Dimitrios Vlachos

A system dynamics model for dynamic capacity planning of remanufacturing in closed-loop supply chains

Abstract Product recovery operations in reverse supply chains face continually and rapidly changing product demand characterized by an ever increasing number of product offerings with reduced lifecycles due to both technological advancements and environmental concerns. Capacity planning is a strategic issue of increased complexity importance for the profitability of reverse supply chains due to their highly variable return flows. In this work we tackle the development of efficient capacity planning policies for remanufacturing facilities in reverse supply chains, taking into account not only economic but also environmental issues, such as the take-back obligation imposed by legislation and the “green image” effect on customer demand. The behavior of the generic system under study is analyzed through a simulation model based on the principles of the system dynamics methodology. The simulation model provides an experimental tool, which can be used to evaluate alternative long-term capacity planning policies (“what-if” analysis) using total supply chain profit as measure of policy effectiveness. Validation and numerical experimentation further illustrate the applicability of the developed methodology, while providing additional intuitively sound insights.

Waste biomass-to-energy supply chain management: a critical synthesis.

The development of renewable energy sources has clearly emerged as a promising policy towards enhancing the fragile global energy system with its limited fossil fuel resources, as well as for reducing the related environmental problems. In this context, waste biomass utilization has emerged as a viable alternative for energy production, encompassing a wide range of potential thermochemical, physicochemical and bio-chemical processes. Two significant bottlenecks that hinder the increased biomass utilization for energy production are the cost and complexity of its logistics operations. In this manuscript, we present a critical synthesis of the relative state-of-the-art literature as this applies to all stakeholders involved in the design and management of waste biomass supply chains (WBSCs). We begin by presenting the generic system components and then the unique characteristics of WBSCs that differentiate them from traditional supply chains. We proceed by discussing state-of-the-art energy conversion technologies along with the resulting classification of all relevant literature. We then recognize the natural hierarchy of the decision-making process for the design and planning of WBSCs and provide a taxonomy of all research efforts as these are mapped on the relevant strategic, tactical and operational levels of the hierarchy. Our critical synthesis demonstrates that biomass-to-energy production is a rapidly evolving research field focusing mainly on biomass-to-energy production technologies. However, very few studies address the critical supply chain management issues, and the ones that do that, focus mainly on (i) the assessment of the potential biomass and (ii) the allocation of biomass collection sites and energy production facilities. Our analysis further allows for the identification of gaps and overlaps in the existing literature, as well as of critical future research areas.

A Periodic Review Inventory System with Emergency Replenishments

This paper proposes and analyzes a periodic review inventory system with two replenishment modes. Regular orders are placed periodically following a base stock policy on inventory position, and arrive at the stocking location after a deterministic lead time. The location also has the option of placing emergency orders, characterized by a shorter lead time but higher acquisition cost, in case of imminent stockouts. Thus, at some appropriate time in the replenishment cycle, the necessity and size of an emergency order is determined according to a base stock policy on net stock. The timing of the emergency order is such that this order arrives and can be used to satisfy the demand in the time period just before the arrival of a regular order, when the likelihood of a stockout is highest. An approximate cost model is developed which can easily be optimized with respect to the order-up-to parameters. This model is used as the basis for a heuristic algorithm, which leads to solutions that are very close to the exact optimal solutions determined through simulation. It is shown that the proposed system offers substantial cost savings relative to a system without the emergency replenishment option.

On the necessity of a disposal option for returned items that can be remanufactured

We study a single item hybrid production system with manufacturing and remanufacturing. It is assumed that remanufacturing is profitable and that, on average, there are more demands than returns. We investigate using simulation, for a variety of cases with different demand, return, manufacturing, and remanufacturing characteristics, what the cost reduction associated with having a disposal option for returned items is. The results show that there is only a considerable cost reduction if an item is very slow-moving, the recovery rate is high, and remanufacturing is almost as expensive as manufacturing.

Optimal newsvendor policies for dual-sourcing supply chains

We propose generic single period (newsvendor-type) inventory models for capturing the trade-off between inventory policies and disruption risks in a dual-sourcing supply chain network both unconstrained and under service level constraints, where both supply channels are susceptible to disruption risks. The models are developed for both risk neutral and risk-averse decision-makers and can be applicable for different types of disruptions related among others to the supply of raw materials, the production process, and the distribution system, as well as security breaches and natural disasters. Analytical closed-form solutions are obtained and interesting managerial insights on the merit of contingency strategies in managing uncertainties and risks in dual-sourcing supply chains are discussed.

An analytical methodological framework for the optimal design of resilient supply chains

Managing risk and disruptions have emerged as issues of critical importance for todays globalised supply chains. In this work, we first provide an up-to-date taxonomy of the risks that supply chains are exposed to along with the appropriate solutions that can be employed to improve their resiliency. We then proceed by outlining an analytical methodological framework for supporting the design and operations of efficient supply chains in the new business environment by taking into account the stochasticity of various factors that can lead to disruptions. More specifically, we present a novel, to our knowledge, stochastic single period quantitative model that can assist in the decision-making process regarding the optimal security protection-based configuration of a supply chain both for single and multiple disruption cases. We obtain closed-form solutions in all cases allowing for capturing the optimal trade-off between inventory policies and supply chain protection levels. Finally, we discuss additional useful managerial insights that were obtained.

An inventory system with two supply modes and capacity constraints

Abstract This paper analyses a periodic review inventory system with a main and an emergency supply mode, where policies of the base-stock type are used at both supply channels. Contrary to previously published models, the capacity of the emergency channel is taken into account. We examine two alternative ordering policies for that channel: an “early-ordering” policy that almost eliminates early stockouts in a replenishment cycle and a “late-ordering” policy that delays the emergency order decision until more demand information has been accumulated. Approximate cost models are developed and properties of their optimal solutions are derived. Simulation results indicate that these solutions are near optimal. Conclusions are drawn about the relative effectiveness of the two emergency ordering policies.

Inventory Strategies For Systems With Fast Remanufacturing

We describe hybrid manufacturing/remanufacturing systems with a long lead time for manufacturing and a short lead time for remanufacturing. We review the classes of inventory strategies for hybrid systems in the literature. These are all based on equal lead times. For systems with slow manufacturing and fast remanufacturing, we propose a new class. An extensive numerical experiment shows that the optimal strategy in the new class almost always performs better and often much better than the optimal strategies in all other classes.

A stochastic inventory management model for a dual sourcing supply chain with disruptions

As companies continue to globalise their operations and outsource significant portion of their value chain activities, they often end up relying heavily on order replenishments from distant suppliers. The explosion in long-distance sourcing is exposing supply chains and shareholder value at ever increasing operational and disruption risks. It is well established, both in academia and in real-world business environments, that resource flexibility is an effective method for hedging against supply chain disruption risks. In this contextual framework, we propose a single period stochastic inventory decision-making model that could be employed for capturing the trade-off between inventory policies and disruption risks for an unreliable dual sourcing supply network for both the capacitated and uncapacitated cases. Through the developed model, we obtain some important managerial insights and evaluate the merit of contingency strategies in managing uncertain supply chains.

Stochastic inventory control for product recovery management

Essentially, inventory management concerns the process of deciding on 1) how often to review stocks, 2) when to replenish stocks, and 3) how much to replenish. This basic focus of inventory management persists in the presence of item returns that can be recovered and then used for servicing demand. However, the details and complexities with which the three basic decisions manifest themselves can, and usually do, differ greatly due to the presence of recoverable-item flows. This, and the practical relevance of inventory management with recoverables, warrants the development of inventory theory that explicitly includes flows of recoverable items.