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Considerable research literature exists on production planning, distribution, and investment models. In most cases they have been treated independently in an environment of low inflation rates. Unfortunately, work extending these problems to multinational companies is sparse. This paper develops an integrated production planning, distribution, and...
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Citations
... Contributing factor to this inclusion is the realization on the part of SC managers of the importance of supply chain management (SCM) to the organizational competitiveness and increased amount of interest in fact-based SCM (Shapiro, 2004). Hence in the recent times a large number of studies have modelled various facets of SCs with differing amounts of details (Denton, et al., 2006;Graves & Willems, 2005;Jain & Palekar, 2005;Kremer, et al., 2006;Lashine, et al., 2006;Mohamed & Youssef, 2004;Moon, et al., 2008;Truong & Azadivar, 2005). Vidal & Goetschalckx (1997) pointed out that productiondistribution system designs have been actively researched in the literature. ...
Supply chain management and optimization is a critical aspect of modern enterprises and an expanding area of research. Modeling and optimization are the traditional tools of supply chain management. The techniques have been used by many companies for planning, manufacturing, and other decision areas in supply chains. Current study is motivated by the fact that optimization studies in supply chain management have mostly considered network optimization. Supply chain management however, requires alignment between the supply chain partners at the tactical level. As a first step towards achieving this goal, current study presents a model that incorporates the activity level planning at the focal firm in a supply chain. This paper presents a new mixed integer programming model that incorporates optimization of production planning at the focal firm while optimizing the strategic alignment of the supply chain entities. The model represents a four step, multi-echelon supply chain including supplier, warehouse, manufacturer, and retailer. The manufacturer in this network represents the focal firm. This model is an attempt to integrate the production planning decisions in the network optimization decisions.
... Efficient allocation of resources should be planned to avoid sectoral conflicts. Mohamed and Youssef (2004) asserted that optimal selection of production, distribution, and investment decisions are interrelated. Investments in the markets are done to support the production and distribution activities. ...
... In contrast, most of the researchers paid attention to traditional performance variables such as cost, delivery, service, and quality for designing supply chain networks. Mohamed and Youssef (2004) developed a decision support system based on profit maximisation for production, distribution, and investment in markets of facilities Koul and Verma (2011) selected the potential vendors having the higher score of overall traditional performance. ...
... It also allows decision makers to input a set of the relative objective weights based on their supply chain strategies. Evidentially, GOOG prevails over others which were capable of suggesting either partner selection (Koul and Verma, 2011;Lee et al., 2011) or manufacturing plant locations and allocations (Mohamed and Youssef, 2004), whereas appropriate transportation modes and lot-sizes were not suggested. The suggestions contributed to either optimisation of multiple traditional performances (Koul and Verma (2011); optimisation of multiple green performances (Lee et al., 2011), or profit maximisation (Mohamed and Youssef, 2004), but the simultaneous optimisation of cost, lead time, and environmental impact were overlooked. ...
... Evidentially, GOOG prevails over others which were capable of suggesting either partner selection (Koul and Verma, 2011;Lee et al., 2011) or manufacturing plant locations and allocations (Mohamed and Youssef, 2004), whereas appropriate transportation modes and lot-sizes were not suggested. The suggestions contributed to either optimisation of multiple traditional performances (Koul and Verma (2011); optimisation of multiple green performances (Lee et al., 2011), or profit maximisation (Mohamed and Youssef, 2004), but the simultaneous optimisation of cost, lead time, and environmental impact were overlooked. However, carbon tax and/or Emission Trading Scheme (ETS), which reinforce the lower environmental impact (especially, carbon emissions) and the higher awareness of environmental management approaches, are not included in its current version of GOOG. ...
Purpose
– The purpose of this paper is to propose a Generic decision support system which is based on multi-Objective Optimisation for Green supply chain network design (GOOG). It aims to support decision makers to design their supply chain networks using three key objectives: the lowest cost and environmental impact and the shortest lead time by incorporating the decision maker’s inputs.
Design/methodology/approach
– GOOG aims to suggest the best-fitted parameters for supply chain partners and manufacturing plant locations, their order allocations, and appropriate transportation modes and lot-sizes for cradle-to-gate. It integrates Fuzzy Goal Programming and weighted max-min operator for trade-off conflicting objectives and overcome fuzziness in specifying target values of individual objectives. It is solved using exact algorithm and validated using an industrial case study.
Findings
– The comparative analysis between actual, three single-objective, and multi-objective decisions showed that GOOG is capable to optimising three objectives namely cost, lead time, and environmental impact.
Research limitations/implications
– Further, GOOG requires validation for different supply chain scenarios and manufacturing strategic decisions. It can improve by including multi-echelon supply chain networks, entire life cycle and relevant environmental legislations.
Practical implications
– GOOG helps the decision makers to configuring those supply chain parameters whilst minimising those three objectives.
Social implications
– Companies can use GOOG as a tool to strategically select their supply chain that reduces their footprint and stop rebound effect which imposes significant impact to the society.
Originality/value
– GOOG includes overlooked in the previous study in order to achieve the objectives set. It is flexible for the decision makers to change the relative weightings of the inputs for those contradicting objectives.
... Similarly, Mohamed (1999) developed an MIP model for a global manufacturer operating under an exchange rate risk and showed that the multinational company's facility location decisions are significantly affected by varying exchange rates. Moreover, Vidal and Goetschalckx (2000), Bhutta et al. (2003), Mohamed and Youssef (2004), Wilhelm et al. (2005) and Civelek (2014) built similar MIP models to analyse impacts of exchange rates on global supply chain decisions including facility location, distribution, production planning and investment. In addition to the exchange rate, effects of corporate and value added taxes on global logistics network were studied in Feng and Wu (2009) with an objective of savings from tariffs and taxes. ...
... In this paper, our main focus is to investigate, specifically, impacts of exchange rate risk and transportation costs considering only four regions. Our work is similar to Bhutta et al. (2003), Mohamed and Youssef (2004) and Huang et al. (2013) in terms of formulation. However, our work is different owing to using a linear function of oil prices for transportation costs and exact calculation of the economic order quantities for the OEM and its 1st tier and 2nd tier suppliers. ...
Transportation costs and exchange rate risk have been significant factors in selection of suppliers in global supply chain management. In this study, we investigate the effects of both of these factors on a global supply chain planner's strategic decisions on working with local or international suppliers. We develop an optimisation model to analyse the impacts of transportation cost and exchange rate risks and show for a coordinated production plan for an original equipment manufacturer (OEM), 1st tier and 2nd tier suppliers located locally or globally. We specifically focus on China (Pearl River Delta and Inland regions), India (Chennai) and Mexico (Baja) for the location of the OEM and its suppliers. We show that appreciation of Chinese currency and higher oil prices would make OEMs in Inland region of China and Mexico more attractive, respectively. India is very cost effective for the global strategic planner to locate OEM if oil prices decrease significantly. Moreover, we investigate the strategic benefit of relocating the OEM, 1st tier and 2nd tier suppliers for a global supply chain planner.
... In fact, it could be detrimental to organizations investing in flexibility of some functions without proper consideration of its impacts on the other SC processes and the overall SCF (Sawhney 2006). Based upon this viewpoint, we present a classification of the Chen and Wang (1997) IMSL package Mohamed (1999) Not specified A hybrid simulation-analytic method Mohamed and Youseff (2004) LINDO solver Oh and Karimi (2006) CPLEX solver Genin et al. (2008) CPLEX solver ...
Supply chains (SCs) can be managed at many levels. The use of tactical SC planning models with multiple flexibility options can help manage the usual operations efficiently and effectively, whilst improve the SC resiliency in response to inherent environmental uncertainties. This paper defines tactical SC flexibility and identifies tactical flexibility measures and options for development of flexible SC planning models. A classification of the existing literature of SC planning is introduced that highlights the characteristics of published flexibility inclusive models. Additional classifications from the reviewed literature are presented based on the integration of flexibility options used, solution methods utilized, and real world applications presented. These classifications are helpful for identifying research gaps in the current literature and provide insights for future modeling and research efforts in the field.
... The other factors that shape relationships between one organizational unit and another are mainly external influences. These are identified in Mohamed and Youssef (2004), and include exchange rates, inflation, fragmented and saturated markets, advances in technology, and partner capacity levels. All these affect performance of cross-border manufacturing plants in one way or another. ...
Purpose
– The purpose of this paper is to consider research that has been conducted on the offshoring of manufacturing activities, and more specifically to synthesize results regarding the question of how firms integrate and govern geographically dispersed production activities.
Design/methodology/approach
– A set of 100 carefully selected articles on offshoring and offshore outsourcing of production published in international peer-reviewed journals during the past 15 years are systematically analyzed. The focus is on 34 articles that touch on issues of integration and governance of dispersed production facilities.
Findings
– Offshoring and offshore outsourcing of production is a cross-cutting subject of research. Most research is recent and largely conceptual. Furthermore, the findings suggest that the decision to offshore is often followed by the need to build more integrated operations.
Research limitations/implications
– One of the major constraining factors of this research, like many literature reviews, is a limited sampling period.
Practical implications
– The paper demonstrates the importance of both intra-firm relationships and governance in dispersed production operations. The authors suggest that new offshore plants need to learn and develop their own capabilities in new markets on one hand, while also developing governance structures to facilitate coherence within a production network on the other hand.
Originality/value
– This is a valuable paper for researchers in offshoring and global manufacturing areas. While literature reviews in other areas such as information systems offshoring and services offshoring do exist, one specific to production offshoring was lacking. This paper should be seen as a systematic and concerted effort for research and knowledge in this area.
... Athakorn [2], Burcuet al. [3], Chandrasekhar and Rajesh [4], Chandrasekhar and Rajesh [5], Jing et al. [10], Rajesh and Chandra- sekhar [16], Rohit and Chee-Chong [18], and Vaidya- nathan [21] determine objective functions to mini- mize cost. Das and Sengupta [7], and Zubair and Mohamed [22] specify objective functions to maxi- mize profit. These objective functions are usually defined shipment quantity as decision variables while single tariff of shipment are lacking. ...
... There are many methods to validate quantitative models. Caputo et al. [1], Athakorn [2], Grit and Thomas [8], Liu et al. [11], Robert et al. [17], and Zubair and Mohamed [22] validate models base on the behavior of the reality, the current situation, and historical performance or operation experience of the systems. Marcos and Patricio [8], and Hugo and Warren [9] use the opinion of experts. ...
Oil is an important energy type, especially in developing countries. Currently, Thailand’s oil consumption is in high-volumes while customers in Northern Thailand buy oil products at the highest price, therefore there is a need to increase efficiency in oil distribution systems by developing project plans and strategic policies. This study will propose new development plan of oil distribution to Northern Thailand through extended oil pipeline under single tariff policy. Its evaluation criteria is that under appropriated single tariff of pipeline transportation, it will provide benefit for public and profit for extended oil pipeline investment not less than before. To find decision true state of hypotheses, this study will generate cost oriented model formulated on linear functions and single tariff oriented model formulated on linearization of multivariable functions. Single tariff oriented model will use new decision variable “single tariff of pipeline transportation” that has never been considered before. Other than that this study will also includes cost functions of product loss and product blending on objective functions. AMPL with CPLEX will be used to solve these linear programming problems. In the process of model validation, the results will be compared with previous studies. This study will analyze and conclude that if single tariff policy is enacted in the case of oil distribution to Northern Thailand through extended oil pipeline, the appropriate single tariff of pipeline transportation that provides the best solution will be chosen from both criterions of public and extended oil pipeline investment while customers in Northern Thailand can buy oil products at nearly price in the expected year of operation.
... Several articles (Vidal and Goetschalckx, 1997 Meixell and Gargeya, 2005;Kouvelis, et al., 2006;Melo, et al., 2009) reviewed mathematical models incorporating international factors. Hodder and Jucker (1985) x x Not specified Cohen and Lee (1989) x x x x x Hardware Mohamed (1999) x x Not specified Vidal and Goetschalckx (2000) x x Not specified Bhutta et al. (2003) x x Hardware Mohamed and Youssef (2004) x Table I. Hodder and Jucker (1985) incorporated the mean and variance of prices and exchange rates. ...
... It was demonstrated that these factors significantly affect optimal global SCC decisions. Bhutta et al. (2003), Mohamed and Youssef (2004) built MIP models to discuss impacts of exchange rates and tariffs on production, distribution and investment decisions and operating profit. Considerable effects were observed for these factors. ...
... However, it can be easily extended to incorporate the scenarios of capacity expansion and reduction (Melo, et al., 2006). The model is formulated by using parameters and variables (Melachrinoudis and Min, 2000;Bhutta, et al., 2003;Mohamed and Youssef, 2004) defined as follows. ...
Purpose
Global manufacturers have faced unprecedented cost pressures in China because of Chinese currency appreciation, rising labour costs, higher oil prices and reduced value‐added tax rebates. This paper aims to reassess the decision of operating global manufacturing facilities in China.
Design/methodology/approach
A mixed integer programming model is developed for a typical global manufacturing supply chain that includes production in the Pearl River Delta region and trade in Hong Kong. A case study with a footwear product is used to illustrate model application and present detailed analyses.
Findings
The modelling results affirm the need of relocating labour‐intensive production that mainly competes on low costs. Nevertheless, coastal China offers considerable benefits from industrial clustering and a logistics advantage in comparison with inland China and Asian countries where labour costs are still relatively low. Hong Kong remains a robust location choice for trade operations because of its favourable tax policies.
Practical implications
Retaining production in China faces high risks from Chinese currency appreciation, while relocation to lower‐cost Asian countries is more vulnerable to risks from high oil prices. An intermediate trade operation in Hong Kong can be used to hedge against risks from unfavourable tax policy changes at manufacturing locations.
Originality/value
China has risen to an important position in global manufacturing because of its cost advantages. This paper analyzes the new phenomenon of dramatically increasing cost pressures in China. It develops a first‐of‐its‐kind supply chain configuration model for the popular front‐shop‐back‐factory business model in China.
... Les autres travaux recensés au niveau tactique, tiennent compte du problème multi-produit et multi-périodique de production. Timpe and Kallrath (2000), Mohamed (1999), Mohamed and Youssef (2004) ainsi que Jolayemi and Olorunniwo (2004) développent des modèles qui visent la maximisation du profit total en intégrant des décisions de production et de distribution. Pour Mohamed (1999) Les décisions incluent la détermination des quantités à fabriquer et à stocker ainsi que leur affectation aux centres de productions et aux différents marchés. ...
Through this thesis, we are interested in the textile industry. The actors in this field of industry, which is often characterized by global supply chains, must adapt to a dynamic demand for short-life-cycle products. These characteristics reinforce the need to be imperative in a highly competitive environment by controlling costs and resources of production and logistics and by having a good knowledge of the market to which it is necessary to constantly know how to adapt. In this thesis, basing on the context of a Tunisian textile industry, we focus on production and distribution planning using mathematical programming. These decisions are made by the manufacturer who provides local and overseas retailers. He is fully committed to meet two types of orders: (i) pre-season orders of future collections, often with a large delivery lead time and (ii) replenishment orders, often with shorter due dates, occurring over the season to fill in stock outs or to replace unsold products. We propose an integrated planning method that optimizes both the production and distribution decisions. This method is characterized by an anticipation of some flexibility in the tactical production plan to better place the unplanned and urgent newly arrived demands at the operational level. Using the data provided by our industrial partner, we were able to demonstrate that such an approach allows remarkable cost savings, reaching 10% for the cases studied. Then, we assume that a partnership agreement has allowed the manufacturer to follow the evolution of demand information concerning the products being sold to their retailers. They can then use this information to build forecast model to anticipate at best the flexibility a priori of production plans. Under this assumption, we demonstrate that a cost cutting of 15% is attained. The work of this thesis was validated by data provided by a Tunisian textile-apparel company. We show, however, that it can be widely applied to different industrial contexts.
... Due to the lag, the decision is risky. In case the capacity is not fully disposed in the manufacturing process, sustaining the new asset capacity generates expenses, which include labour costs, maintenance etc. [7]. ...
Every manufacturing company has to evaluate its production capacity to fulfil the demand for its products. This paper outlines tools and methodology of the capacity planning, which help to decide on which production means the company should invest to enhance its capacity and not derail its competitiveness.
