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Article
Publication date: 6 September 2018

Zhen Hong, C.K.M. Lee and Linda Zhang

The purpose of this paper is twofold, first providing researchers with an overview about the uncertainties occurred in procurement including applicable approaches for analyzing…

6281

Abstract

Purpose

The purpose of this paper is twofold, first providing researchers with an overview about the uncertainties occurred in procurement including applicable approaches for analyzing different uncertain scenarios, and second proposing directions to inspire future research by identifying research gaps.

Design/methodology/approach

Papers related to supply chain risk management and procurement risk management (PRM) from 1995–2017 in several major databases are extracted by keywords and then further filtered based on the relevance to the topic, number of citations and publication year. A total of over 156 papers are selected. Definitions and current approaches related to procurement risks management are reviewed.

Findings

Five main risks in procurement process are identified. Apart from summarizing current strategies, suggestions are provided to facilitate strategy selection to handle procurement risks. Seven major future challenges and implications related PRM and different uncertainties are also indicated in this paper.

Research limitations/implications

Procurement decisions making under uncertainty has attracted considerable attention from researchers and practitioners. Despite the increasing awareness for risk management for supply chain, no detail and holistic review paper studied on procurement uncertainty. Managing procurement risk not only need to mitigate the risk of price and lead time, but also need to have sophisticated analysis techniques in supply and demand uncertainty.

Originality/value

The contribution of this review paper is to discuss the implications of the research findings and provides insight about future research. A novel research framework is introduced as reference guide for researchers to apply innovative approach of operations research to resolve the procurements uncertainty problems.

Details

Industrial Management & Data Systems, vol. 118 no. 7
Type: Research Article
ISSN: 0263-5577

Keywords

Article
Publication date: 25 January 2013

Chong Li and Kejia Chen

The purpose of this paper is to explore new methods to improve supply chain management in uncertain environment, more specifically, to tackle the uncertain demand problem and the…

Abstract

Purpose

The purpose of this paper is to explore new methods to improve supply chain management in uncertain environment, more specifically, to tackle the uncertain demand problem and the inventory optimization problem faced by most supply chain systems.

Design/methodology/approach

The paper develops a multi‐objective inventory optimization model, which combines the classic grey prediction GM(1,1) model with the metaheuristic method. The former is applied to achieve the forecasting mechanism in supply chain operations, and the latter is applied to optimize the model solution.

Findings

Results show that the grey‐based forecasting mechanism performs better than other prediction methods, such as the double exponential smoothing method used in this paper. The solution of the multi‐objective inventory optimization model is also improved with the integration of grey prediction method. These indicate the importance of a forecasting mechanism in supply chain management.

Originality/value

The paper succeeds in constructing a novel inventory optimization model and in providing a novel supply chain management framework. It shows for the first time that grey prediction method combined with metaheuristic method may be a valid approach to supply chain management under uncertain environment.

Article
Publication date: 10 July 2017

Lingcheng Kong, Zhong Li, Ling Liang and Jiaping Xie

When the power generator faces uncertain and independent electricity spot price and renewable energy source supply, two different conditions need to be considered: the…

472

Abstract

Purpose

When the power generator faces uncertain and independent electricity spot price and renewable energy source supply, two different conditions need to be considered: the distributions of renewable energy source electricity and electricity spot price are independent or dependent. The purpose of this paper is to explore the capacity investment strategy under volatile electricity spot price when renewable energy penetration rate is low, taking into account these two conditions.

Design/methodology/approach

The authors design a capacity investment model under dual uncertainties and consider how to optimize the investment capacity in order to maximize profit under two different conditions.

Findings

The authors find that when renewable energy supply fluctuation is unrelated to spot electricity price fluctuation, the renewable energy power profitability is determined by the average cost of spot electricity price and equivalent cost. When renewable energy supply fluctuation is related to spot electricity price fluctuation, the renewable energy power profitability is determined by the market value and the construction and maintenance cost.

Practical implications

Faced with the conflict of the renewable energy supply, the authors need to understand how to plan the generation capacity with intermittent renewable sources. The result helps renewable energy become competitive in the electricity market under loose regulations.

Originality/value

The authors compare two capacity investment strategies that the renewable energy supply fluctuation is related and unrelated to spot electricity price.

Details

Industrial Management & Data Systems, vol. 117 no. 6
Type: Research Article
ISSN: 0263-5577

Keywords

Article
Publication date: 19 July 2018

Linan Zhou, Gengui Zhou, Fangzhong Qi and Hangying Li

This paper aims to develop a coordination mechanism that can be applied to achieve the channel coordination and information sharing simultaneously in the fresh agri-food supply

Abstract

Purpose

This paper aims to develop a coordination mechanism that can be applied to achieve the channel coordination and information sharing simultaneously in the fresh agri-food supply chain with uncertain demand. It seeks to elucidate how the producer can use an option contract to transfer the risk caused by uncertain demand, impel the retailer to share demand information and improve the performance of supply chain.

Design/methodology/approach

An option contract model based on the basic model of fresh agri-food supply chain is introduced to compare the production, profit, risk and information sharing condition of the supply chain in different cases. In addition, a case study focusing on the sale of autumn peaches produced by a local producer is investigated, which provides evidence of the applicability of the authors’ approach.

Findings

The optimal option contract can help the supply chain achieve channel coordination and reach Pareto improvement. In the meantime, such a contract will encourage the retailer to share market demand information with producer spontaneously and help maintain the strategic cooperation between two parties.

Research limitations/implications

This paper considers a single-producer, single-retailer system and both of them are risk neutral.

Practical implications

Presented results can be used as suggestions for improving the contract design of fresh agri-food supply chain in China and can also provide references for other countries with similar experiences as China in fresh agri-food production.

Originality/value

This research introduces the option contract into fresh agri-food supply chain and takes information sharing and the risk caused by uncertain demand into consideration.

Details

Kybernetes, vol. 48 no. 5
Type: Research Article
ISSN: 0368-492X

Keywords

Article
Publication date: 27 April 2018

Xinxuan Cheng, Guoqing Yang and Longfei Fan

This paper aims to develop an uncertain global supply chain network design (GSCND) model with rules of origin (RoOs) and limited import quotas, and to discuss the international…

Abstract

Purpose

This paper aims to develop an uncertain global supply chain network design (GSCND) model with rules of origin (RoOs) and limited import quotas, and to discuss the international factors’ effects on location decisions.

Design/methodology/approach

The authors establish an uncertain GSCND model with the international factors. The transportation costs and customers’ demands are characterized as random variables. To deal with the risk of uncertainty, the authors introduce the customers’ demand service level. A sample approximation approach (SAA) is used to deal with the service level constraint and turn the proposed model into a mixed integer programming. On the basis of the properties of the proposed model, a hybrid memetic algorithm (MA) is designed to solve it.

Findings

The authors find that the proposed MA is efficient to the real supply chain network design problem. Besides, the RoOs and limited import quotas can affect the optimal choices of plant and distribution center locations.

Originality/value

The authors propose an uncertain GSCND model with RoOs and limited import quotas. An MA with SAA is designed to solve the proposed model. The authors apply the proposed model into a real global supply chain of an apparel corporation in East Asia, and give some managerial insights.

Article
Publication date: 30 October 2019

Zhenning Zhu, Lingcheng Kong, Jiaping Xie, Jing Li and Bing Cao

In the hybrid electricity market, renewable energy power generator faces the uncertainty of power market demand and the randomness of the renewable energy generation output. In…

Abstract

Purpose

In the hybrid electricity market, renewable energy power generator faces the uncertainty of power market demand and the randomness of the renewable energy generation output. In order to improve the grid-connected quantity of green power, the purpose of this paper is to design the pricing mechanism for renewable energy power generator with revenue-sharing contract in a two-stage “multi-single” electricity supply chain which contains a single dominant power retailer and two kinds of power suppliers providing different power energy species.

Design/methodology/approach

Considering the dual uncertainties of renewable energy power output and power market demand, the authors design the full-cooperative contract decision-making model, wholesale price contract decision-making model and revenue-sharing contract decision-making model to compare and optimize grid-connected pricing in order to maximize profit of different parties in power supply chain. Then, this paper performs a numerical simulation, discusses the existence of the equilibrium analytical solutions to satisfy the supply chain coordination conditions and analyzes the optimal contract parameters’ variation characteristics and their interaction relationship.

Findings

The authors find that the expected profits of the parties in the hybrid power supply chain are concave about their decision variables in each decision-making mode. The revenue-sharing contract can realize the Pareto improvement for all parties’ interest of the supply chain, and promote the grid-connected quantity of green power effectively. The grid-connected price will reduce with the increase of revenue-sharing ratio, and this impact will be greater on the renewable energy power. The greater the competition intensity in power supply side, the smaller the revenue-sharing ratio from power purchaser. And for the same rangeability of competition intensity, the revenue-sharing ratio reduction of thermal power is less than that of the green power. The more the government subsidizing green power supplier, the smaller the retailer sharing revenue to it.

Practical implications

Facing with the dual uncertainties of green power output and market demand and the competition of thermal power in hybrid electricity market, this study can provide a path to solve the problem of renewable energy power grid-connecting. The results can help green power become competitive in hybrid power market under loose regulations. And this paper suggests that the government subsidy policy should be more tactical in order to implement a revenue-sharing contract of the power supply chain.

Originality/value

This paper studies the renewable energy electricity grid-connected pricing under the uncertainty of power supply and market demand, and compares different contract decision-making strategies in order to achieve the power supply chain coordination. The paper also analyzes the competition between thermal power and renewable energy power in hybrid electricity market.

Details

Industrial Management & Data Systems, vol. 119 no. 9
Type: Research Article
ISSN: 0263-5577

Keywords

Open Access
Article
Publication date: 31 December 2003

Shams Rahman and Christopher Findlay

Supply chains in East Asia are being redesigned following the reassessment of the risk of disruption through terrorist attacks. The nature of these risks and of the costs of the…

Abstract

Supply chains in East Asia are being redesigned following the reassessment of the risk of disruption through terrorist attacks. The nature of these risks and of the costs of the private sector responses is reviewed. The research available suggests the costs incurred are substantial. Government regulation applied to security matters also applies within supply chains. It too has been redesigned in response to the change in the risk of terrorist attacks. Examples of its impacts, and its costs and benefits, are presented. Relevant empirical work remains scarce, but principles for government's role can be identified.

Details

Journal of International Logistics and Trade, vol. 1 no. 1
Type: Research Article
ISSN: 1738-2122

Article
Publication date: 1 December 2006

Mahendrawathi Er and Bart MacCarthy

For manufacturing enterprises, today's business environment is characterised by globally dispersed supply and manufacturing networks. In addition, the level of variety in products…

2817

Abstract

Purpose

For manufacturing enterprises, today's business environment is characterised by globally dispersed supply and manufacturing networks. In addition, the level of variety in products continues to increase in almost all sectors. Greater understanding of the management of product variety in international operations is required. Aims to discuss this issue.

Design/methodology/approach

A generic simulation model representing a multinational corporation (MNC) supply chain is used to investigate the impact on supply chain performance of increasing product variety in combination with supply lead‐time and demand uncertainty in an international setting. The simulation focuses on the upstream activities of production planning, inbound supply and manufacturing. The structure and logic of the simulation model are based on insights obtained from an empirical study of real MNC supply networks.

Findings

The study shows that increasing the level of product variety has a detrimental impact on supply chain performance. In the presence of supply lead‐time and demand uncertainty, high levels of variety result in much longer flow times and much higher system inventory relative to more stable conditions. The impact is greatest when variety involves critical materials which are required early in the production process and that entail long set‐up times.

Research limitations/implications

The study could be extended to incorporate more advanced inventory control models, the inclusion of downstream activities, multiple manufacturing sites and multiple potential supply routes.

Practical implications

Implications for the selection of suppliers and for inventory control policies are discussed in the context of international operations. The potential value of postponement strategies and the need in some cases for fundamental product and process redesign to mitigate the negative impacts of variety are highlighted.

Originality/value

Managing product variety in the context of international operations has received very little attention to date in the research literature. This study quantifies the potential impact of increasing product variety on supply chain performance in an international setting.

Details

Journal of Manufacturing Technology Management, vol. 17 no. 8
Type: Research Article
ISSN: 1741-038X

Keywords

Open Access
Article
Publication date: 30 April 2019

Erno Salmela and Janne Huiskonen

The purpose of this paper is to promote decision-making structures between the customer and the supplier in a highly uncertain environment. This phenomenon of demand-supply chain…

2627

Abstract

Purpose

The purpose of this paper is to promote decision-making structures between the customer and the supplier in a highly uncertain environment. This phenomenon of demand-supply chain synchronisation includes sharing of high-quality and timely demand and supply information in order to improve the quality and speed of decision-making.

Design/methodology/approach

The study was carried out as an abductive case study, which started from empirical observations that did not match the prior theoretical framework. Through abductive reasoning and empirical experiments, the prior framework was extended to a new synchronisation model and tools that better accommodate the observed need.

Findings

A new co-innovation toolbox was developed to create common understanding of demand-supply chain synchronisation between the customer and the supplier. The toolbox includes Demand Visibility Point-Demand Penetration Point, Supply Visibility Point–Supply Penetration Point and Integrative Synchronisation tools.

Research limitations/implications

The study extends the current models and tools of demand-supply chain synchronisation. With the new toolbox, the development needs of decision-making structures can be identified more comprehensively than with the current tools.

Practical implications

The developed visual toolbox helps partners create a common understanding of problems and development possibilities in demand-supply chain synchronisation in a highly uncertain environment. Common understanding is a starting point for changing decision-making structures to improve the overall performance of a demand-supply chain.

Originality/value

The new toolbox is both more comprehensive and more detailed than the previous tools.

Details

International Journal of Operations & Production Management, vol. 39 no. 4
Type: Research Article
ISSN: 0144-3577

Keywords

Article
Publication date: 4 June 2020

Jingxiao Zhang, Hui Li, Hamed Golizadeh, Chuandang Zhao, Sainan Lyu and Ruoyu Jin

This research aims to develop an approach to assess the reliability of integrated construction supply chains via an integrated model of building information modelling (BIM) and…

Abstract

Purpose

This research aims to develop an approach to assess the reliability of integrated construction supply chains via an integrated model of building information modelling (BIM) and the lean supply chain (LSC). It reflects the synergistic workflow between BIM and LSC as a novel approach to improve the reliability of construction projects.

Design/methodology/approach

This research evaluates the reliability of the BIM-LSC approach through a combination of entropy theory, set pair analysis (SPA), and Markov chains (EESM). An exploratory survey was conducted to collect data from 316 industry professionals experienced in BIM and LSC. Subsequently, multiple cycles of calculations were performed with indirect data inputs. Finally, a reliability evaluation index is established for the BIM-LSC approach and potential applications are identified.

Findings

The results show that the EESM model of BIM-LSC developed in this study can handle not only supply chain reliability evaluation at a given state but also the prediction of reliability in supply chain state transitions due to changing project conditions. This is particularly relevant to the current environment of the construction project, which is characterised by an increasing level of complexity in terms of labour, technology, and resource interactions.

Research limitations/implications

Future research could consider the accuracy and validity of the proposed model in real-life scenarios with by considering both quantitative and qualitative data across the entire lifecycle of projects.

Practical implications

The research offers a model to evaluate the reliability of the BIM-LSC approach. The accuracy of BIM supply chain reliability analysis and prediction in an uncertain environment is improved.

Originality/value

The BIM-LSC reliability evaluation and prediction presented in this study provides a theoretical foundation to enhance understanding of the BIM-LSC in the construction project context.

Details

Engineering, Construction and Architectural Management, vol. 27 no. 5
Type: Research Article
ISSN: 0969-9988

Keywords

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