Joakim Wikner

Industrial Dynamics Simulation Models in the Design of Supply Chains

Reviews the dynamic operation of supply chains and reaches some simple conclusions for reducing demand amplification, which consequently attenuates swings in both production rates and stock levels. ...

Smoothing supply chain dynamics

A three-echelon Forrester production distribution system is used as a supply chain reference model for comparing various methods of improving total dynamic performance. Many authors have exploited the original simulation results for the nominal system, especially when describing problems associated with supply chain behaviour. However, few of these authors have attempted to produce a dynamically superior supply chain as distinct from offering detailed organisational and attitudinal changes needed to achieve any improvement. As the starting point of this paper, the production-distribution system has been transformed into a block diagram representation capable of considerable simplification. A combination of analysis and simulation can then be used to gain a far deeper understanding of the system dynamics than has so far been published. Thus, although the Forrester model is far from optimal, it does provide a well established benchmark against which proposals may be evaluated. For the purpose of illustration, five different approaches are then used to improve the supply chain dynamics. These are -“fine tuning” the existing ordering policy parameters; -reducing system delays; -removal of the distribution echelon; -changing the individual echelon decision rules; -better use of information flow throughout the supply chain. It is shown that by better utilisation of the information flow, significant reductions in the demand amplification can be achieved without substantial expenditure. This is because it is only necessary to separate out the flow of “real” orders from “system” orders as they are passed up the chain. Such collaboration does, however, correspond to the establishment of an integrated supply chain in which the concept of “total system stocks” is accepted.

Long-term capacity management: Linking the perspectives from manufacturing strategy and sales and operations planning

Efficient long-term capacity management is vital to any manufacturing firm. It has implications on competitive performance in terms of cost, delivery speed, dependability and flexibility. In a manu ...

Mass customization in terms of the customer order decoupling point

In recent years the customer order decoupling point (CODP) has gained increased acceptance as an important concept when organizing value-adding activities in production and logistics. The CODP, which is defined as the point in the value-adding material flow that separates decisions made under uncertainty from decisions made under certainty concerning customer demand, is however normally only used for production- and distribution- related activities. Here we adjust the typical CODP typology and show how the engineering resources can be integrated with the production process so as to take the features of mass customization environments into account. This paper also examines existing mass customization frameworks and offers a more thorough and nuanced typology for classifying various levels of mass customization. Finally, the adjusted CODP typology is used as a foundation for developing a reliable order promise process for mass customizers.

Integrating production and engineering perspectives on the customer order decoupling point

Purpose – Traditionally the customer order decoupling point (CODP) has focused mainly on the separation of production performed on speculation from commitment to customer orders. Engineering has, w ...

A control engineering approach to the assessment of supply chain resilience

There is no consensus on the supply chain management definition of resilience. To aid in evaluating the dynamic behaviour of such systems we need to establish clearly elucidated performance criteria that encapsulate the attributes of resilience. A literature review establishes the latter as readiness, responsiveness and recovery. We also identify robustness as a necessary condition that would complement resilience. We find that the Integral of the Time Absolute Error (ITAE) is an appropriate control engineering measure of resilience when it is applied to inventory levels and shipment rates. We use the ITAE to evaluate an often used benchmark model of make-to-stock supply chains consisting of three decision parameters. We use both linear and nonlinear forms of the model in our evaluation. Our findings suggest that optimum solutions for resilience do not yield a system that is robust to uncertainties in lead-time. Hence supply chains will experience drastic changes in their resilience performance when lead-time changes.

Exploiting the Order Book for Mass Customized Manufacturing Control Systems With Capacity Limitations

Customer specific requirements is one of the key drivers in a supply chain strategy based on mass customization. At the same time there are intense pressure on price and short delivery lead times providing a complex environment for managing the supply chain. The complexity can be reduced by introducing the concept of a customer order decoupling point (CODP). The CODP separates the supply chain into two key processes that can be categorized as make-to-order (MTO) and make-to-stock (MTS) and constitutes the two key building blocks of a system based on the mass customization concept. The dynamic properties of the MTS environment have been extensively researched using the automatic pipeline-, inventory-, and order-based production control system (APIOBPCS) archetype. In contrast to MTS systems, the customer facing MTO process, which is usually exposed to a more volatile demand stream suitable for an agile strategy, is less well investigated. Agility does, however, frequently not mean that infinite capacity is available but that there is some surplus capacity available and that the capacity can be adapted to the customer requirements in certain time frames. When the adaptation is not instant but requires some time to take effect the delay creates a dynamic backlog represented by the order book which affects the delivery lead time. Since controlling lead times is a key factor in providing reliable delivery promises an order book control logic is introduced. It is also shown that the new MTO model of the customer facing part of a mass customization system is an extension to the well established APIOBPCS framework

Introducing a customer order decoupling zone in logistics decision-making

The general aim of this paper is to explore the properties of the so-called customer order decoupling point (CODP) to enhance the knowledge and understanding of its possible use in operations and logistics. More specifically, the purpose is to enhance the applicability of the CODP framework so that it also covers scenarios with a gradual increase in certainty concerning information about customer demand. Differentiating between decisions made under certainty and decisions made under uncertainty of customer demand has been identified as a key issue in operations strategy and supply chain management. The CODP identifies this distinction but the concept is limited in that it assumes either total uncertainty or total certainty concerning customer demand. Acknowledging a gradual increase in certainty across multiple independent dimensions provides a point of departure for extending the decoupling point to a decoupling zone. Based on the decoupling zone, we extend the established framework for positioning the CODP and identify eight key decisions related to the decoupling zone that concern positioning, fulfilment strategies and buffer sizing.

Inventory trigger control policies developed in terms of control theory

In this article we model standard inventory ordering rules in terms of control systems theory. A differential equation is designed describing the development of a system in which an input signal reaching a predefined level triggers an output. The reorder point of inventory control systems may be interpreted as such a level triggering a replenishment. Systems using this kind of control are frequent in a variety of applications. Apart from inventory, domestic heat and pressure control are but two examples.

Production planning and control tools

There are numerous tools available to be used for production planning and control purposes. The number of tools is ever increasing, and so are the levels of sophistication as well as complexity. For the specific manufacturing firm, the task of selecting the most appropriate set of tools is not trivial. However, in recent years, the understanding of the relationship between tools and manufacturing environments for which they are suitable has increased. The purpose of this paper is to provide an overview of production planning and control tools available today, as well as new trends, issues and ideas.