Material management in decentralized supply chains
Operations Research
Information distortion in a supply chain: the bullwhip effect
Management Science - Special issue on frontier research in manufacturing and logistics
Computers and Operations Research
Optimal Policies for Multi-Echelon Inventory Problems with Batch Ordering
Operations Research
Supply Chain Inventory Management and the Value of Shared Information
Management Science
A reinforcement learning model for supply chain ordering management: An application to the beer game
Decision Support Systems
Case-based reinforcement learning for dynamic inventory control in a multi-agent supply-chain system
Expert Systems with Applications: An International Journal
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Inventory control plays an important role in supply chain management. Properly controlled inventory can satisfy customers' demands, smooth the production plans, and reduce the operation costs; yet failing to budget the inventory expenses may lead to serious consequences. The bullwhip effect, observed in many supply chain management cases, causes excessive inventory due to information distortion, i.e. the order amount is exaggerated while a minor demand variation occurs, and the information amplified dramatically as the supply chain moves to the upstream. In this paper, one of the main causes of bullwhip effect, order batching, is considered. A simplified two-echelon supply chain system, with one supplier and one retailer that can choose different replenishment policies, is used as a demonstration. Two types of inventory replenishment methods are considered: the traditional methods (the event-triggered and the time-triggered ordering policies), and the statistical process control (SPC) based replenishment method. The results show that the latter out-performs the traditional method in the categories of inventory variation, and in the number of backlog when the fill-rate of the prior model is set to be 99%. This research provides a different approach to inventory cost-down other than the common methods like: information sharing, order batch cutting, and lead time reduction. By choosing a suitable replenishment policy, the number of backorder and the cost of inventory can be reduced.