Supply-chain modelling and control under proportional inventory- replenishment policies

C. I. Papanagnou; G. D. Halikias

doi:10.1080/00207720802090898

Supply-chain modelling and control under proportional inventory- replenishment policies

C. I. Papanagnou, G. D. Halikias

School of Infrastructure and Sustainable Engineering

Research output: Contribution to journal › Article › peer-review

Abstract

A novel state-space model of a multi-node supply chain is presented, controlled via local proportional inventory-replenishment policies. The model is driven by a stochastic sequence representing customer demand. The model is analysed under stationarity conditions and a simple recursive scheme is developed for updating its covariance matrix. This allows us to characterise the 'bullwhip effect' (demand amplification) in the chain and to solve an optimisation problem for a three-node model involving the minimisation of inventory subject to a probabilistic constraint on downstream demand. Finally, issues related to estimation schemes based on local historical data are briefly discussed.

Original language	English
Pages (from-to)	699-711
Number of pages	13
Journal	International Journal of Systems Science
Volume	39
Issue number	7
Early online date	19 May 2008
DOIs	https://doi.org/10.1080/00207720802090898
Publication status	Published - Jul 2008

Keywords

Bullwhip effect
Covariance matrix estimation
Information-sharing
State-space model
Supply chain

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10.1080/00207720802090898

https://openaccess.city.ac.uk/id/eprint/14864/

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Supply-chain modelling and control under proportional inventory- replenishment policies

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Keywords

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