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Development of a Rapid-Response Supply Chain at Caterpillar

Author

Listed:
  • Uday Rao

    (Graduate School of Industrial Administration, Carnegie Mellon University, 5000 Forbes Avenue, Pittsburgh, Pennsylvania 15213-3890)

  • Alan Scheller-Wolf

    (Graduate School of Industrial Administration, Carnegie Mellon University, 5000 Forbes Avenue, Pittsburgh, Pennsylvania 15213-3890)

  • Sridhar Tayur

    (Graduate School of Industrial Administration, Carnegie Mellon University, 5000 Forbes Avenue, Pittsburgh, Pennsylvania 15213-3890)

Abstract

As part of its growth strategy, Caterpillar Inc. is launching a new P2000 product line of “compact” construction equipment and worktools. In anticipation of this, they asked the authors to construct and analyze potential P2000 supply chain configurations. Using decomposition and results from network flow theory, inventory theory, and simulation theory, we were able to provide solutions to this problem for different supply chain scenarios provided by Caterpillar. Novel features of our model include expedited deliveries, partial backlogging of orders, and realized sales that are responsive to service. Caterpillar made their decision regarding the P2000 supply chain based on our recommendations.

Suggested Citation

  • Uday Rao & Alan Scheller-Wolf & Sridhar Tayur, 2000. "Development of a Rapid-Response Supply Chain at Caterpillar," Operations Research, INFORMS, vol. 48(2), pages 189-204, April.
    • Handle: RePEc:inm:oropre:v:48:y:2000:i:2:p:189-204
    DOI: 10.1287/opre.48.2.189.12380
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    References listed on IDEAS

    as
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