Simchi-Levy

User acceptance of the results obtained is often the key barrier to successfully employing operations research methods in strategic planning (cf. Pooley 1994, p. 120). As amongst others Bramel and Simchi-Levi (1997, p. 262) and Billington and Davis (1992, p. 592) point out, a validation of the cost functions integrated into the model is critical to ensure acceptance by top management. 

Journal of the Operational Research Society 50 974-978 Bramel J, Simchi-Levi D (1997) The Logic of Logistics. Springer, Berlin et al. 

Muriel A, Simchi-Levi D (2003) Supply Chain Design and Planning -Applications of Optimization Techniques for Strategic and Tactical Models. In de Kok AG, Graves SC (eds) Supply Chain Management Design, Coordination and Operation. Elsevier, Amsterdam et al., pp 17-93... 

Simchi-Levi D, Kaminsky P, Simchi-Levi E (2003) Designing and Managing the Supply Chain, 2nd edn. McGraw Hill, Boston et al. 

Simchi-Levi D, Simchi-Levi E, Watson M (2003) Tactical planning for reinventing the supply chain. In Harrison TP, Lee HL, Neale JJ (eds) The practice of supply chain management where theory and application converge. Kluwer Academic Publishers, Boston et al., pp 13-30... 

Logistics Systems Modeling, by David Simchi-Levi and... 

Another key challenge at the tactical level is to take into account the dynamics of the supply chain. Indeed, in recent years many suppliers and retailers have observed that while customer demand for specific products does not vary much, inventory and back-order levels fluctuate considerably across their supply chain. For instance, examining the demand for Pampers disposal diapers, executives at Procter Gamble noticed an interesting phenomenon. As expected, retail sMes of the product were fairly uniform there is no particular day or month in which the demand is significantly smaller or larger than any other. However, the distributors placed orders to the factory that fluctuated much more than retail sales. In addition, P G s orders to its supphers fluctuated even more. This increase in variability as we travel up in the supply chain is referred to as the Bullwhip effect. For more on this effect, see Simchi-Levi et al. (1999). 

See Simchi-Levi et al. (1999) for additional discussion on exact and heuristic algorithms. 

Simchi-Levi, D., Kaminsky, R, and Simchi-Levi, E. (1999), Designing and Managing the Supply Chain Concepts, Strategies and Case Studies, McGraw-Hill, Burr Ridge, IL. 

Martinez-de-Albeniz, V, and Simchi-Levi, D. Competition in the Supply Option Market. Working pap>er 189, Center for eBusiness, Massachusetts Institute ofTechnology, April 2003. 

Some typical examples of logistics management are the following (Simchi-Levi et al. 2005) ... 

David Simchi-Levi, S. David Wu, and Z. Max Shen (Eds.) Handbook of Quantitative Supply Chain Analysis Modeling in the E-Business Era 2004 Kluwer Academic Publishers... 

Netessine, S. and N. Rudi. 2001a. Supply chain structures on the Internet and the role of marketing-operations interaction. Forthcoming in "Supply chain analysis in e-business era D. Simchi-Levi, S.D. Wu and M. Shen, Edts., Kluwer. 

Bertsimas, D., D. Simchi-Levi. 1996. A New Generation of Vehicle Routing Research Robust Algorithms, Addressing Uncertainty. Operations Research 44(2), 286-304. 

Zenios, S. 2003. Decentralized Decision Making in Dynamic Technological Systems. In Simchi-Levi, D, D. Wu, and M. Shen (Eds.), Handbook of Supply Chain Analysis in the eBusiness Era. Kluwer Academic Publishers, Boston. 

Chen and Simchi-Levi [33] consider a model identical to the one by Thomas and assume a general demand function of the form... 

In case of the additive demand model, Chen and Simchi-Levi prove that the (s,5,p) policy identified by Thomas is indeed optimal. On the other hand, for the general demand model, they show that a different policy, referred to as an (5, S, A, p) policy is optimal policy. In such a policy, the optimal inventory strategy is characterized by two parameters st and St and a set At C [st st + St)/2], possibly empty. When the inventory level, xt at the beginning of period t is less than st or if xt E At an order of size St — Xt is made. Otherwise, no order is placed. Thus, it is possible that an order will be placed when the inventory level xt E [st, (st 4- St)/2], depending on the problem instance. On the other hand, if xt > (st + St)/2 no order is placed. Price depends on the initial inventory level at the beginning of the period. 

Clearly, the results obtained by Chen and Simchi-Levi also apply to the special case in which the ordering cost function includes only variable but no fixed cost, i.e., the model analyzed by Federgmen and Heching [51]. Indeed, Chen and Simchi-Levi pointed out that their results generalize the results in [51] to more general demand processes, such as the multiplicative demand model. 

In [34], Chen and Simchi-Levi consider the infinite horizon model with stationary parameters and general demand processes. They show that in this case, the (s, 5, p) policy identified by Thomas is optimal under both the average and discounted expected profit criteria. They further consider the problem with continuous inventory review in [35], and show that a stationary (s, S,p) policy is optimal for both the discounted and average proft models with general demand functions and general inter-arrival time distribution. 

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