SUPPLY CHAIN MANAGEMENT Edited by Pengzhong Li Supply Chain Management Edited by Pengzhong Li Published by InTech Janeza Trdine 9, 51000 Rijeka, Croatia Copyright © 2011 InTech All chapters are Open Access articles distributed under the Creative Commons Non Commercial Share Alike Attribution 3.0 license, which permits to copy, distribute, transmit, and adapt the work in any medium, so long as the original work is properly cited. After this work has been published by InTech, authors have the right to republish it, in whole or part, in any publication of which they are the author, and to make other personal use of the work. Any republication, referencing or personal use of the work must explicitly identify the original source. Statements and opinions expressed in the chapters are these of the individual contributors and not necessarily those of the editors or publisher. No responsibility is accepted for the accuracy of information contained in the published articles. The publisher assumes no responsibility for any damage or injury to persons or property arising out of the use of any materials, instructions, methods or ideas contained in the book. Publishing Process Manager Iva Lipovic Technical Editor Teodora Smiljanic Cover Designer Martina Sirotic Image Copyright Pindyurin Vasily, 2010. Used under license from Shutterstock.com First published March, 2011 Printed in India A free online edition of this book is available at www.intechopen.com Additional hard copies can be obtained from orders@intechweb.org Supply Chain Management, Edited by Pengzhong Li p. cm. ISBN 978-953-307-184-8 free online editions of InTech Books and Journals can be found at www.intechopen.com Part 1 Chapter 1 Chapter 2 Chapter 3 Chapter 4 Chapter 5 Chapter 6 Chapter 7 Chapter 8 Preface IX Management Method and Its Application 1 Supply Chain Optimization: Centralized vs Decentralized Planning and Scheduling 3 Georgios K.D. Saharidis Integrating Lean, Agile, Resilience and Green Paradigms in Supply Chain Management (LARG_SCM) 27 Helena Carvalho and V. Cruz-Machado A Hybrid Fuzzy Approach to Bullwhip Effect in Supply Chain Networks 49 Hakan Tozan and Ozalp Vayvay Managing and Controlling Public Sector Supply Chains 73 Intaher Marcus Ambe and Johanna A Badenhorst-Weiss Supply Chain Management Based on Modeling & Simulation: State of the Art and Application Examples in Inventory and Warehouse Management 93 Francesco Longo Supply Chain Process Benchmarking Using a Self-Assessment Maturity Grid 145 Sander de Leeuw Supply Chain Resilience Using the Mapping Approach 161 A.P. Barroso, V.H. Machado and V. Cruz Machado Capacity Collaboration in Semiconductor Supply Chain with Failure Risk and Long-term Profit 185 Guanghua Han, Shuyu Sun and Ming Dong Contents Contents VI A Cost-based Model for Risk Management in RFID-Enabled Supply Chain Applications 201 Manmeet Mahinderjit-Singh, Xue Li and Zhanhuai Li Inventories, Financial Metrics, Profits, and Stock Returns in Supply Chain Management 237 Carlos Omar Trejo-Pech, Abraham Mendoza and Richard N. Weldon Differential Game for Environmental-Regulation in Green Supply Chain 261 Yenming J Chen and Jiuh-Biing Sheu Logistics Strategies to Facilitate Long-Distance Just-in-Time Supply Chain System 275 Liang-Chieh (Victor) Cheng Governance Mode in Reverse Logistics: A Research Framework 291 Qing Lu, Mark Goh and Robert De Souza Supply Chain Management and Automatic Identification Management Convergence: Experiences in the Pharmaceutical Scenario 303 U. Barchetti, A. Bucciero, A. L. Guido, L. Mainetti and L. Patrono Coordination 329 Strategic Fit in Supply Chain Management: A Coordination Perspective 331 S. Kamal Chaharsooghi and Jafar Heydari Towards Improving Supply Chain Coordination through Business Process Reengineering 351 Marinko Maslaric and Ales Groznik Integrated Revenue Sharing Contracts to Coordinate a Multi-Period Three-Echelon Supply Chain 367 Mei-Shiang Chang The Impact of Demand Information Sharing on the Supply Chain Stability 389 Jing Wang and Ling Tang Modeling and Analysis 415 Complexity in Supply Chains: A New Approachto Quantitative Measurement of the Supply-Chain-Complexity 417 Filiz Isik Chapter 9 Chapter 10 Chapter 11 Chapter 12 Chapter 13 Chapter 14 Part 2 Chapter 15 Chapter 16 Chapter 17 Chapter 18 Part 3 Chapter 19 Contents VII A Multi-Agent Model for Supply Chain Ordering Management: An Application to the Beer Game 433 Mohammad Hossein Fazel Zarandi, Mohammad Hassan Anssari, Milad Avazbeigi and Ali Mohaghar A Collaborative Vendor – Buyer Deteriorating Inventory Model for Optimal Pricing, Shipment and Payment Policy with Two – Part Trade Credit 443 Nita H. Shah and Kunal T. Shukla Quantifying the Demand Fulfillment Capability of a Manufacturing Organization 469 César Martínez-Olvera Continuum-Discrete Models for Supply Chains and Networks 487 Ciro D’Apice, Rosanna Manzo and Benedetto Piccoli Services and Support Supply Chain Design for Complex Engineering Systems 515 John P.T. Mo Lifecycle Based Distributed Cooperative Service Supply Chain for Complex Product 533 Pengzhong Li, Rongxin Gu and Weimin Zhang A Generalized Algebraic Model for Optimizing Inventory Decisions in a Centralized or Decentralized Three-Stage Multi-Firm Supply Chain with Complete Backorders for Some Retailers 547 Kit Nam Francis Leung Life Cycle Costing, a View of Potential Applications: from Cost Management Tool to Eco-Efficiency Measurement 569 Francesco Testa, Fabio Iraldo, Marco Frey and Ryan O’Connor Chapter 20 Chapter 21 Chapter 22 Chapter 23 Chapter 24 Chapter 25 Chapter 26 Chapter 27 Pref ac e With gradually recognized signifi cance of supply chain management, it a racts ex- tensive a ention from businesses and academic scholars. Many important research fi ndings and results had been achieved. This book presents a collection of recent con- tributions from the worldwide researchers in the fi eld of supply chain management. It is aimed at providing new ideas, original results and practical experiences regarding this highly up-to-date area. Research work of supply chain management involves all activities and processes in- cluding planning, coordination, operation, control and optimization of the whole sup- ply chain system. To make it convenient for readers to fi nd interesting topics, content of this book was structured into three technical research parts with total of 27 chapters wri en by well recognized researchers worldwide. In part one, Management Method and Its Application, the editor hopes to give readers new methods and innovative ideas about supply chain management. Chapters about supply chain coordination were put into part two, Coordination. The third part, Modeling and Analysis, is thematically more diverse, it covers accepted works about description and analysis of all supply chain management areas. I am very honored to be editing such a valuable book, which contains contributions of a selected group of researchers presenting the best of their work. The editor truly hopes the book will be helpful for researchers, scientists, engineers and students who are involved in supply chain management. Although it represents only a small sample of the research activity on supply chain management, the book will certainly serve as a valuable tool for researchers interested in ge ing involved in this multidisciplinary fi eld. Further discussions on the contents of this book are warmly welcome. Finally, the editor would like to thank all the people who contributed to this book, in particular Ms. Iva Lipovic, for indispensable technical assistance in book publishing. Pengzhong LI Sino-German College of Postgraduate Studies (CDHK) Tongji University Shanghai 200092, China [...]... B2: μ1P(0, B2) = μ2P (1, B2 − 1) (λ + 1) P(I1, B2) = μ1P(I1 − 1, B2) + μ2P(I1 + 1, B2 − 1) , 1 ≤ I1 ≤ B1 − 1, λP(B1, B2) = μ1P(B1 − 1, B2) B2 > I2 > −C: (λ + 1 + μ2)P (1, I2) = μ2[P (1, I2 − 1) + P(2, I2 − 1) ] + λP (1, I2 + 1) 22 Supply Chain Management (λ + 1 + μ2)P(I1, I2) = μ1P(I1 − 1, I2) + μ2P(I1 + 1, I2 − 1) + λP(I1, I2 + 1) , 2 ≤ I1 ≤ B1 − 1, (λ + μ2)P(B1, I2) = μ1P(B1 − 1, I2) + λP(B1, I2 + 1) I2... 1 1, B2 1 λ μ2 1 … 2, B2 1 λ λ μ2 λ λ λ … μ2 1 1 1, −C +1 μ2 λ 2, −C +1 μ2 λ 1 1, −C 2, −C 1 B1 1, B2 1 1 2, −C+2 μ2 λ B1, B2 μ2 λ B1, B2 1 μ2 1 1, −C+2 1 B1 1, B2 μ2 μ2 μ2 … … μ2 1 … λ 1 B1 1, −C+2 λ B1, −C+2 μ2 1 B1 1, −C +1 λ B1 1, −C λ B1, −C +1 μ2 1 λ B1, −C Fig 5 Markov chain of the supply chain under BSPB The Chapman-Kolmogorov equations for the equilibrium probabilities P(I1,... B2, I1 Supply Chain Optimization: Centralized vs Decentralized Planning and Scheduling 23 takes on values from the set {0, 1, …, E1 − B2}; in all other cases, i.e I2 = B2 − 1, …, 0, …, −C, we have I1 = 1, 2, …, E1 − I2 1 0, B2 … 1, B2 μ2 μ2 λ 1 E1 −B2, B2 … 1 1, B2 1 … μ2 λ E1 −B2, B2 1 μ2 λ λ λ 1, −C E1−B2 +1, B2 1 μ2 μ2 μ2 1 … 1 1 1 E1 −B2, −C E1−B2 +1, −C … E1 + C, −C Fig 6 Markov chain. .. ( 1 + μ2)P (1, −C) = λP (1, −C + 1) ( 1 + μ2)P(I1, −C) = μ1P(I1 − 1, −C) + λP(I1, −C + 1) , 2 ≤ I1 ≤ B1 − 1, μ2P(B1, −C) = μ1P(B1 − 1, −C) + λP(B1, −C + 1) We solve the first of the equations given above for P(0, B2) = (μ2/ 1) P (1, B2 − 1) We define the column vectors PI2 = [P (1, I2) … P(B1, I2)]T for I2 = B2, B2 − 1, …, −C The ChapmanKolmogorov equations can be written more compactly as: A1PB2 = H1PB2 1. .. + 1, …, B2 From the equilibrium probabilities we can compute all the terms of equations (60)−(62) We have: THi = μiαi, THSC2 = λ − TH2, THSC1 = TH2 − TH1, 1 = P(I1 < B1) = 1 − E(I1) = B1 −C I1 = 1 I2 =1 ∑ I1 ∑ B2 ∑ I 2 =−C P(B1 , I 2 ) , α2 = P(I2 < B2) = 1 − P(I 1 , I 2 ) , E[max(−I2, 0)] = − E[max(I2, 0)] = B2P(0, B2) + B2 ⎡ B1 ∑ I1 = 0 P(I 1 , B2 ) , ⎡ B1 ⎤ ⎢ I 2 ∑ P(I 1 , I 2 )⎥ , I 2 = 1 ⎢ I 1. .. = DI2PI2 1, where DI2 = (A − GDI2 +1) 1 and I2 = B2 − 1, B2 − 2, …, −C + 1, c) next, we substitute P−C +1 = D−C+1P−C into equation (65) and compute P−C using the normalization condition P(0, B2) + B1 B2 ∑ ∑ I 1 = 1 I 2 =−C P(I 1 ,I 2 ) = (μ2/ 1) P (1, B2 − 1) + B1 B2 ∑ ∑ I 1 = 1 I 2 =−C P(I 1 ,I 2 ) = 1, and d) finally, we compute the remaining probability vectors recursively from PI2 = DI2PI2 1, for I2... with partial backordering: Factory F1 is working when I1 < B1 Hence, a transition from state (I1, I2) to state (I1 + 1, I2) occurs with rate 1, but these transitions are disabled in states (B1, I2) A transition from state (I1, I2) to (I1 − 1, I2 + 1) occurs with rate μ2 whenever I2 < B2 When I1 = 1, F2 is working on one item and buffer 1 is empty; in this case, if this item is produced before F1 sends... performance measures for the individual factories and the whole system The mean profit rate Ji of Fi, i = 1, 2, and the overall profit rate J of the system are given by: 20 Supply Chain Management J1 = (p1 − c1)TH1 + (p1 − sc1)THSC1 − h1H1 (60) J2 = (p2 − c2 − p1)TH2 + (p2 − sc2)THSC2 − h2H2 − bB ( 61) J = J1 + J2 (62) In equations (57) and (58), the terms involving the throughput rates THi and THSCi represent... = cp1 ∑ P1,t + h1 ∑ I 1, t + csc1 ∑ SC 1, t (12 ) subject to balance equations: I 1, t = I 1, t − 1 + P1,t + SC 1, t − P2,t − SC 2,t , ∀t (13 ) I 1, t = 0 (14 ) P2,t ≤ production capacity of factory 2 during period t , ∀t (15 ) P1,T = 0 (16 ) and production capacity: 3.3 Qualitative results We have used these two models to explore certain qualitative behavior of our supply chain First of all we proved that the... (31L'-31G ') and (31G '-31L') and using ( 51) we prove (50) 17 Supply Chain Optimization: Centralized vs Decentralized Planning and Scheduling Proof of ( 51) : In general only one unit j produces a product s Thus, in constraints (33) only one of the two parts exists because a product s is produced by a unique unit or is unloaded from a tank or sum of tanks ∑ jst∈JSTs , n outflow1 jst ,n ≥ rs s ∈ {11 ,12 ,13 } . 11 ,11 , 1 1, 11 1 Z csc TT T tt t tt t M in cp P h I SC == = =++ ∑∑ ∑ (12 ) subject to balance equations: 1, 1, 1 1, 1, 2, 2,tt t tt t II PSCPSC − = ++ −− , t ∀ (13 ) 1, 0 t I = (14 ). Measurement of the Supply- Chain- Complexity 417 Filiz Isik Chapter 9 Chapter 10 Chapter 11 Chapter 12 Chapter 13 Chapter 14 Part 2 Chapter 15 Chapter 16 Chapter 17 Chapter 18 Part 3 Chapter 19 Contents VII A. 222,222,22 11 1 Z (csc ) (csc ) TT T tt t tt t Min cp d h I cp SC cp == = ′′′′′ = ++− ⇒−=Δ ∑∑ ∑ 222,22, 11 1 Z TT T tt t tt t M in cp d h I SC == = ′ =++Δ ∑∑ ∑ (24) Supply Chain Management 10