three trading regions: EU, ROW and Turkey, and specify the relationships between the shares in total supplies and total real demand and relative prices.

Can Australia Overcome its Water Scarcity Problems

Australia is a continent of extremes with respect to water resources ; relative abundance in the tropical north where few people live and relative scarcity in the more populated, temperate south. In addition, both south and north are a#ected by wet/dry seasonal climatic conditions and the south, in particular, by increasing climate variability marked generally by declining rainfall. In the south, previous poor governance systems have led to the over allocation of surface and groundwater supplies and there is increasing competition for water from irrigators, urban/domestic, industrial and mining users. As a consequence, there has been a major deleterious impact on the health of many rivers and their associated environments. Therefore, Australia is confronted with a major question; can water productivity and water governance be improved to ensure environmentally sustainable and productive river systems? This paper examines how this may be achieved. It concludes that economic reforms coupled with scientific and management innovation may alleviate many of the water scarcity issues.

A supplier allocation model considering delivery failure, maintenance and supplier cycle costs

Supplier decision-making is a critical component of supply chain management given the recent increased reliance of many organizations on their suppliers. This paper presents a decision model that optimizes the allocation of demand across a set of suppliers by considering the expected losses due to supplier failure to deliver, the purchasing costs, and the cost of maintaining a set of suppliers. In the case of multiple sourcing, the model takes into consideration the ability of suppliers to increase their output when one or more suppliers fail to deliver. A sensitivity analysis is performed to illustrate the model's behavior with regards to parameters such as the probability of supplier failure, the cost of supplier failure, and the output flexibility of the suppliers. Finally, we present an application case where the model's potential to analyze the supplier demand allocation decision is demonstrated.

WEAP21—A Demand-, Priority-, and Preference-Driven Water Planning Model

Potential conflicts arising from competing demands of complex water resource systems require a holistic approach to address the tradeoff landscape inherent in freshwater ecosystem service evaluation. The Water Evaluation and Planning model version 21 (WEAP21) is a comprehensive integrated water resource management (IWRM) model that can aid in the evaluation of ecosystem services by integrating natural watershed processes with socio-economic elements that include the infrastructure and institutions that govern the allocation of available freshwater supplies. The bio-physical and socioeconomic components of Battle Creek and Cow Creek, two tributaries of the Sacramento River of Northern California, USA, were used to illustrate how a new hydrologic sub-module in WEAP21 can be used in conjunction with an imbedded water allocation algorithm to simulate the hydrologic response of the watersheds and aid in evaluating freshwater ecosystem service tradeoffs under alternative scenarios.