Supply Chain Case Research Articles

Design and planning of supply chains with integration of reverse logistics activities under demand uncertainty

In this paper, a mixed integer linear programming (MILP) formulation is developed for the design and planning of supply chains with reverse flows while considering simultaneously production, distribution and reverse logistics activities. It is also considered products’ demand uncertainty using a scenario tree approach. As main goal the model defines the maximization of the expected net present value and the results provide details on sizing and location of plants, warehouses and retailers, definition of processes to install, establishment of forward and reverse flows and inventory levels to attain. The model is applied to a representative European supply chain case study and its applicability is demonstrated.

Closed-Loop Supply Chain Network Design with Recovery of Glass Containers

Reverse logistics (RL) and closed-loop supply chains (CLSC) have recently received enormous attention due to growing environmental concerns and legislations coupled with the lucrative business potential. The main purpose of this paper is to develop a closed-loop supply chain network design model capable of recovering glass containers. A multi-period multi-product mixed-integer linear programming model is proposed to maximize profit. The strategic design of the supply chain is dealt simultaneously with the tactical planning of its operation, which covers procurement, production, storage, distribution, take-back, reprocessing, reuse, and recycling. To illustrate the efficiency and practicability of the model, it is applied to a real-world case of beverage supply chain where the glass containers are either re-used or recycled into their original form, as raw materials. Finally, sensitivity analyses, from a financial perspective, have been conducted to reveal the determinants of profitable product recovery and grasp their managerial implications. The analyses showed that return rate and return acquisition cost have determinant impact on the economic viability of product recovery practice.

The integrated framework for analysis of electricity supply chain using an integrated SWOT-fuzzy TOPSIS methodology combined with AHP: The case of Turkey

This paper proposes an integrated framework for analysis of an electricity supply chain using an integrated SWOT-fuzzy TOPSIS methodology combined with Analytic Hierarchy Process (AHP). The paper is divided into two main sections. In the first main section, the integrated framework comprising a qualitative framework and a quantitative framework is presented. In the qualitative framework, a general structure and so-called advanced planning framework are developed for an electricity supply chain based on the literature review in supply chain management (SCM). Then, a quantitative Strengths–Weaknesses–Opportunities–Threats (SWOT) framework is used to formulate a strategy plan based on the elements from the proposed qualitative framework. Since a qualitative SWOT analysis can be insufficient to formulate an action plan, an integrated SWOT-fuzzy TOPSIS methodology combined with AHP is proposed to prioritize the defined SWOT factors and to formulate a strategy plan with top priorities. In the second main section, the integrated framework is illustrated with the case of electricity supply chain in Turkey.

Competition among supply chains: Implications of full returns policy

We examine decisions of retailers and manufacturers in two competing supply chains selling a substitutable product, with demand uncertainty, when manufacturers offer or do not offer full returns policies. We consider retailers' two pricing strategies, optimal pricing and clearance pricing, and we find that full returns policies have different implications in the presence of chain-to-chain competition as compared to the case of a monopoly supply chain. The conditions under which manufacturers and retailers prefer or not prefer full returns policies are identified.

Total Cost of Ownership Along the Supply Chain: A Model Applied to the Tinting Industry

Total Cost of Ownership (TCO) is a consolidated purchasing tool applied across different industries. However, in some cases existing models are not satisfactory. The paper addresses the case of the tinting industry supply chain, which is constituted as follows: manufacturers of colorant dispensing machines sell products and related services to paint producers, so they are able to sell the colour paints to the final consumers. Authors developed a TCO model integrating those existing in literature and including the following specifications: i) all relevant costs along the product life-cycle must be considered; ii) both goods and service-related costs are taken into consideration; iii) both explicit and hidden costs are highlighted; iv) the model should assume all actors’ perspective in the supply chain. The TCO model was tested with real data and gave the opportunity to provide useful insights on real costs sustained by each actor.

Modeling a low-carbon garment supply chain

This article attempts to introduce indirect carbon emission and trade-credit concept in a network optimisation model for sustainable supply chain. The proposed model optimises total cost, total direct carbon emission, total indirect emission in the form of embodied carbon footprint of the raw material and total trade-credit amount over the purchased item in a supply chain. The model calculates the total cost by considering purchasing cost, logistics cost, handling cost and manufacturing cost. It attempts to measure the direct emission involved in manufacturing and logistics operations. The model has the capability to consider dissimilar trucks used for transportation according to their operating cost and carbon emission. Multi-objective goal programming is applied to deal with four objectives to find a tradeoff among these objectives. The result suggests that managers should capture the direct as well as the indirect emission which helps in arriving at appropriate strategy for a sustainable supply chain. The effectiveness of the proposed model is demonstrated through a case of a garment supply chain. This model also supports in deciding appropriate goal for carbon emission, supply chain costs, etc.

Evaluating supply chain risk in Indian dairy industry: a case study

Risk and uncertainty have been found to be one of the indispensable parts of any manufacturing or service supply chain. No matter how strong is the supply chain, risk and uncertainty come into the picture by disrupting the operational flow. The situation further gets complicated, if the nature of the material the supply chain deals in, is perishable requiring conditioned transportation and storage. In this context, dairy-food supply chain is not a deviation. The empirical paper describes the risks and uncertainties of a dairy-food supply chain case in India. The study involves all the stakeholders in the system to identify the potential risks for the entire chain and strategies to address the same. The data, from 1,063 sample respondents, at different levels of the supply chain, are collected and assessed to detect major operational risks for the dairy industry. In total, 15 significant risks are identified throughout the supply chain of which eight are assessed to be critical ones. Strategies to minimise...

Pharmaceutical Supply Chain and Distribution Network in Tanzania

Problem: Despite the efforts made by the Government of Tanzania since 1994 to reform the health sector, Tanzania is still facing a number of challenges: increasing morbidity and mortality rate due to HIV/AIDS and Malaria, increasing demand for health care due to population increase at a 2.032% growth rate and varying disease patterns, difficulties in forecasting demand fluctuations of medicines, shortfall in annual health sector budget allocations and increasing costs of essential health care medicines. These challenges hinder the achievement of quality health and weaken the nation. Objective: The aim of this research was to critically analyze the current challenges facing the pharmaceutical supply chain and distribution network, evaluate implications on access to medicine and quality health care and identify areas for application of process innovation to improve the performance and match demand and supply of pharmaceuticals. The case study focused on the Public Pharmaceutical Sector in Tanzania.Design/Methodology/Approach: This was an explanatory research design based on embedded multiple case studies. The unit of analysis was pharmaceutical supply chain and its participating organizations. The case study was based on “how” and “what” type of questions with a mixture of qualitative and quantitative data. Multiple sources of evidence “triangulation” were used to collect primary and secondary data. Worldwide pharmaceutical supply chain cases from the USA, India, China, Ghana and Zambia were selected for analysis to guide analytic generalization and recommendations. Cross-case and within case analysis techniques along with the conceptual framework and literature review were used to analyze the cases and case study protocol and database were developed.Key Findings: The study found critical challenges; significant delays of more than 3 months of government funding to MSD, medicines are expensive; more than 20 million US dollar expenditures per year on medicines, a staggering debt of approximately 24 million US dollar to government, lack of stock control, poor demand and stock information flow, errors in demand forecasting as a result causing delays in delivery, stock-out, medicine shortages at health facilities and demand-supply mismatching. Changing disease patterns was also contributing to unavailability of medicines. Conclusion: The poor performance of pharmaceutical supply chain and distribution network has negative implications on access to medicines and quality health care.Recommendations: Process innovation model was proposed for analyzing the pharmaceutical supply chain performance. It was recommended a need for integration of activities in the supply chain along with collaboration and coordination among participants at each stage.

Coordinating the ordering and advertising policies for a single-period commodity in a two-level supply chain

This study deals with the news-vendor problem to the case of a two-level supply chain consisting of one manufacturer and one retailer, and investigates the combined effects of the cooperative advertising mechanism, the return policy and the channel coordination. The manufacturer and the retailer could maintain the potential market size by making some marketing expenditures on some national brand names and invest in local advertising, but with diminishing returns. The decision problem facing the profit-oriented entities in the supply chain is to determine the optimal advertising and inventory policies for maximizing their own profit. Both the non-cooperative policy and the cooperative policy are formulated to offer structural and quantitative insights into the interplay between upstream and downstream entities of the supply chain. In addition, the implications of a profit-sharing mechanism based on achieving a win–win relationship of the channel members was also proposed.

Supply chain control logic for enabling adaptability under uncertainty

This paper suggests a probabilistic inference method of quantifying a buyer's likelihood to purchase a highly customised product. The probabilistic inference method utilises the principles of Bayesian networks. This method is integrated into an Internet based supply chain control logic where supply chain partners provide real time or near real time information, regarding the availability of parts needed for the production of highly customisable products. The supply chain plan that is generated is robust, ensuring the supply of the right part at the right time at a rather reasonable cost, thus eliminating the quality defects of the product. The concept is demonstrated in a typical supply chain case, taken from the automotive industry.

Regulatory Framework and Private Innovation: The Case of Animal Welfare Friendly Beef Supply Chain in Italy

The paper examines innovation in the agrifood sector through an analysis of relationships between public institutions and the private sector. The first part is theoretical and analyses the roles played by public and private actors in innovation. The second part is a case study of the beef supply chain of COOP, the biggest retailer on the Italian market. It exemplifies product innovation driven by a regulatory framework and shows how organisation and structural renewal required by animal welfare legislation can lead to voluntary initiatives and additional innovation along the supply chain. The case study also features the role of institutions in communications and shows how market awareness drives improvement in organisation of production chains.

Joint optimisation of demand forecasting and stock control parameters

Exponential smoothing methods are very commonly used for forecasting demand in a supply chain context. When estimating the parameters used in these methods, a common practice is to optimise only the smoothing constants and not the initial parameter values. In this paper we show that if we treat initial values as well as smoothing constants as decision variables, a considerable reduction in forecast error can be achieved. Additionally, the optimisation of the forecasting method should not be treated separately from the production or inventory model in which forecasts are used. The case of a centralised supply chain with an order-up-to inventory policy shows that calculated forecasts of demand, determined by minimising mean absolute error (MAE) or mean squared error (MSE), are not optimal. Finally, a method for simultaneous optimisation of demand forecasting and a stock control policy is described. Initial and smoothing parameters in the forecasting methods can be determined to minimise the total costs.

Internal benchmarking for assessment of supply chain performance

PurposeIn global scenario, many organizations own supply chains, which operate in different countries. The performance of these supply chains, owned by the same organization must be same if they operate in countries with similar economical, political, and social conditions. In this paper, an effort has been made to propose a methodology for the internal benchmarking to reduce the variability in performance among supply chains of same focal firm. The proposed methodology of internal benchmarking for assessment of supply chain performance demonstrated through a case supply chain.Design/methodology/approachA case of global supply chains is presented in which a focal firm owns three supply chains operating in three different countries. In order to assess and improve the performance of these supply chains relative to each other, a benchmarking methodology is proposed.FindingsAn extensive use of performance value analysis (PVA) and strength, weaknesses, opportunities, and threats (SWOT) analysis provided good diagnosis of supply chains. This analysis can be very useful in leveraging the supply chain drivers of various supply chains belonging to same focal organization and hence bring performance of all the supply chains at the same performance level.Originality/valueAccording to the authors' knowledge, there is no paper in the literature, which discusses the application of PVA and SWOT analysis for internal benchmarking in supply chain management and it is believed that it will be useful for supply chain managers to apply such tools to lead global development in their supply chains.

Incorporating impoverished communities in sustainable supply chains

PurposeThe purpose of this paper is to explore recent calls to include social and environmental considerations in supply chains by analyzing the sourcing of raw materials from impoverished communities to reduce environmental impacts and social exclusion in biofuels production.Design/methodology/approachA case study methodology based on interviews and focus groups with supply chain members and other stakeholders is conducted in Brazil, a major biofuels producer and user. Two supply chain cases, fuel ethanol and biodiesel, illustrate the challenges of recent government policies and industry attempts to improve sustainability within the supply chain.FindingsAlthough government and industry recognize the importance of providing opportunities for impoverished communities in biofuels supply chains, there remain considerable pressures to economize at the expense of sustainable supply chain policies. Sourcing from impoverished farmers who lack basic business knowledge, and distrust industry and government policy, compound these challenges.Research limitations/implicationsWhile sustainability research now emphasizes the importance of considering interactions among economic, environmental, and social parameters, little is known about integrating poorly educated, impoverished farmers within supply chains. Basic business education is needed, and further research should explore entrepreneurial dynamics within impoverished communities.Practical implicationsSupply chain managers should acquire skills for engaging with impoverished farmers lacking formal education. Cooperatives can bridge knowledge asymmetries between buyers and suppliers, but will require support from industry if sustainable supply chain policies are to succeed.Originality/valueMost sustainable supply chain scholars acknowledge the importance providing opportunities for impoverished communities, but few have explored how potential entrepreneurs from impoverished communities can participate as productive supply chain members.

Collaborative Supply Chain in the Digital Age: A Case Study of its Extent of Adoption by Indigenous Organizations in Building Inter-and Intra-firm Alignments

The term collaborative supply chain or SCM is a social software package that promises inter-and intra-firm alignments and information sharing to assure outstanding performance of the whole. It involves integrating resources and automating transactions across traditional boundaries to build mutually benefiting competitive advantage. SCM in the digital age encompasses accessibility of internal activities and measurement metrics by external parties as well as optimization of processes for mutual improvement in customer service, and reduction of inventory level and associated cost; good business relationships built on trust and minimized selfishness; and long term flexibility and adaptability evidenced by co-creation of products along the value chain. Apparently, experience has shown too many firms avoid engagement in this extensive supply chain integration, perhaps for fear of breeding conflicts. The paper viewed the current practice of SCM by studying the experiences and insights of 108 managers/officers, drawn from eight indigenous firms. The benchmark for selection was that the subject must be directly involved in supply chain initiatives and case study interviews were used for the survey. The finding unravelled discrepancy between the ideals of theories of SCM and actual practice; no consensus about its meaning, multiple supply chain collaboration compounds the problem even the more, and most times it may be difficult to meet the laid down conditions. Firms easily embrace internal cross functional integration and shun inter-organizational integration, perhaps because they want to build unique competitive advantage. Therefore more orientations should be done to educate managers on the ideals of SCM, especially on the area of dissuading selfish maximization of profits.

Supply chain network modeling in a golf club industry via fuzzy linear programming approach

This paper addresses a supply chain network planning problem faced by a company that manages a golf club supply chain. The supply chain network is considered for the production of several products through an assembly of three modules supplied by different suppliers. A linear programming model is proposed to describe the problem, where multiple components can be assembled within a planning horizon of one to twelve months. The model involves the supply of various components from a set of suppliers and allocation of assembled products to customers. In real world problems practical situations are often not well-defined and thus can not be described precisely. Therefore this model is transformed into the fuzzy models with flexibility in the objective function, in the market demand, and in the available capacity of resources. The main objective is to construct a procurement-assembly plan enabling it to minimize its costs while satisfying the customers’ demand over a given planning horizon in such a way as to hedge against uncertainty. Finally, the proposed model is tested using a case of supply chain from the golf club industry. Sensitivity analyses are also conducted on various parameters to gain insight into the proposed model. Numerical case demonstrates that the proposed fuzzy model can provide a better and more flexible way of representing the problem for the considered industry.

An Approach to Study the Value of Information Sharing in a Serial Supply Chain with Decentralised Decision

In this paper, we study two information shared simultaneously, the first one coming from the upstream and the second coming from the downstream of the supply chain. We treat the case of a multiechelons multi-products serial supply chain. This chain is made up of one supplier, one warehouse, one retailer and several customers. Thus, we develop a model to study various scenarios of information sharing. We focus our approach on the decentralised decision, in which, the goal of each link is to minimise its own logistic cost. The difference between these costs shows the value of the studied information sharing and represents the contribution of a scenario compared to another. The proposed model is solved by ILOG CPLEX integrated in JAVA program. The output results are the optimal cost in each studied situation. The numerical experimentation proves to validate contribution of our approach.

A robust optimisation approach for the milk run problem with time windows with inventory uncertainty: an auto industry supply chain case study

In this paper, we introduce a robust optimisation approach to solve the milk run system with time window with inventory uncertainty. This approach yields routes that minimise transportation costs while satisfying all inventory in a given bounded uncertainty set. The idea of the milk run problem has been used in the context of logistic and supply chain problems in order to manage the transportation of materials. Since the resulted problem formulation is NP-hard, and in order to solve the underlying problem, a novel algorithm entitled robust optimisation has been proposed. We apply the model to solve some numerical examples to show robust solution efficiency versus deterministic. Since the resulted problem illustrates that grows up time in this method is progressive, and in order to solve the large-scale problems, particle swarm optimisation has been proposed. We also observe that the robust solution amounts to a clever management of the remaining vehicle capacity compared to uniformly and non-uniformly distributing this slack over the vehicles.

Development and assessment of modified VIKOR method for multi-criteria single sourcing in supply chain

The sourcing decision plays a major role in supply chain because raw materials/semi-finished goods cost constitute the key cost of final product. We develop a modified VlseKriterijumska Optimizacija I Kompromisno Resenje (VIKOR) method, a compromise ranking model for evaluation and selection of sourcing partners to handle the conflicting and non-commensurable set of criteria and to identify the solution close to ideal. The modified VIKOR method is compared with two multi-criteria decision-making methods: technique for order preference by similarity to an ideal solution (TOPSIS) and elimination and choice translating reality (ELECTRE). All the three approaches were illustrated and compared for a computer retail supply chain case study. The better results of modified VIKOR are validated.

Pharmaceutical Supply Chain and Distribution Network: Implications on Access to Medicine and Quality Health Care- Critical Analysis of The Public Pharmaceutical Sector in Tanzania

Problem: Despite the efforts made by the Government of Tanzania since 1994 to reform the health sector, Tanzania is still facing a number of challenges: increasing morbidity and mortality rate due to HIV/AIDS and Malaria, increasing demand for health care due to population increase at a 2.032% growth rate and varying disease patterns, difficulties in forecasting demand fluctuations of medicines, shortfall in annual health sector budget allocations and increasing costs of essential health care medicines. These challenges hinder the achievement of quality health and weaken the nation. Objective: The aim of this research is to critically analyze the current challenges facing the pharmaceutical supply chain and distribution network, evaluate implications on access to medicine and quality health care and identify areas for application of process innovation to improve the performance and match demand and supply of pharmaceuticals. The case study focuses on public pharmaceutical sector in Tanzania. Design/Methodology/Approach: This is an explanatory research design based on embedded multiple case studies. The unit of analysis is pharmaceutical supply chain and its participating organizations. The case study was based on “how” and “what” type of questions with a mixture of qualitative and quantitative data. Multiple sources of evidence “triangulation” were use to collect primary and secondary data. Worldwide pharmaceutical supply chain cases from the USA, India, China, Ghana and Zambia were selected for analysis to guide analytic generalization and recommendations. Cross-case and within case analysis techniques along with the conceptual framework and literature review were used to analyze the cases and case study protocol and data were developed. Key Findings: The study found critical challenges; significant delays of more than 3 months of government funding to MSD, medicines are expensive; more than 20 million US dollar expenditures per year on medicines, a staggering debt of approximately 24 million US dollar to government, lack of stock control, poor demand and stock information flow, errors in demand forecasting as a result causing delays in delivery, stock-out, medicine shortages at health facilities and demand-supply mismatching. Changing disease patterns is also contributing to unavailability of medicines. Conclusion: The poor performance of pharmaceutical supply chain and distribution network has negative implications on access to medicines and quality health care. Recommendations: Process innovation model was proposed for analyzing the pharmaceutical supply chain performance. It was recommended a need for integration of activities in the supply chain along with collaboration and coordination at each stage.