Supply Chain Management is a field of growing interest for both companies and researchers. It consists of the management of material, information, and financial flows in a logistics distribution network composed of parties like vendors, manufacturers, distributors, and customers. The environment in which companies nowadays manage their Supply Chain is highly dynamic. This thesis is devoted to the development of optimization tools that enable companies to detect, and subsequently take advantage of, opportunities that may exist for improving the efficiency of their logistics distribution networks in such a dynamic environment.
Within the field of distribution logistics a number of developments have occurred over the past years. We have seen a globalization of supply chains in which national boundaries are becoming less important. Within Europe we can observe an increase in the attention that is being paid by West-European companies to markets in Eastern Europe and the former Soviet Union. The fact that European borders are disappearing within the European Union results in questions about the reallocation, often concentration, of production. Moreover, the relevance of European and regional distribution centers instead of national ones is reconsidered. According to Kotabe [80], the national boundaries are losing their significance as a psychological and physical barrier to international business. Therefore, companies are stimulated to expand their supply chains across different countries. Global supply chains try to take advantage of the differences in characteristics of various countries when designing their manufacturing and sourcing strategies. For example, the labor and raw materials costs are lower in developing countries while the latest advances in technology are present only in developed countries. As pointed out by Vidal and Goetschalckx [135], global supply chains are more complex than domestic ones because, in an international setting, the flows in the supply chain are more difficult to coordinate. Issues that are exclusive to a global supply chain are different taxes, trade barriers, and transfer prices.
(Image courtesy: AIMS institute of supply chain management image taken from supply chain management certification and masters in supply chain management courses)
There are dynamics inherent to the flows in the supply chain. Fisher [46] introduces the concepts functional and innovative to classify products. Functional products are the physical products without any added value in the form of, for instance, special packaging, fashionable design, service, etc. He argues that functional products have a relatively long life cycle, and thus a stable and steady demand, but often also low profit margins. Therefore, companies introduce innovations in fashion or technology with the objective of creating a competitive advantage over other suppliers of physically similar products, thereby increasing their margins. As a consequence, this leads to a shortening of the life cycle of innovative products since companies are forced to introduce new innovations to stay competitive. Another development that can be observed is the customer orientation. Supply chains have to satisfy the requirements of the customers with respect to the customized products as well as the corresponding services. The first step when designing and controlling an effective supply chain is to investigate the nature of the demand of the products.
The tendency towards a shorter life cycle for innovative products leads to highly dynamic demand patterns and companies need to regularly reconsider the design of their supply chains to effectively utilize all the opportunities for profit. One way of creating a competitive advantage is by maintaining a highly effective logistics distribution network. Thus, logistics becomes an integral part of the product that is being delivered to the customer. Competitiveness encourages a continuous improvement of the customer service level, see Ballou [6]. For example, one of the most influencing elements in the quality of the customer service is the lead time.
Technological advances can be utilized to reduce these lead times, see Slats et al. [125]. For example, Electronic Data Interchange with or without internet leads to improved information flows, which yield a better knowledge of the customers’ needs at each stage of the supply chain.
“found that article in my previous study notes of supply chain training and I remembered that after a week there will be a test day for my students of logistics courses in my supply chain academy where I am teaching the classes of supply chain management diplomat and also giving tips to supply chain management courses students and taking care of supply chain management programs department so I thought to help out students for coming test that’s why I am sharing this article.”
Within the field of distribution logistics a number of developments have occurred over the past years. We have seen a globalization of supply chains in which national boundaries are becoming less important. Within Europe we can observe an increase in the attention that is being paid by West-European companies to markets in Eastern Europe and the former Soviet Union. The fact that European borders are disappearing within the European Union results in questions about the reallocation, often concentration, of production. Moreover, the relevance of European and regional distribution centers instead of national ones is reconsidered. According to Kotabe [80], the national boundaries are losing their significance as a psychological and physical barrier to international business. Therefore, companies are stimulated to expand their supply chains across different countries. Global supply chains try to take advantage of the differences in characteristics of various countries when designing their manufacturing and sourcing strategies. For example, the labor and raw materials costs are lower in developing countries while the latest advances in technology are present only in developed countries. As pointed out by Vidal and Goetschalckx [135], global supply chains are more complex than domestic ones because, in an international setting, the flows in the supply chain are more difficult to coordinate. Issues that are exclusive to a global supply chain are different taxes, trade barriers, and transfer prices.
(Image courtesy: AIMS institute of supply chain management image taken from supply chain management certification and masters in supply chain management courses)
There are dynamics inherent to the flows in the supply chain. Fisher [46] introduces the concepts functional and innovative to classify products. Functional products are the physical products without any added value in the form of, for instance, special packaging, fashionable design, service, etc. He argues that functional products have a relatively long life cycle, and thus a stable and steady demand, but often also low profit margins. Therefore, companies introduce innovations in fashion or technology with the objective of creating a competitive advantage over other suppliers of physically similar products, thereby increasing their margins. As a consequence, this leads to a shortening of the life cycle of innovative products since companies are forced to introduce new innovations to stay competitive. Another development that can be observed is the customer orientation. Supply chains have to satisfy the requirements of the customers with respect to the customized products as well as the corresponding services. The first step when designing and controlling an effective supply chain is to investigate the nature of the demand of the products.
The tendency towards a shorter life cycle for innovative products leads to highly dynamic demand patterns and companies need to regularly reconsider the design of their supply chains to effectively utilize all the opportunities for profit. One way of creating a competitive advantage is by maintaining a highly effective logistics distribution network. Thus, logistics becomes an integral part of the product that is being delivered to the customer. Competitiveness encourages a continuous improvement of the customer service level, see Ballou [6]. For example, one of the most influencing elements in the quality of the customer service is the lead time.
Technological advances can be utilized to reduce these lead times, see Slats et al. [125]. For example, Electronic Data Interchange with or without internet leads to improved information flows, which yield a better knowledge of the customers’ needs at each stage of the supply chain.
“found that article in my previous study notes of supply chain training and I remembered that after a week there will be a test day for my students of logistics courses in my supply chain academy where I am teaching the classes of supply chain management diplomat and also giving tips to supply chain management courses students and taking care of supply chain management programs department so I thought to help out students for coming test that’s why I am sharing this article.”
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