Optimal capacity in a coordinated supply chain
dc.contributor.author | Chao, Xiuli | en_US |
dc.contributor.author | Seshadri, Sridhar | en_US |
dc.contributor.author | Pinedo, Michael | en_US |
dc.date.accessioned | 2008-03-06T19:10:53Z | |
dc.date.available | 2009-03-04T14:20:45Z | en_US |
dc.date.issued | 2008-03 | en_US |
dc.identifier.citation | Chao, Xiuli; Seshadri, Sridhar; Pinedo, Michael (2008). "Optimal capacity in a coordinated supply chain." Naval Research Logistics 55(2): 130-141. <http://hdl.handle.net/2027.42/58030> | en_US |
dc.identifier.issn | 0894-069X | en_US |
dc.identifier.issn | 1520-6750 | en_US |
dc.identifier.uri | https://hdl.handle.net/2027.42/58030 | |
dc.description.abstract | We consider a supply chain in which a retailer faces a stochastic demand, incurs backorder and inventory holding costs and uses a periodic review system to place orders from a manufacturer. The manufacturer must fill the entire order. The manufacturer incurs costs of overtime and undertime if the order deviates from the planned production capacity. We determine the optimal capacity for the manufacturer in case there is no coordination with the retailer as well as in case there is full coordination with the retailer. When there is no coordination the optimal capacity for the manufacturer is found by solving a newsvendor problem. When there is coordination, we present a dynamic programming formulation and establish that the optimal ordering policy for the retailer is characterized by two parameters. The optimal coordinated capacity for the manufacturer can then be obtained by solving a nonlinear programming problem. We present an efficient exact algorithm and a heuristic algorithm for computing the manufacturer's capacity. We discuss the impact of coordination on the supply chain cost as well as on the manufacturer's capacity. We also identify the situations in which coordination is most beneficial. © 2008 Wiley Periodicals, Inc. Naval Research Logistics, 2008 | en_US |
dc.format.extent | 139117 bytes | |
dc.format.extent | 3118 bytes | |
dc.format.mimetype | application/pdf | |
dc.format.mimetype | text/plain | |
dc.publisher | Wiley Subscription Services, Inc., A Wiley Company | en_US |
dc.subject.other | Mathematics and Statistics | en_US |
dc.title | Optimal capacity in a coordinated supply chain | en_US |
dc.type | Article | en_US |
dc.rights.robots | IndexNoFollow | en_US |
dc.subject.hlbsecondlevel | Industrial and Operations Engineering | en_US |
dc.subject.hlbtoplevel | Engineering | en_US |
dc.description.peerreviewed | Peer Reviewed | en_US |
dc.contributor.affiliationum | Department of Industrial and Operations Engineering, University of Michigan, Ann Arbor, Michigan 48109–2117 ; Department of Industrial and Operations Engineering, University of Michigan, Ann Arbor, Michigan 48109–2117 | en_US |
dc.contributor.affiliationother | Stern School of Business, New York University, New York, New York 10012 | en_US |
dc.contributor.affiliationother | Stern School of Business, New York University, New York, New York 10012 | en_US |
dc.description.bitstreamurl | http://deepblue.lib.umich.edu/bitstream/2027.42/58030/1/20271_ftp.pdf | |
dc.identifier.doi | http://dx.doi.org/10.1002/nav.20271 | en_US |
dc.identifier.source | Naval Research Logistics | en_US |
dc.owningcollname | Interdisciplinary and Peer-Reviewed |
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