Production and Operation Managements Scheduling in Supply Chain Management Dr GeNG Na Department of Industrial Engineering Management Shanghai Jiao Tong University
Production and Operation Managements Dr GENG Na Department of Industrial Engineering & Management Shanghai Jiao Tong University Scheduling in Supply Chain Management
Scheduling in Supply Chain Management Contents 。Introduction Transportation Problem Generalizations of the Transportation; More General Network Formulations Distribution Resources Planning; Determining Delivery Routes in Supply Chain The Role of information in the SCM Multilevel Distribution Systems Designing the Supply Chain in a Global Environment
Scheduling in Supply Chain Management Contents • Introduction • Transportation Problem • Generalizations of the Transportation; • More General Network Formulations • Distribution Resources Planning; • Determining Delivery Routes in Supply Chain • The Role of information in the SCM • Multilevel Distribution Systems • Designing the Supply Chain in a Global Environment
Supply Chain What is Supply Chain? Tier 3 Tier 2 Tier 1 Suppliers Suppliers Suppliers Warehouse Customers 大鱼Big fish Store 小鱼 Small S3 fish 3 Factory Distribution Store Center 浮游生物 Plankton Information S2 Store 绿藻 alga 6 52 Factory Store Nitrogen S1 Warehouse Distribution Center 氨和磷 & phosphor Store Marine food chain Raw material Manufactu- Distributer Retailer Users supplier rer
Supply Chain What is Supply Chain? Nitrogen & phosphor alga Plankton Small fish Big fish Marine food chain Raw material supplier Manufacturer Distributer Retailer Users
Introduction The Definition of Supply Chain Management (SCM) Hau-Lee,the head of Stanford Supply Chain Forum (1999): SCM deal with the management of materials,information and financial flows in a network consisting of suppliers, manufacturers,distributors,and customers. ● Simchi-Levi et al.(1999,p1):SCM is a set of approaches utilized to efficiently integrate suppliers,manufactures, warehouses,and stores,so that merchandise is produced and distributed at the right quantities,to the right locations,and at right time,in order to minimize system wide costs while satisfying service level requirements
Introduction The Definition of Supply Chain Management (SCM) • Hau-Lee, the head of Stanford Supply Chain Forum (1999): SCM deal with the management of materials, information and financial flows in a network consisting of suppliers, manufacturers, distributors, and customers. • Simchi-Levi et al.(1999,p1): SCM is a set of approaches utilized to efficiently integrate suppliers, manufactures, warehouses, and stores, so that merchandise is produced and distributed at the right quantities, to the right locations, and at right time, in order to minimize system wide costs while satisfying service level requirements
Supply Chain Management The clearest description appeared in a Fortune magazine article devoted to the subject: Call it distribution or logistics or supply chain management.By whatever name,it is the sinuous,gritty,and cumbersome process by which companies move material,parts,and products to customers.In industry after industry,from cars and clothing to computers and chemicals,executives have plucked this once dismal discipline off the loading dock and placed it near the top of the corporate agenda.Hard-pressed to knock out competitors on quality or price,companies are trying to gain an edge through their ability to deliver the right stuff in the right amount at the right time. (Henkoff,1994)
Supply Chain Management The clearest description appeared in a Fortune magazine article devoted to the subject: Call it distribution or logistics or supply chain management. By whatever name, it is the sinuous, gritty, and cumbersome process by which companies move material, parts, and products to customers. In industry after industry, from cars and clothing to computers and chemicals, executives have plucked this once dismal discipline off the loading dock and placed it near the top of the corporate agenda. Hard-pressed to knock out competitors on quality or price, companies are trying to gain an edge through their ability to deliver the right stuff in the right amount at the right time. (Henkoff, 1994)
Introduction The Supply Chain as a Strategy Weapon The design of supply chain reflects a firm's strategic positioning;(low cost /fast response) Supply chain trade off between cost and response time; Third party logistic (3PL)is becoming more common Less expensive to subcontract logistics than to do it in- house. Maintain core competency SCM make it possible to move product quickly and efficiently so as to gain an edge over their competitors;(Outsourcing) New technologies will trim costs from the supply chain without compromising service
Introduction The Supply Chain as a Strategy Weapon • The design of supply chain reflects a firm’s strategic positioning; (low cost /fast response) • Supply chain trade off between cost and response time; • Third party logistic (3PL) is becoming more common Less expensive to subcontract logistics than to do it inhouse. Maintain core competency • SCM make it possible to move product quickly and efficiently so as to gain an edge over their competitors; (Outsourcing) • New technologies will trim costs from the supply chain without compromising service
Scheduling in Supply Chain Management Contents ·Introduction Transportation Problem 。 Generalizations of the Transportation; More General Network Formulations Distribution Resources Planning; Determining Delivery Routes in Supply Chain The Role of information in the SCM Multilevel Distribution Systems Designing the Supply Chain in a Global Environment
Scheduling in Supply Chain Management Contents • Introduction • Transportation Problem • Generalizations of the Transportation; • More General Network Formulations • Distribution Resources Planning; • Determining Delivery Routes in Supply Chain • The Role of information in the SCM • Multilevel Distribution Systems • Designing the Supply Chain in a Global Environment
Transportation Problem The transportation problem is a mathematical model for optimally scheduling the flow of goods from production factories to distribution centers. The transportation problem can be viewed as prototype supply chain problem Example 6.1 The Pear Disk Corp.produces 80GB drives in three plants and supply four distribution centers.The production capacities for the three factories in the next month are 45,000,120,000,and 95,000. The amounts shipped to the four DCs.are 80,000,78,000,47,000, and 55,000.The unit cost for shipping 1,000 units drives from each plant to each warehouse is given.The goal is to determine a pattern of shipping that minimize the total transportation costs
Transportation Problem • The transportation problem is a mathematical model for optimally scheduling the flow of goods from production factories to distribution centers. • The transportation problem can be viewed as prototype supply chain problem Example 6.1 The Pear Disk Corp. produces 80GB drives in three plants and supply four distribution centers. The production capacities for the three factories in the next month are 45,000, 120,000, and 95,000. The amounts shipped to the four DCs. are 80,000, 78,000, 47,000, and 55,000. The unit cost for shipping 1,000 units drives from each plant to each warehouse is given. The goal is to determine a pattern of shipping that minimize the total transportation costs
Transportation Problem Plants Warehouses 45 80 250 量日己 420 四L四 Sunnyvale 380 Amarillo 280 78 1280 回回a 120 990 ▣▣ Teaneck 1440 47 Dublin 1520 回回后 1550420 s▣ Chicago 1660 95 55 面回正云 1730 a▣ Bangkok Sioux Falls Fig.6-2 Pear Disk Drive Transportation Problem
Transportation Problem Fig.6-2 Pear Disk Drive Transportation Problem 80 78 47 55 45 120 95 250 420 380 280 1280 990 1440 1520 1550 1420 1660 1730
Transportation Problem Solve TP by Greedy Heuristic:sub-optimal The total cost- 45×250+35×,1280+ Min(45,80) Min(78,120) .=S304,900, Factories Warehouse (Sinks) Amarillo Teaneck Chicago Siouk Falls (sources) 250 420 380 280 Sunnyvale 5 45 1,280 990 1,440 1,520 Dublin 35 78 120 1,550 1,420 1,660 1,730 Bangkok 40 5 95 80 78 47 55 Min(80-45,120-78) Min(120-35-78,47) Min(47-7,95)
Solve TP by Greedy Heuristic: sub-optimal Transportation Problem Amarillo Teaneck Chicago Sioux Falls Warehouse (Sinks) Factories (sources) Sunnyvale Dublin Bangkok 250 420 380 280 1,280 990 1,440 1,520 1,550 1,420 1,660 1,730 45 120 95 80 78 47 55 55 45 Min (45, 80) 78 Min (78, 120) 35 Min (80-45, 120-78) 7 Min (120-35-78, 47) 40 Min(47-7, 95) The total cost= 45 250+35 ,1280+ …=$304,900