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Centralised and decentralised supply chain planning

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  • Richard Pibernik
  • Eric Sucky

Abstract

The major task of supply chain planning – as the tactical level of supply chain management – is the determination of supply-chain-wide master plans on a medium-term basis. Both in literature and in commercial supply chain management systems, a centralised approach to supply chain planning is frequently proposed. Due to the incongruence between incentives of the firms involved in the supply chain and overall supply chain objectives, a centralised supply chain planning will either not be accepted or will not lead to system-wide effectiveness. For this reason, supply chain planning decisions are most commonly coordinated on a decentralised basis. In this paper, we analyse the implications and limitations of centralised and decentralised supply chain planning approaches. The results derived from this analysis establish the basis for introducing a generic, conceptual approach supporting the design of a decentralised supply chain planning.

Suggested Citation

  • Richard Pibernik & Eric Sucky, 2006. "Centralised and decentralised supply chain planning," International Journal of Integrated Supply Management, Inderscience Enterprises Ltd, vol. 2(1/2), pages 6-27.
    • Handle: RePEc:ids:ijisma:v:2:y:2006:i:1/2:p:6-27
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    Cited by:

    1. Philip A. Tominac & Victor M. Zavala, 2020. "Economic Properties of Multi-Product Supply Chains," Papers 2006.03467, arXiv.org, revised Jul 2020.
    2. Tamás Faludi, 2020. "Composite Contracts in Supply Chain," Theory Methodology Practice (TMP), Faculty of Economics, University of Miskolc, vol. 16(01), pages 3-9.

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