Inventory control policies have been recognized as a contributory factor to the bullwhip effect and inventory instability. Previous studies have indicated that there is a trade-off between bullwhip effect and inventory performance where the bullwhip effect reduction might increase inventory instability. Therefore, there is a need for inventory control policies that can cope with supply chain dynamics. This paper proposes an inventory control policy based on a statistical process control approach (SPC) to handle supply chain dynamics. The policy relies on applying individual control charts to control both the inventory position and the placed orders adequately. A simulation study has been conducted to evaluate and compare the proposed SPC policy with a traditional order-up-to in a multi-echelon supply chain. The comparison showed that the SPC policy outperforms the order-up-to in terms of bullwhip effect and inventory performances. The SPC succeeded to eliminate the bullwhip effect whilst keeping a competitive inventory performance.
Spc-based inventory control policy to im-prove supply chain dynamics / Costantino, Francesco; DI GRAVIO, Giulio; SHABAN SHABAN KHALIFA, Ahmed; Tronci, Massimo. - In: INTERNATIONAL JOURNAL OF ENIGNEERING AND TECHNOLOGY. - ISSN 2319-8613. - 6:1(2014), pp. 418-426.
Spc-based inventory control policy to im-prove supply chain dynamics
COSTANTINO, francesco;DI GRAVIO, GIULIO;SHABAN SHABAN KHALIFA, AHMED;TRONCI, Massimo
2014
Abstract
Inventory control policies have been recognized as a contributory factor to the bullwhip effect and inventory instability. Previous studies have indicated that there is a trade-off between bullwhip effect and inventory performance where the bullwhip effect reduction might increase inventory instability. Therefore, there is a need for inventory control policies that can cope with supply chain dynamics. This paper proposes an inventory control policy based on a statistical process control approach (SPC) to handle supply chain dynamics. The policy relies on applying individual control charts to control both the inventory position and the placed orders adequately. A simulation study has been conducted to evaluate and compare the proposed SPC policy with a traditional order-up-to in a multi-echelon supply chain. The comparison showed that the SPC policy outperforms the order-up-to in terms of bullwhip effect and inventory performances. The SPC succeeded to eliminate the bullwhip effect whilst keeping a competitive inventory performance.File | Dimensione | Formato | |
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