IDEAS home Printed from https://ideas.repec.org/a/wly/jnddns/v2016y2016i1n6823934.html

Dynamic Analysis and Optimization of a Production Control System under Supply and Demand Uncertainties

Author

Listed:
  • Qiankai Qing
  • Wen Shi
  • Hai Li
  • Yuan Shao

Abstract

This study investigates the dynamic performance and optimization of a typical discrete production control system under supply disruption and demand uncertainty. Two different types of uncertain demands, disrupted demand with a step change in demand and random demand, are considered. We find that, under demand disruption, the system’s dynamic performance indicators (the peak values of the order rate, production completion rate, and inventory) increase with the duration of supply disruption; however, they increase and decrease sequentially with the supply disruption start time. This change tendency differs from the finding that each kind of peak is independent of the supply disruption start time under no demand disruption. We also find that, under random demand, the dynamic performance indicators (Bullwhip and variance amplification of inventory relative to demand) increase with the disruption duration, but they have a decreasing tendency as demand variance increases. In order to design an adaptive system, we propose a genetic algorithm that minimizes the respective objective function on the system’s dynamic performance indicators via choosing appropriate system parameters. It is shown that the optimal parameter choices relate closely to the supply disruption start time and duration under disrupted demand and to the supply disruption duration under random demand.

Suggested Citation

  • Qiankai Qing & Wen Shi & Hai Li & Yuan Shao, 2016. "Dynamic Analysis and Optimization of a Production Control System under Supply and Demand Uncertainties," Discrete Dynamics in Nature and Society, John Wiley & Sons, vol. 2016(1).
    • Handle: RePEc:wly:jnddns:v:2016:y:2016:i:1:n:6823934
    DOI: 10.1155/2016/6823934
    as

    Download full text from publisher

    File URL: https://doi.org/10.1155/2016/6823934
    Download Restriction: no
    File URL: https://libkey.io/10.1155/2016/6823934?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Disney, S. M. & Towill, D. R., 2003. "The effect of vendor managed inventory (VMI) dynamics on the Bullwhip Effect in supply chains," International Journal of Production Economics, Elsevier, vol. 85(2), pages 199-215, August.
    2. Yunzeng Wang & Yigal Gerchak, 1996. "Periodic Review Production Models with Variable Capacity, Random Yield, and Uncertain Demand," Management Science, INFORMS, vol. 42(1), pages 130-137, January.
    3. Lin, Cheng-Chang & Wang, Tsai-Hsin, 2011. "Build-to-order supply chain network design under supply and demand uncertainties," Transportation Research Part B: Methodological, Elsevier, vol. 45(8), pages 1162-1176, September.
    4. Yu, Haisheng & Zeng, Amy Z. & Zhao, Lindu, 2009. "Single or dual sourcing: decision-making in the presence of supply chain disruption risks," Omega, Elsevier, vol. 37(4), pages 788-800, August.
    5. Disney, S. M. & Naim, M. M. & Towill, D. R., 2000. "Genetic algorithm optimisation of a class of inventory control systems," International Journal of Production Economics, Elsevier, vol. 68(3), pages 259-278, December.
    6. Fabian J. Sting & Arnd Huchzermeier, 2012. "Dual sourcing: Responsive hedging against correlated supply and demand uncertainty," Naval Research Logistics (NRL), John Wiley & Sons, vol. 59(1), pages 69-89, February.
    7. Zhou, Li & Naim, Mohamed M. & Ou Tang & Towill, Denis R., 2006. "Dynamic performance of a hybrid inventory system with a Kanban policy in remanufacturing process," Omega, Elsevier, vol. 34(6), pages 585-598, December.
    8. Volodymyr Babich, 2006. "Vulnerable options in supply chains: Effects of supplier competition," Naval Research Logistics (NRL), John Wiley & Sons, vol. 53(7), pages 656-673, October.
    9. Mohebbi, E. & Choobineh, F., 2005. "The impact of component commonality in an assemble-to-order environment under supply and demand uncertainty," Omega, Elsevier, vol. 33(6), pages 472-482, December.
    10. Petrovic, Dobrila & Roy, Rajat & Petrovic, Radivoj, 1998. "Modelling and simulation of a supply chain in an uncertain environment," European Journal of Operational Research, Elsevier, vol. 109(2), pages 299-309, September.
    11. Frank Chen & Zvi Drezner & Jennifer K. Ryan & David Simchi-Levi, 2000. "Quantifying the Bullwhip Effect in a Simple Supply Chain: The Impact of Forecasting, Lead Times, and Information," Management Science, INFORMS, vol. 46(3), pages 436-443, March.
    12. Xiao, Tiaojun & Qi, Xiangtong, 2008. "Price competition, cost and demand disruptions and coordination of a supply chain with one manufacturer and two competing retailers," Omega, Elsevier, vol. 36(5), pages 741-753, October.
    13. Qi Feng, 2010. "Integrating Dynamic Pricing and Replenishment Decisions Under Supply Capacity Uncertainty," Management Science, INFORMS, vol. 56(12), pages 2154-2172, December.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Dominguez, Roberto & Cannella, Salvatore & Ponte, Borja & Framinan, Jose M., 2020. "On the dynamics of closed-loop supply chains under remanufacturing lead time variability," Omega, Elsevier, vol. 97(C).
    2. Lin, J. & Naim, M.M. & Purvis, L. & Gosling, J., 2017. "The extension and exploitation of the inventory and order based production control system archetype from 1982 to 2015," International Journal of Production Economics, Elsevier, vol. 194(C), pages 135-152.
    3. Dominguez, Roberto & Cannella, Salvatore & Framinan, Jose M., 2021. "Remanufacturing configuration in complex supply chains," Omega, Elsevier, vol. 101(C).
    4. Aggelogiannaki, Eleni & Sarimveis, Haralambos, 2008. "Design of a novel adaptive inventory control system based on the online identification of lead time," International Journal of Production Economics, Elsevier, vol. 114(2), pages 781-792, August.
    5. Tsai, Chih-Yang, 2011. "On delineating supply chain cash flow under collectionrisk," International Journal of Production Economics, Elsevier, vol. 129(1), pages 186-194, January.
    6. Tang, Christopher S., 2006. "Perspectives in supply chain risk management," International Journal of Production Economics, Elsevier, vol. 103(2), pages 451-488, October.
    7. Singh, Yogendra & Disney, Stephen M., 2026. "On the transition from make-to-stock to make-to-order," European Journal of Operational Research, Elsevier, vol. 330(2), pages 444-457.
    8. Yanting Huang & Zongjun Wang, 2017. "Dual-Recycling Channel Decision in a Closed-Loop Supply Chain with Cost Disruptions," Sustainability, MDPI, vol. 9(11), pages 1-28, November.
    9. Cannella, Salvatore & Bruccoleri, Manfredi & Framinan, Jose M., 2016. "Closed-loop supply chains: What reverse logistics factors influence performance?," International Journal of Production Economics, Elsevier, vol. 175(C), pages 35-49.
    10. Kastsian, Darya & Mönnigmann, Martin, 2011. "Optimization of a vendor managed inventory supply chain with guaranteed stability and robustness," International Journal of Production Economics, Elsevier, vol. 131(2), pages 727-735, June.
    11. Caridi, Maria & Crippa, Luca & Perego, Alessandro & Sianesi, Andrea & Tumino, Angela, 2010. "Do virtuality and complexity affect supply chain visibility?," International Journal of Production Economics, Elsevier, vol. 127(2), pages 372-383, October.
    12. Zhu, Stuart X., 2013. "Dynamic replenishment, production, and pricing decisions, in the face of supply disruption and random price-sensitive demand," International Journal of Production Economics, Elsevier, vol. 146(2), pages 612-619.
    13. Zhou, Li & Naim, Mohamed M. & Disney, Stephen M., 2017. "The impact of product returns and remanufacturing uncertainties on the dynamic performance of a multi-echelon closed-loop supply chain," International Journal of Production Economics, Elsevier, vol. 183(PB), pages 487-502.
    14. Caloiero, Giuliano & Strozzi, Fernanda & Zaldívar Comenges, José-Manuel, 2008. "A supply chain as a series of filters or amplifiers of the bullwhip effect," International Journal of Production Economics, Elsevier, vol. 114(2), pages 631-645, August.
    15. Xu, He & Zuo, Xiaolu & Liu, Zhixue, 2015. "Configuration of flexibility strategies under supply uncertainty," Omega, Elsevier, vol. 51(C), pages 71-82.
    16. Zhu, Stuart X., 2015. "Analysis of dual sourcing strategies under supply disruptions," International Journal of Production Economics, Elsevier, vol. 170(PA), pages 191-203.
    17. Qi Feng & J. George Shanthikumar, 2018. "Supply and Demand Functions in Inventory Models," Operations Research, INFORMS, vol. 66(1), pages 77-91, 1-2.
    18. Miragliotta, Giovanni, 2006. "Layers and mechanisms: A new taxonomy for the Bullwhip Effect," International Journal of Production Economics, Elsevier, vol. 104(2), pages 365-381, December.
    19. Weili Yin & Wenxue Ran, 2022. "Utilizing Blockchain Technology to Manage the Dark and Bright Sides of Supply Network Complexity to Enhance Supply Chain Sustainability," Complexity, John Wiley & Sons, vol. 2022(1).
    20. Yi Yang & Youhua (Frank) Chen & Yun Zhou, 2014. "Coordinating Inventory Control and Pricing Strategies Under Batch Ordering," Operations Research, INFORMS, vol. 62(1), pages 25-37, February.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wly:jnddns:v:2016:y:2016:i:1:n:6823934. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://onlinelibrary.wiley.com/journal/3059 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.