Supply chain management is concerned with the coordination of material, information and financial flows within and across often legally separated organizational units. With the recent advances in information technology, real time data exchange has become feasible and affordable. As a result, an equally important issue for supply chain coordination is to incorporate information into a coordination policy.
Coordination in supply chain management has gained much more attention than ever before. A supply chain refers to the production and distribution process from raw materials to finished goods. A supply chain includes of raw material suppliers through end users. Every party in a supply chain is usually an independent business. Those businesses have their own objectives, interest and perspectives of demand forecast. They try to gain competitive advantages, to maximize their profit. However, the individual objectives and interest may conflict with those of others. The conflicts limit the competitiveness of every company and worsen the performance of supply chain. Therefore, when companies face intense competition, companies can't fully use their competitive advantage. To avoid such situations, many companies have realized the importance of coordination. In general, increased coordination improves information flow along the supply chain and enhances the ability of industries to identify and adjust to changing consumer demands Increased coordination also typically results in the ability to gain enhanced control over the production and processing of products to ensure a certain standard of quality and consistency. Coordination results in the alignment and control of various factors including price, quantity, quality, and terms of exchange .
The supply chain members coordinate by sharing information regarding demand, orders, inventory etc. Information sharing between downstream and upstream partners in a supply chain is considered to be a major indicator of the use of SCM. Information sharing is used, in effect, to integrate the entire value chain into one longer chain. Timely information or advanced commitments from downstream customers helps in reducing the inventory costs by offering price discounts and this information can be a substitute for lead time and inventory . The value of information sharing increases as the service level at the supplier, supplier-holding costs, demand variability and offset time increase, and as the length of the order cycle decrease. Information sharing policy results in inventory reductions and cost savings. On the other words, sharing information in a supply chain is important not only to reduce the Bullwhip effect but also to reduce the cost of entire chain. Most of the models assume that a supply chain partner has complete information (including cost, demand, lead time, etc.) about the other partner. This is considered to be major limitations of these models. In decentralized supply chain, hardly will be the situation where complete information will be available with the parties. Coordination under limited information sharing is an important issue of concern to be studied for the decentralized supply
chain
Fuzzy Analytical Network Process (FANP) Method
The FANP is a generalization of the FAHP as a widely used multi criteria decision-making tool by replacing hierarchies with network. More recently a more general form of FAHP approach, which incorporates feedback and interdependent relationships among decision criteria and alternatives, has been proposed as a more accurate approach for modeling complex decision environments. While FAHP is a well-known technique that decomposes a problem into several levels in such a way that they form a hierarchy, FANP enables interrelationships among the decision levels and criteria to be taken into consideration in a more general form.
Supply chain coordination is truly a transformational business strategy that has a profound effect on competitive success. Many companies exchange an increasing amount of supply chain information with their business partners, but still are far from applying a structured Collaborative process. Information sharing increases the efficiency of Supply chain operations, especially when the supply chain is complex. In this paper, we proposed a framework for modeling the flow of customers’ priorities for selecting upstream partner as information to be shared within the supply chain. In addition, the balanced scorecard perspective is used for linking financial and non-financial, tangible and intangible, inward
and outward factors as objectives for prioritizing the attributes that affect selection of upstream partners in a supply chain. A fuzzy based analytical network process is also used to consider interdependencies between the elements of the decision problems including BSC perspectives and upstream partner selection attributes. This gives a much better representation of the linguistic data by adopting fuzzy numbers in decision making.
Consequently, this framework can help actors of the network, to strengthen their strategic relations with upstream and downstream partners.
0 Comments