...taking in mind that the supplier has to combat the bullwhip effect. With the existence of the bullwhip effect, a supplier cannot make right forecasts and therefore has difficulties in planning its production and/or inventory control. This research shows that information sharing is the key solution to reduce or avoid the bullwhip effect and, by that, it positively influences the performance of the supplier in the chain. Keywords: Bullwhip, supply chain, information sharing, supplier performance, inventory control, single-echelon, multi-echelon Thesis Circle: Time will tell…. A processes perspective on inter-organizational collaboration Supervisor: Remco Mannak Supervisor 2: Annemieke Stoppelenburg Name: PC Jansen ANR: 770926 E-mail: P.C.Jansen@uvt.nl 2 Table of contents Table of contents 3 1. Introduction 4 2. Theoretical Framework 7 2.1 Bullwhip effect 7 2.2 Information sharing 7 2.3 Performance of a supplier 9 3. Methodology 11 3.1 Operationalization 11 3.2 Data collection 11 3.3 Data analysis 12 3.2 Quality Indicators 12 4. Results 13 4.1 Information sharing is the key solution 13 4.1.1 Single-echelon supply chains 13 4.1.2 Multi-echelon supply...
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...Introduction Inventory serves as a useful purpose in the supply chain. Many supply chain managers say firms can help decrease the need for inventory by carefully managing factors that cause inventory levels to increase. Inventory can be defined as the result of imbalance between supply and demand. The term inventory drivers comes from the consequences of certain supply or demand characteristics, such as: product desirability, responsiveness, information, collaboration, and visibility (St. John, 2008). The four common inventory drivers are: 1) demand/ capacity mismatches; smoothing inventories 2) demand/ process volume mismatches; cycle stocks 3) demand/supply uncertainty; safety stocks and 4) demand/supply chain lead time mismatches; anticipation inventories (Bozarth, 2011). Determining Inventory Levels Inventory decisions are normally determined by five key business drivers: consumer demand, lead time variability, pack mix, merchandising requirements, and service levels. However, with every decision there is always an area for error. Forecasting consumer demand involves factoring in lead time, lead time variability, and package size constraints. The best way to manage customer demand is to run a sales and operating plan across merchandise, supply chain, and store operations to tweak forecasts and reduce forecast errors. The key is to do a monthly review of forecasts for items with a stable demand, and for items with unstable demand and promoted categories they need a more...
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...Current State * Merloni Elletrodomestici – domestic appliances- 75 % of sales of Merloni Group * Decentralized operations, plants for single product lines * Exports comprised 60% of total revenue of 626 billion lire in 1984 * Urban retail customers with high volumes used to keep some inventory. Small and rural retailers did not have much inventory and relied on company’s warehouses for fulfillment. * Delivery could be delayed to problems like those of over demand, production issues and climate conditions. * Direct supply for built in products to architects from the central warehouse, that provided 45% of revenues * Seasonal variation for products and 15% market share in Italy * Two plants and central warehouse in Central Italy, HQ in Fabriano, 17 regional warehouses (RW), 65% served through RW * Customers demanding FTL were served directly with 4,000 lire discount * FTL recd per week at regional warehouses ranged from 1 to 10 depending upon seasons and area served * Implementation of A (2 weeks) – B (4 weeks) – C (no inventory) system and performance bonuses resulted in 75% reduction in inventory levels and production planning reduced from 4 to 3 months. Benefits of Implementation: * Drastic reduction in warehouse and storage costs * Significant reduction in supply time to major retailers * Higher customer satisfaction levels * Reduced labor costs Risks Associated with Cross Docking: * Excess orders...
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...Teknologi Full paper Improving the Inventory Levels of a Blood Supply Chain Through System Dynamic Simulation Jafar Afshar*, Narjes Sadeghiamirshahidi, Ali Reza Firouzi, Seyed Mojib Zahraee, Syed Ahmad Helmi Syed Hassan Faculty of Mechanical Engineering, Department of Industrial Engineering, Universiti Teknologi Malaysia, 81310 UTM Johor Bahru, Johor, Malaysia *Corresponding author: amir_1065@yahoo.com Article history Abstract Received :1 January 2014 Received in revised form : 15 February 2014 Accepted :18 March 2014 The blood supply chain is a complex system with a multi-echelon structure. Hence, the integration of various interconnected elements, which should be synchronized appropriately, is a necessity to meet the patients’ requirements. The performance of the blood supply chain is a function of different variables that are dependent of each other. Therefore, the main aim of the chain is the optimization of the overall supply chain by considering the dynamic behavior of the system. The purpose of this study is to develop a system dynamic simulation model for a complex blood supply chain in order to improve the average level of inventories. The developed model is based on three echelons with a centrality on a regional blood center. The performance of the supply chain network in the current condition is investigated and based on the objectives, 17 scenarios were experimented for improving the average level of inventories to avoid outdates while there are...
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...is said to have an infinite set of solutions. We solve for any of the set by assigning one variable in the remaining two equations and then solving for the other two. For example, if we take y =3 Then: Then using the first row equation, we solve for x Characteristics of an Inconsistent System of Equations (underdetermined and overdetermined): * For a given set of variables, there is no set of solutions for the system of equations. * Arise when the lines or planes formed from the systems of equations don't meet at any point and are not parallel (all of them or only two and the third meets one of the planes at some point.) For example: Using matrix method we can solve the above as follows: Reducing the above to Row Echelon form can be done as follows: Adding row 2 to row...
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...Question #3 (a)Clearly T has a linear transformation Kernel of T is the set of all vectors | x1 | x2 | | | in R2 such that | (*) | T ( | x1 | x2 | | | ) = 0R2 | This yields the equation 1 x1 +1 x2 | 1 x1 +0x2 | | | = | 0 | 0 | | | The matrix equation above is equivalent to the following homogeneous system of equations 1 x1 | +1 x2 | = | 0 | 1 x1 | +0 x2 | = | 0 | | | We now transform the coefficient matrix of the homogeneous system above to the reduced row echelon form to determine the solution space. 1 | 1 | 1 | 0 | | can be transformed by a sequence of elementary row operations to the matrix 1 | 0 | 0 | 1 | | The reduced row echelon form of the augmented matrix is 1 | 0 | 0 | 1 | | which corresponds to the system 1 x1 | | = | 0 | | 1 x2 | = | 0 | The leading entries in the matrix have been highlighted in yellow. x1 | = | 0 | x2 | = | 0 | This means the kernel consists only of the zero vector, and consequently has no basis. Comments | * The nullity of T is 0. This is the dimension of the kernel of L. * T is a one-to-one transformation since ker T = {0R2}. * T is not a one-to-one onto ransformation.Question #1 T=R3 _ R3T(x)=A(x) A X 1 2 1 | 1 -1 12 1 1 | | | X | 2 | 1-4 | | | 0 | -31 | | | | | | Question # 2References http://www.calcul.com/http://www...
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...| An Introduction to Cribbing Isomophs, Gaussian Elimination and The Hidden Markov Model | | Abstract While looking into cryptography and the building blocks that make up ciphers and theory, a mix of time and effort has produced concrete methods of cryptanalysis to identify the temporal pattern recognitions and algorithms necessary to decrypt cipher-text back to its plaintext root. This paper will look at the process of cribbing isomorphs to reveal the plaintext message, Gaussian Elimination and the process of back substitution, and the Hidden Markov Model to view visible output to that which was once hidden. Table of Contents Introduction 2 Cribbing Isomorphs 3 The Hidden Markov Model 4 Gaussian Elimination 5 Conclusion 6 Introduction In any cryptanalysts toolbox, there are a number of methods at their dispense which can aid in the deciphering of crypto-text messages back into their native plaintext message. Since the dawn of man, ways have been invented to hide secret information in an attempt to keep secret an intent, hide a plan, cover up a bad deed or whisper softly over distances. Encryption has proven the means to get this data over a medium and ensure that the integrity of the message arrives intact. Many times this information is intercepted and then the deciphering process begins. By knowing a certain amount about a message, cryptanalysts are able to piece the remaining message together by using cribbing, algorithms and back substitution...
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...Inventory Management UNIT 17 Objectives INVENTORY MANAGEMENT Upon completion of this unit, you should be able to: understand the meaning of inventory and identify inventory related cost parameters learn about various types of inventory policies appreciate the role of selective inventory management know the exchange curve concept for aggregate inventory planning get a feel of some mathematical models of inventory analysis perform sensitivity analysis on a type of model compute safety stocks understand the problems of slow moving items appreciate the role of computers in inventory control have a brief idea about recent developments in inventory management. Structures 17.1 17.2 17.3 17.4 17.5 17.6 17.7 17.8 17.9 17.10 17.11 17.12 17.13 17.14 Introduction to Inventory Systems Functions of Inventory Classification of Inventory Systems Selective Inventory Management Exchange Curve and Aggregate Inventory Planning Deterministic Inventory Models Probabilistic Inventory Models Inventory Control of Slow Moving Items Recent Developments in Inventory Management Concluding Remarks Summary Key Words Self-assessment Exercises Further Readings 17.1 INTRODUCTION TO INVENTORY SYSTEMS Concept of Inventory . Inventory' may be defined as usable but idle resource'. If resource is some physical and tangible object such as materials, then it is generally termed as stock. Thus stock or inventory are synonymous terms though inventory has wider implications. Broadly speaking, the problem of...
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...5 Supply Chain Management Based on Modeling & Simulation: State of the Art and Application Examples in Inventory and Warehouse Management Francesco Longo Modeling & Simulation Center – Laboratory of Enterprise Solutions (MSC-LES) Mechanical Department, University of Calabria Via P. Bucci, Cubo 44C, third floor, 87036 Rende (CS) Italy 1. Introduction The business globalization has transformed the modern companies from independent entities to extended enterprises that strongly cooperate with all supply chain actors. Nowadays supply chains involve multiple actors, multiple flows of items, information and finances. Each supply chain node has its own customers, suppliers and inventory management strategies, demand arrival process and demand forecast methods, items mixture and dedicated internal resources. In this context, each supply chain manager aims to reach the key objective of an efficient supply chain: ‘the right quantity at the right time and in the right place’. To this end, each supply chain node (suppliers, manufacturers, distribution centers, warehouses, stores, etc.) carries out various processes and activities for guarantying goods and services to final customers. The competitiveness of each supply chain actor depends by its capability to activate and manage change processes, in correspondence of optimistic and pessimistic scenarios, to quickly capitalize the chances given by market. Such capability is a critical issue for improving the performance of the ‘extended...
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...More precisely, warehouse management involves the receipt, storage and movement of goods, (normally finished goods), to intermediate storage locations or to a final customer. In the multi-echelon model for distribution, there may be multiple levels of warehouses. This includes a central warehouse, a regional warehouses (serviced by the central warehouse) and potentially retail warehouses (serviced by the regional warehouses). Warehouse management systems often utilize automatic identification and data capture technology, such as barcode scanners, mobile computers, wireless LANs and potentially radio-frequency identification (RFID) to efficiently monitor the flow of products. Once data has been collected, there is either a batch synchronization with, or a real-time wireless transmission to a central database. The database can then provide useful reports about the status of goods in the warehouse. Warehouse design and process design within the warehouse (e.g. wave picking) is also part of warehouse management. Warehouse management is an aspect of logistics and supply chain management. Contents * 1 Objective * 2 Types * 3 See also * 4 References | Objective The objective of a warehouse management system is to provide a set of computerized procedures for management of warehouse inventory with the goal of maximizing...
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...a new product introduction, or unexpectedly high demand could create product shortages at the central warehouse; a transportation equipment failure or adverse weather conditions could delay product delivery to regional warehouses (e.9., snow could cause the central warehouse and regional warehouses in northern Italy to close, while regional warehouses in southern areas of the country would remain open for business, in some cases stocking out of product). From time to time, both the regional warehouses and the central warehouse would be out of stock of a particular item. When this happened, the impact on smaller retail customers, who generally had little or no stock of their own from which to satisfy their customers' needs, was typically greater than on larger retailers. Built-in appliance products were generally sold directly to architects and developers to be incorporated into new dwellings. No built-in appliance stock was distributed through Merloni's regional warehouse facilities. Customers in this channel, generally more sophisticated and ordering in higher volumes than retail customers, ordered directly from the central warehouse in Fabriano. The built-in market represented 45% of Merloni Elettrodomestici's business. The company aimed to give its built-in customers a high level of service. Merloni Elettrodomestici's appliance sales were subject to wide seasonal fluctuation. Exhibit 6 shows monthly sales levels for the company's product lines. In 1984, Merloni...
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...between service and inventory costs Rationalizing safety stock settings within NXP Semiconductors by M.W.H. Roeloffzen Trade-off between service and inventory costs Rationalizing safety stock settings within NXP Semiconductors Graduation Company: NXP Semiconductors SCM Competence Center High Tech Campus – 60 (5.50) Professor Holstlaan 4 P.O. Box 80073 5600 K.A. Eindhoven The Netherlands University Supervisors: Dr. Ir. Leo van der Wegen (UT) Prof. Dr. Ir. Ton de Kok (TU/e) (Dr. Ir. Matthieu van der Heijden (UT)) Company Supervisors: Ir. Sander Kok Ir. Ruud Driesen Ir. Erik van Wachem University of Twente, Enschede Industrial Engineering and Management Science Specialization: Production and Logistic Management Mark W.H. Roeloffzen October 9th, 2007. Summary Summary ----------Context NXP operates in a highly dynamic and globalized semiconductor market. The NXP supply chain control is like it peers in semiconductor business quite complex. To manage the supply chain and to deal with the market characteristics, six so called Business Renewal II objectives were launched as part of the one page strategy. On one hand the BR II objectives target for a lower break-even point and on the other hand it aims for operational excellence. For supply chain management this translates in lower stock targets on one hand and better supply chain performance on the other hand. Because of the existing link between these two objectives, this research will support the inventory management project...
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...all was part of a dream, “to build a healthy community”. This dream can still be seen in the current vision: “Improve life”. To accomplish this vision the mission statement is: “develop, produce and market a broad range of reliable, natural and nutritious dairy products that should contribute to the well-being and vitality of life”. Supply chain management includes the planning and management of all activities involved in sourcing and procurement, conversion, and logistics management Supply chain is life blood of any business They connect suppliers, producers, and final customers into a network Inventory management is considering and controlling of the ordering, storage and use of components that a company will use in the production; also considering and controlling of quantities of finished products After looking into different companies’ supply chain and inventory control, we pick Dutch Lady for our project because it has supply chain from farm to consumers’ table. Dutch Lady is a well-known diary producer in Vietnam. Supply chain Procurement Procurement analysis Specialists compare prices from suppliers Contracts Choose the best both local and oversea suppliers for production Contract...
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...Journal of Emerging Trends in Economics and Management Sciences (JETEMS) 2 (2): 131-141 © Scholarlink Research Institute Journals, 2011 (ISSN: 2141-7024) jetems.scholarlinkresearch.org Journal of Emerging Trends in Economics and Management Sciences (JETEMS) 2(2):131-141(ISSN:2141-7024) Information Distortion in Supply Chain: A Simulation Approach to Quantifying the Bullwhip Effect 1 1 Oyatoye, E.O and 2Fabson, T.V.O Department of Business Administration University of Lagos, Akoka-Yaba, Lagos, Nigeria 2 Telsy Value Consult, Onike Road, Iwaya, Lagos, Nigeria Corresponding Author: Oyatoye, E.O ____________________________________________________________ ______________________________ Abstract Supply chain exists due to the fact that it is difficult for any company to provide all that is required from raw materials to final products and at the same time get the products to the end users. Successful supply chain management requires a change from managing individual functions to integrating activities into key supply chain process; hence, accurate information is of essence. One of the key factors that can adversely affect effective and efficient supply chain process is information distortion. Demand forecasting and ordering policies have been recognized as two key causes of bullwhip effect in supply chain management. This study explored the simulation approach in quantifying the effect of bullwhip in supply chain, using various forecasting methods. ____________________________________________________________ ...
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...Retailers 9 5. Summary 9 References 10 Appendix 12 List of Figures Figure 1: Order fluctuations in the beer supply chain 12 1. Introduction The US-American telecommunications company CISCO depreciated 2.25 million US dollars in the third quarter of 2001 due to excess stock (Beer, 2014, p. 1). According to Beer (2014, p. 3.) the bullwhip effect is the probably most important reason for this depreciation. The bullwhip effect affects production and leads to a shortage of stocks or excess stocks, drops in sales, increases inventory costs and instability of planning (Beer, 2014, p. 3). Productivity losses due to the bullwhip effect are between 10 and 30%, according to Beer (2014, p. 3). Thus, eliminating the bullwhip effect is one of the most important goals of supply chain management. Since the length of production chains has increased over the last decades, due to the implementation of cost-reducing outsourcing and since new inventory strategies are implemented to increase efficiency, the importance of overcoming the...
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