Design of supply chain networks,

Hugo, A. and Pistikopoulos, E. N. (2005). Environmentally conscious long-range planning and design of supply chain networks, J. Clean. Prod, 13, pp. 1471-1491. 

Most companies inherited their supply chains. The active design of supply chain networks is relatively new. fn the first 20 years, the placement of factories, the design of distribution centers, and the selection of suppliers were not critical. Today, the design is paramonnt. 

Cakravastia, A., Toha, I. S., Nakamura, N. (2002). A two-stage model for the design of supply chain networks. International Journal of Production Economics, 80, 231-248. 

Longinidis, P., Georgiadis, M. (2011). Integration of financial statement analysis in the optimal design of supply chain networks under uncertainty. Intematiorud Journal of Production Economics, 129, 262-276. 

Within these value chains, change happens frequently. Relationships come and go. The value chain is characterized by the number of nodes in the network, the number and type of constraints, the variability of demand and supply, the rhythms and cycles of decisions, the products and shipments, and the latency of information. Five years ago, the design of supply chains and value networks was an ad hoc process. Today, over 35 percent of companies have planning teams to rationalize the design and refine the network for current conditions. In our interviews, we learned that these teams are growing in both size and importance. 

Next, we discuss an important aspect of supply chain network design, called Risk Pooling. Risk pooling refers to the use of a more consolidated distribution network with fewer facilities, each serving a large allocation of customer demand. A consolidated distribution system reduces supply chain costs—inventory holding cost (IHC), order costs, and facilities cost. However, customer service suffers, as time to fulfill customer demand increases. We will study the tradeoff between supply chain cost and customer service under risk pooling. 

The optimization models discussed in this chapter had a single objective— either to minimize supply chain costs or to maximize supply chain profitability, in case the product prices vary by location or customer. However, customer demand fulfillment and service are also important in designing a supply chain network. More recently, supply chain risk is emerging to be another important criterion (Supply chain risk is discussed in detail in Chapter 7). Hence, recent applications of optimization models have used multiple criteria optimization models for decision making. 

We will use RvaR( ) and RmitC ) this section to denote the combined risk values. Note that the term "supplier" could be easily replaced by "geographic region" in the context of supply chain network design optimization, where risk can be explicitly included as part of the criteria functions for locating plants and warehouses. 

Lambiase A, Mastrocinque E, Miranda S, Lambiase A (2013) Strategic planning and design of supply chains a literature review. Int J Eng Bus Manag 5 1-11 Latha Shankar B, Basavarajappa S, Chen JCH, Kadadevaramath RS (2013) Location and allocation decisions for multi-echelon supply chain network - A multi-objective evolutiemary approach. Expert Syst Appl 40 551-562... 

A System-of-Systems Approach is needed to design complex supply chain networks. This is especially trae as supply chains assume global proportions, whereby the number of entities and their relationships multiply disproportionately. It also... 

Network design in supply chains deals with the selection of the best location for the facilities in the supply chain network, numbers and capacities of facilities, and optimal product flows through the selected set of facilities (Melo et al. 2009 Subramanian and Ravindran 2014). Due to increased globalization of the firms operations, supply chains have become more vulnerable to disruptions (Kungwalsong 2013 Subramanian and Ravindran 2014). Thus, supply chain disruption has become an important consideration while designing a supply chain network. 

This section discusses some managerial implications for the study. The model can be used by companies to design their supply chain network considering supplier density. From the numerical example, the model tends to select a fewer number of... 

Rienkhemaniyom K, Subramanian P (2015) Resiliency analysis of supply chain network design. Working paper. King Mongkut s University of Technology Thonburi, Bangkok, Thailand... 

A multi-national company wants to design a supply chain network for new products. A set of potential suppliers, plant locations, EXZs, and transportation links are available hence, the decisions focus on network structure and distribution planning. 

The focus of the book is on the design and operation of the supply chain system, which involves connecting many production and distribution systems, often across wide geographic distances, in such a way that the businesses involved can ultimately satisfy consumer demand as efficiently as possible, resulting in maximum financial returns to those businesses connected to that supply chain system. The book includes several case studies on the design and operation of supply chain networks in manufacturing and healthcare. 

Chapter 7 incorporates disruption risk in a supply chain network design model. Supply chain network design decisions that determine the number and location of facilities and the selection of transportation modes have a significant impact on competitive performance. However, facilities and transportation links are susceptible to disruptions. In addition, they have different capacities to cope with those disruptions, which contribute to supply chain resilience. This chapter provides a framework to quantify the risk level of supply chain nodes and links. Then, a multiple objective optimization model is presented for designing a resilient supply chain network, with an emphasis on balancing the cost, responsiveness, and risk of the supply chain. 

In this chapter, we start with the broad supply chain design discussed in Chapter 4 and focus on the fundamental questions of facility location, capacity allocation, and market allocation when designing a supply chain network. We identify and discuss the various factors that influence the facility location, capacity, and market allocation decisions. We then establish a framework and discuss various solution methodologies for network design decisions in a supply chain. 

Macroeconomic factors include taxes, tariffs, exchange rates, and shipping costs that are not internal to an individnal firm. As global trade has increased, macroeconomic factors have had a significant influence on the success or failure of supply chain networks. Thus, it is imperative that firms take these factors into account when making network design decisions. 

Companies must consider competitors strategy, size, and location when designing their supply chain networks. A fundamental decision firms make is whether to locate their facilities close to or far from competitors. The form of competition and factors such as raw material or labor availability influence this decision. 

Logistics and facility costs incurred within a supply chain change as the number of facilities, their location, and capacity allocation change. Companies must consider inventory, transportation, and facility costs when designing their supply chain networks. 

A manager s goal when locating facilities and allocating capacity should be to maximize the overall profitability of the resulting supply chain network while providing customers with the appropriate responsiveness. Revenues come from the sale of product, whereas costs arise from facilities, labor, transportation, material, and inventories. The profits of the firm are also affected by taxes and tariffs. Ideally, profits after tariffs and taxes should be maximized when designing a supply chain network. 

Flexible Design—Planning of Supply Chain Networks... 

---