Polynomial algorithm of inventory model with complete backordering and correlated demand caused by cross-selling
الگوریتم چند جمله ای مدل انبارداری با سفارش تاخیر شده کامل و تقاضای همبسته ایجاد شده توسط فروش تقاطعی-2018
In a paper published in the International Journal of Production Economics (IJPE) [Zhang, R., Kaku, I., Xiao, Y., 2012. Model and heuristic algorithm of the joint replenishment problem with complete backordering and correlated demand. International Journal of Production Economics 139 (1), 33–41], the authors proposed a joint replenishment problem (JRP) model with complete backordering and correlated demand caused by cross-selling. The model was transformed into minimizing a function with respect to multiples of a major items order cycle, and a heuristic algorithm was developed for near-optimal solutions. In this paper, we reinvestigate the problem and analyze the mathematical property of the model to develop an exact algorithm. The algorithm can obtain global optima and exhibits polynomial complexity.
keywords: Inventory |Joint replenishment problem |Polynomial algorithm |Complete backordering |Cross-selling
Optimal production-sales policies and entry time for successive generations of new products
سیاست های بهینه تولید - فروش و زمان ورود برای نسل های بعدی محصولات جدید-2018
This paper explores the optimal initial inventory at launch, sales plan, and introduction time for a new generation of a product. We propose a multi-generation demand model that accounts for supply constraints. A mathematical model of the supply-restricted multi-generation diffusion problem is then developed and the optimal sales policy is derived. Closed-form analytical expressions as well as numerical experiments are used to investigate the effect of consumers backlogging, cost of production capacity, unit profit margin for the products, market expansion by the new generation, and cannibalization of older generations. Through consideration of supply restrictions and lost sales, we are able to generalize previous findings on market entry policy by showing that there is a continuous range of optimal introduction times. We show that the inter-dependence between production capacity and initial inventory varies based on the introduction time of the new generation. We also provide an application of the proposed model in the case of Sonys PlayStation®3 game console. The results suggest that the company introduced the product too late and overproduced inventory which, as supported by empirical evidence, had a negative impact on the products performance. Limitations and considerations for the application of the model are also discussed.
keywords: Production and inventory management |Myopic and build-up policies |Market entry timing |Multi-generation innovation diffusion |PlayStation®3 game console
Coordinating manufacturers innovation and retailers promotion and replenishment using a compensation-based wholesale price contract
هماهنگ سازی نوآوری سازنده و تبلیغ و تجدید تدارکات خرده فروش با استفاده از یک قرارداد قیمت عمده فروشی مبتنی بر غرامت-2018
In this paper, coordination of a manufacturer-retailer chain is investigated where the manufacturer innovates in manufacturing process and the retailer applies promotional efforts. The market demand is assumed to be stochastic dependent on the retailers promotional and the manufacturers innovation efforts. The retailer uses a periodic review inventory system for replenishing items and decides on order-up-to level, review period and promotional efforts level. On the other hand, it is possible for the manufacturer to boost the market demand by innovation in manufacturing process. The retailers promotional and manufacturers innovation efforts not only affect their profits, but also impress their mutual profits and the supply chain performance in an indirect manner. Firstly, we develop the decentralized and centralized decision-making models along with solution procedures and concavity analysis to solve the models. Although the centralized model improves the profitability of the whole supply chain, it may reduce the profitability of either the retailer or the manufacturer. Therefore, we propose a new compensation-based wholesale price contract for encouraging actors to take part in the joint decision-making scheme. Moreover, a profit sharing strategy based on the bargaining power of members is proposed for distributing the surplus profit between members. Finally, the results of the decentralized, centralized and coordination models are compared using test problems and some sensitivity analyses are presented.
keywords: Supply chain coordination |Promotional and innovation |Periodic review |Inventory system |Compensation |Wholesale price contract |Profit sharing
Effect of a lead time-dependent cost on lead time quotation, pricing, and capacity decisions in a stochastic make-to-order system with endogenous demand
تاثیر یک هزینه مستقل از زمان سفارش روی خرید و فروش در این زمان، قیمت گذاری و تصمیمات ظرفیتی در یک سیستم تصادفی سفارشی با تقاضای درون زا-2018
The research on lead time quotation in make-to-order stochastic systems with an endogenous demand generally considers a system modelled as an M/M/1 queue with a linear demand that is sensitive to lead time and price, and always assume a constant unit operating cost. It is known that firms can reduce the operating cost by quoting a longer lead time. The idea of this paper stems from this observation. Indeed, we extend the existing works by modelling the unit operating cost, not as a constant, but as a convex decreasing function of the quoted lead time, which significantly rises the analytical difficulty but offers opportunities for many insights. We study three settings: (i) lead time quotation model, (ii) lead time quotation and pricing model, and (iii) lead time quotation, pricing, and capacity decision model. For each setting, we provide the optimal policy and conduct experiments to derive insights. In particular, we analyze the new trade-offs raised by the consideration of a lead time-sensitive cost. Some of our results are not intuitive.
keywords: Lead time quotation |Lead time-dependent cost |Pricing |Capacity |Endogenous demand |M/M/1 queue
The effects of cooperation in accreditation on international trade: Empirical evidence on ISO 9000 certifications
تاثیرات همکاری در شتاب دهی تجارت بین المللی: شواهد تجربی از گواهی نامه های ایزو 9000-2018
Companies use standards as a tool to signal their investments in quality upgrading and performance. We argue that the impact of this signal depends on the trust in the accreditation system and the development status of a country. Representing the workhorse of research in international trade, we use a gravity model to examine the trade effects of ISO 9000 diffusion and cooperation in accreditation. The model is estimated by applying a country-pair fixed effects regression approach with instrumental variables and multilateral resistance terms to a panel data set covering a 13-year period from 1999 to 2012. This allows us to test our hypotheses with respect to the moderating role of international cooperation in accreditation on the trade effects of ISO 9000 diffusion. We show that certification promotes trade and that signatories to the Multilateral Recognition Arrangement of the International Accreditation Forum (IAF MLA) trade significantly more. The IAF MLA is of particular importance to the trade among developing countries. For policy makers, our results highlight the importance of support for accreditation institutions in developing countries.
keywords: Standardization |ISO 9000|ISO 14000 |Accreditation |Trade |Gravity model
The impact of abusing return policies: A newsvendor model with opportunistic consumers
تاثیر سوء استفاده از سیاست های بازگشتی: یک مدل روزنامه فروشی با مشتری های فرصت طلب-2018
Consumers may return a product for a variety of reasons, such as the product having the wrong color or size, having poor functionality, being damaged during shipment, or simply prompting regret for an impulsive purchase. Retailers generally provide lenient return policies not only because they may signal high quality but also because they act as risk relievers for consumers’ purchasing decision processes. However, increasing product returns have become particularly challenging for the efficient management of inventory. As such, at the crux of a holistic inventory model lies the understanding of consumer return behavior. In this study, we introduce a variant of the classical single-period inventory (newsvendor) model with returns, in which heterogeneous consumers decide, based on their post-purchase valuation of the product, whether to return the product after using it. From the perspective of the retailer, such deliberate returns may abuse the return policy, which in turn may exacerbate reverse logistics and environmental costs. To that end, we incorporate demand uncertainty and consumer valuation uncertainty by explicitly gauging return probabilities and differentiated salvage values into a newsvendor model. We derive analytical results for the profit-maximizing order quantity for a single-period product that comes with a retailer return policy and exclusively identify the impact of return type as abused or normal. Also offered are closed-form optimal solutions in the cases where market demand is exponentially or uniformly distributed. Structural and numerical results lend managerial insight into how optimal ordering amount, profit, return rates and salvage values change with the price, return window, and hassle cost of returning the product.
keywords: Inventory management |Consumer behavior |Product returns |Fraudulent proclivity |Uncertain demand |Return policy
China-related POM research: Literature review and suggestions for future research
تحقیقات POM مربوط به چین: مرور منابع علمی و پیشنهاداتی برای تحقیقات آتی-2018
This study investigates trends in China-related production and operations management (POM) research over the past 10 years (2006–2015). Descriptive statistics analyses are used to identify trends in topics, data, and contributions. We also identify representative examples from the literature to illustrate topics and contributions. Due to Chinas economic success, there has been a remarkable growth of China-related POM research in the past 10 years. Supply chain management, performance measurement and productivity, regulatory and environmental issues in operations, and purchasing/sourcing systems are the four most prominent research areas, which is a different pattern from the publications on other emerging economies. The number of articles adopting novel frameworks and approaches has increased, while the number of descriptive articles has decreased. This literature review offers an overview of previous China-related POM articles and provides several areas for future research. It also provides a better understanding of how China-related POM research has evolved and of new research topics that are emerging, which will help researchers to identify key POM issues in China.
keywords: Operations management |Production management |International business |Literature review |China
Environmental uncertainty, specific assets, and opportunism in 3PL relationships: A transaction cost economics perspective
عدم قطعیت محیطی، دارایی های ویژه و فرصت طلبی در روابط 3PL: یک دیدگاه اقتصادی هزینه ای تراکنشی-2018
Service provider opportunism is a serious concern in third party logistics (3PL) relationships. However, our knowledge about the antecedents of 3PL providers opportunism is limited. According to transaction cost economics (TCE), increased transaction costs cause opportunism. This study incorporates key TCE constructs (environmental uncertainty, specific assets, and opportunism) and conducts a transaction cost analysis. We argue that environmental uncertainty and specific assets create exchange hazards that result in opportunism. Meanwhile, specific assets reduce coordination costs raised by environmental uncertainty. Building on these arguments, this study tests a model that hypothesizes that environmental uncertainty (demand, supply, and technology uncertainty), and specific assets (user- and provider-specific assets) are positively related to opportunism, and that environmental uncertainty is positively related to specific assets. Structural equation modeling is used to examine data from 247 3PL relationships in China. The results show that demand uncertainty decreases opportunism, supply uncertainty increases opportunism, and technology uncertainty does not have a significant effect. User-specific assets increase opportunism, while provider-specific assets decrease opportunism. Demand and supply uncertainty have positive effects on user-specific assets, but non-significant effects on provider-specific assets, while technology uncertainty does not have a significant impact on user or provider-specific assets. In general, our findings are supported by the rationale of TCE, and industrial or cultural factors can explain several surprising findings. This study contributes to 3PL literature and practice.
keywords: Environmental uncertainty |Specific assets |Opportunism |3PL |Transaction cost economics
An age-based lateral-transshipment policy for perishable items
یک سیاست انتقال عرضی به کشتی مبتنی بر سن برای کالاهای فاسد شدنی-2018
Lateral transshipment is an efficient policy designed to improve the performance of a supply chain. Despite the importance of transshipment for perishable items, few studies consider the issue of perishability. Currently, transshipment in some blood supply chains is based on the age profile of units in hospitals. However, decisions such as the age threshold are made empirically and are fixed for all hospitals. In this paper, we propose a new transshipment policy for perishable items based on the age of the oldest item in the system to improve supply-chain performance. The proposed model has applications for transshipping blood units between hospitals. We develop a heuristic solution using partial differential equations to compute performance measures and cost function. The results demonstrate that our transshipment policy is effective under various circumstances such as lost sale and backordering. We also compare the performance of the suggested transshipment policy to the transshipment policy that is currently practiced in some Australian hospitals (which is an aged based proactive transshipment policy with an empirically set threshold). The results demonstrate that by setting the optimal threshold, hospitals could transfuse units with the same average age of the current policy, while reducing their total inventory cost by approximately 61%.
keywords: Blood supply chain |Perishable inventory |Lateral transshipment
Capacity investment under uncertainty: The effect of volume flexibility
سرمایه گذاری روی ظرفیت تحت عدم قطعیت: تاثیر انعطاف پذیری حجم-2018
Real option theory is a central tool in todays investment theory as it integrates uncertainty and managerial flexibility in the analysis and valuation of investment projects. This paper studies the optimal time and size of investment for a monopolistic firm under demand uncertainty and volume flexibility. In our modeling framework, demand is random and the firm first decides the optimal time and size of the production process. After entry, the firm adjusts continuously production volume to match the observed demand. Volume flexibility comes at a cost which depends on both the current output and the established capacity. We study two different models of volume flexibility: Downside volume flexibility allows the firms to produce any quantity below the installed capacity; Upside volume flexibility allows to expand production above the firms capacity size. In both cases, the option to temporary suspend production is not given a priori, but it is part of the firms optimal choice. With this feature, the model provides conclusions that contrast some of the most recent theoretical findings on the same subject. We find that an increase of the degree of downside volume flexibility makes the firm willing to invest earlier in a larger plant. We also show that downside volume flexibility reduces the utilization rates, especially in highly uncertain markets. Upside volume flexibility has the joint effect of reducing the size of the investment and the investment threshold at which the firm installs capacity. The utilization rates are significantly higher compared to the case of downside volume flexibility only, and there is an increasing relationship between increased upside flexibility and utilization rates.
keywords: Real options |Capacity investments |Volume flexibility