One area in which experimental economics methods have been used to study operations problems is supply-chain management. We survey results from a series of human experiments based on the popular beer distribution game and find cognitive limitations on the part of managers, in particular an underweighting of the supply line. We suggest mechanisms that may alleviate this bias, including sharing i...

A supply-chain is a series of connected stock management structures. Therefore, the structure of a supply-chain consists of many cascading inventory management problems. It is known that the optimal inventory control parameter values suggested by the literature are also valid for a supply-chain. The motivation for this study is to investigate the effect of the literature suggested optimal value...

We consider a two-echelon supply chain: a single retailer holds a finished goods inventory to meet an i.i.d. customer demand, and a single manufacturer produces the retailer’s replenishment orders on a make-to-order basis. In this setting the retailer’s order decision has a direct impact on the manufacturer’s production. It is a well known phenomenon that inventory control policies at the retai...

We review multi-echelon inventory models for repairable items. Such models have been widely applied to the management of critical spare parts for military equipment for around three decades, but the application to manufacturing and service industries seems to be much less documented. We feel that the appropriate use of models in the management of spare parts for heavily utilized equipment in in...

We consider a multi-product serial two echelon inventory system with stochastic demand. Inventories at the downstream location are replenished periodically using an automatic ordering system. Under vendor managed inventory strategies the upstream stage is allowed to adapt these orders in order to benefit from economies of scale. We propose three different VMI strategies, aiming to reduce the or...

  This paper aims to evaluate inventory cost of a Two-echelon serial supply chain system under vendor managed inventory program with stochastic demand, and examine the effect of environmental factors on the cost of overall system. For this purpose, we consider a two-echelon serial supply chain with a manufacturer and a retailer. Under Vendor managed inventory program, the decision on inventory ...

This paper examines the assertion that partial pooling of customers is sometimes favored over complete pooling on the sole basis of demand correlation. First, the management of inventory within a supply chain is discussed, with speci2c attention paid to risk-pooling. Then, the claim that partial pooling can dominate is theoretically discussed. The conditions under which previous research found ...

Inventory control policies have been recognized as a contributory factor to the bullwhip effect and inventory instability. Previous studies have indicated that there is a trade-off between bullwhip effect and inventory performance where the bullwhip effect reduction might increase inventory instability. Therefore, there is a need for inventory control policies that can cope with supply chain dy...

In this paper, the cost function for a three-echelon inventory system with two warehouses is derived. Transportation times are constant and retailers face independent Poisson demand. Replenishments are one-for-one. The lead time of a retailer is determined not only by the constant transportation time but also by the random delay incurred due to the availability of stock at the warehouses. We co...

Supply chain inventories are prone to fluctuations and instability. Known as the bullwhip effect, small variations in the end item demand create oscillations that amplify throughout the chain. By using system dynamics simulation, we investigate some of the structural sources of the bullwhip effect, and explore the effectiveness of information sharing to eliminate the undesirable fluctuations. E...