A policy development model for reducing bullwhips in hybrid production-distribution systems

College

Gokongwei College of Engineering

Department/Unit

Industrial Engineering

Document Type

Article

Source Title

International Journal of Production Economics

Volume

190

First Page

67

Last Page

79

Publication Date

8-1-2017

Abstract

The study considered a hybrid production-distribution system (PDS) in which products move both downstream and upstream. The System Dynamics (SD) modeling methodology was used to examine the effects of integrating product returns and recovery options to the traditional downstream flow in the PDS. The recovery options of remanufacture, cannibalization and refurbish were found to have the most significant effects to the resulting degree of bullwhips and inventory variances. The SD model was then used to identify effective policies that could manage inventory, production and distribution flows in the PDS. Among these policies included the coupling of complementary recovery options and centralization of demand information. It was observed that these policies could actually smoothen the flow of production, which eventually leads to significant decreases in the inventory variances and amplifications in all echelons of the hybrid PDS. © 2016 Elsevier B.V.

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Digitial Object Identifier (DOI)

10.1016/j.ijpe.2016.09.005

Disciplines

Operations Research, Systems Engineering and Industrial Engineering

Keywords

System theory; Industrial management; Remanufacturing

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