On the strategy of supply chain collaboration based on dynamic inventory target level management: a theory of constraint perspective. (English) Zbl 1426.90030
Summary: After the financial tsunami in 2008, how to adjust the target inventory level dynamically and instantly in order to reduce the risk that an enterprise encountered in a rapid demand changing market has become a crucial issue in the field of supply chain management. This paper explores the strategies of supply chain collaboration by utilizing theory of constraint to achieve the goal of adjusting the target inventory level dynamically. Three time-series-data-mining techniques – Sequential Probability Ratio Test (SPRT), CUSUM chart and Auto-regression Test (AR(1)) are used to detect the timing of market demand change. The results are used to adjust the target inventory level. Simulation techniques are used to explore the relative efficiency of the demand-change detection for the three methods. The techniques are also used to explore the effectiveness of various inventory management strategies on inventory performance based on the three demand change detection methods.
References:
| [1] | Lee, H. L.; Padmanabhan, V.; Whang, S., The bullwhip effect in supply chains, Solan Manage. Rev./Spring, 93-102, (1997) |
| [2] | Anupindi, R. T.; Morton, E.; Pentico, D., The non-stationary stochastic lead-time inventory problem: near-myopic bounds, heuristics, and testing, Manage. Sci., 42, 1, 124-129, (1996) · Zbl 0851.90026 |
| [3] | Platt, D. E.; Robinson, L. W.; Freund, R. B., Tractable (Q,R) heuristics models for constrained service levels, Manage. Sci., 43, 7, 951-965, (1997) · Zbl 0890.90051 |
| [4] | Vargas, V. A.; Metters, R., Adapting lot sizing techniques to stochastic demand through production scheduling policy, IIE Trans., 28, 141-148, (1996) |
| [5] | Barratt, M., Understanding the meaning of collaboration in the supply chain, Supply Chain Manage.: An Int. J., 9, 1, 30-42, (2004) |
| [6] | Cassivi, L., Collaboration planning in a supply chain, Supply Chain Manage.: An Int. J., 11, 3, 249-258, (2006) |
| [7] | Horvath, L., Collaboration: the key to value creation in supply chain management, Supply Chain Manage.: An Int. J., 6, 5, 205-207, (2001) |
| [8] | Ireland, R.; Bruce, R., CPFR only the beginning of collaboration, Supply Chain Manage. Rev., 4, 4, 80-88, (2000) |
| [9] | Pramatari, K., Collaborative supply chain practices and evolving technological approaches, Supply Chain Manage.: An Int. J., 12, 3, 210-220, (2007) |
| [10] | Mentzer, J. T.; Foggin, L. H.; Golicic, S. L., Collaboration: the enablers, impediments, and benefits, Supply Chain Manage. Rev., 4, 4, 52-57, (2000) |
| [11] | Lanbert, D. M.; Emmelhainz, M. A.; Gardner, T. J., Development and implementing supply chain partnership, Int. J. Logistics Manage., 7, 2, 1-17, (1996) |
| [12] | Betts, M., Manage my inventory or else, Computerworld, 28, 5, 93-95, (1994) |
| [13] | Munson, C. L.; Rosenblatt, M. J.; Rosenblatt, Z., The use and abuse of power in supply chains, Bus. Horiz., 21, 1, 55-65, (1999) |
| [14] | Poirier, C. C., Advanced supply chain management, (1999), Berrett-Kohler San Francisco, CA |
| [15] | Simatupang, T. M.; Wright, A. G.; Sridharan, R., Applying the theory of constraints to supply chain collaboration, Supply Chain Manage.: An Int. J., 9, 1, 57-70, (2004) |
| [16] | Goldratt, E. M., Theory of constraints, (1990), North River Press Croton-on-Hudson, NY |
| [17] | Blackstone, J. H., Theory of constraints - a status report, Int. J. Prod. Res., 39, 6, 1053-1080, (2001) · Zbl 1009.90034 |
| [18] | Ehie, I.; Sheu, C., Integrating six sigma and theory of constraints for continuous improvement: a case study, J. Manuf. Technol. Manage., 16, 5, 542-553, (2005) |
| [19] | Lea, B. R., Management accounting in ERP integrated MRP and TOC environments, Ind. Manage. Data Syst., 107, 8, 1188-1211, (2007) |
| [20] | Lubitsh, G.; Doyle, C.; Valentine, J., The impact of theory of constraints (TOC) in an NHS trust, J. Manage. Dev., 24, 2, 116-131, (2005) |
| [21] | Mabin, V. J.; Balderstone, S. J., The performance of the theory constraints methodology - analysis and discussion of successful TOC applications, Int. J. Oper. Prod. Manage., 23, 6, 568-595, (2003) |
| [22] | Mehra, S.; Inman, R. A.; Tuite, G., A simulation-based comparison of TOC and traditional accounting performance measures in a process industry, J. Manuf. Technol. Manage., 16, 3, 328-342, (2005) |
| [23] | Pegels, C. C.; Watrous, C., Application of the theory of constraints to a bottleneck operation in a manufacturing plant, J. Manuf. Technol. Manage., 16, 3, 302-311, (2005) |
| [24] | Reid, R. A., Applying the TOC five-step focusing process in the service sector - a banking subsystem, Managing Service Qual., 17, 2, 209-234, (2007) |
| [25] | Cox, J. F.; Spencer, M. S., The constraints management handbook, (1998), Lucie Press Boca Raton, FL |
| [26] | Simatupang, T. M.; Hurley, S. F.; Evans, A. N., Revitalizing TQM efforts: a self-reflection diagnosis based on the theory of constraints, Manage. Decis., 35, 10, 746-752, (1997) |
| [27] | Jackson, G. C.; Low, J. T., Constraint management: a description and assessment, Int. J. Logistics Manage., 4, 2, 41-48, (1993) |
| [28] | Yuan, K. J.; Chang, S. H.; Li, R. K., Enhancement of theory of constraints replenishment using a novel generic buffer management procedure, Int. J. Prod. Res., 41, 4, 725-740, (2003) · Zbl 1176.90041 |
| [29] | Kaijun, L.; Yuxia, W., Research on inventory control policies for nonstationary demand based on TOC, Int. J. Comput. Intell. Syst., 3, Suppl. 01, 114-128, (2010) |
| [30] | Wu, H. H.; Tsai, S. H.; Tsai, C. H.; Tsai, R.; Liao, M. Y., A study of supply chain replenishment system of theory of constraints for thin film transistor liquid crystal display (TFT-LCD) plants, Afr. J. Bus. Manage., 5, 21, 8617-8633, (2011) |
| [31] | Watson, K.; Polito, T., Comparison of DRP and TOC financial performance within a multi-product, multi-echelon physical distribution environment, Int. J. Prod. Res., 41, 4, 741-765, (2003) · Zbl 1176.90038 |
| [32] | G. Hulten, L. Spencer, P. Domingos, Mining time-changing data streams, In KDD 2001, (2001). |
| [33] | D. Kifer, B.D. Shai, J. Gehrke, Detecting Change in Data Streams, Proceeding of the 30th VLDB conference, Toronto, Canada, 2004. |
| [34] | Basseville, M.; Nikiforov, I., Detection of abrupt changes: theory and applications, (1993), Prentice-Hall Englewood Cliffs, NJ · Zbl 1407.62012 |
| [35] | Page, E. S., Continuous inspection schemes, Biometrika, 41, 100-115, (1954) · Zbl 0056.38002 |
| [36] | Willsky, A. S.; Jones, H. L., A generalized likelihood ratio approach to detection and estimation of jumps in linear systems, IEEE Trans. Automat. Control, 21, 108-112, (1976) · Zbl 0316.93038 |
| [37] | Lai, T. L., Information bounds and quick detection of parameter changes in stochastic systems, IEEE Trans. Inf. Theory, 44, 2917-2929, (1998) · Zbl 0955.62084 |
| [38] | Tartakovsky, A.; Rozovskii, B.; Blazek, R.; Kim, H., Detection of intrusions in information systems by sequential change-point methods, Stat. Methodol., 3, 252-293, (2006) · Zbl 1248.94032 |
| [39] | Verdier, G.; Hilgert, N.; Vila, J. P., Adaptive threshold computation for CUSUM-type procedure in change detection and isolation problems, Comput. Stat. Data Anal., 52, 4161-4174, (2008) · Zbl 1452.62135 |
| [40] | Simchi-Levi, D.; Kaminsky, P.; Simchi-Levi, E., Designing & managing the supply chain: concepts, (2007), McGraw-Hill Strategies & Case Studies |
| [41] | Wald, A., Sequential tests of statistical hypotheses, Ann. Math. Stat., 16, 2, 117-186, (1945) · Zbl 0060.30207 |
| [42] | Kmenta, J., Elements of econometrics, (1986), Macmillan Publishing New York · Zbl 0935.62129 |
This reference list is based on information provided by the publisher or from digital mathematics libraries. Its items are heuristically matched to zbMATH identifiers and may contain data conversion errors. In some cases that data have been complemented/enhanced by data from zbMATH Open. This attempts to reflect the references listed in the original paper as accurately as possible without claiming completeness or a perfect matching.
