AQFC2015

Managing Multi-Echelon Supply Chains with Guaranteed Service and Expediting

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Department of Systems Engineering and Engineering
Management
The Chinese University of Hong Kong

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Date: 4:30pm-5:30pm, October 28 (Friday), 2016

Title: Managing Multi-Echelon Supply Chains with Guaranteed Service
and Expediting

Speaker: Dr. Yimin Yu, City University of Hong Kong

Abstract:
We consider the optimal coordination of inventory ordering and
expediting in serial supply chains with guaranteed service. Any new
customer order is guaranteed to be fulfilled within a fixed time. We
allow inventory expediting to provide in-time service. We show that a
calibrated echelon base stock policy is optimal for the ordering
decisions: the optimal calibrated echelon base stock level is either a
constant or a variable of demand state but independent of inventory
state. For the inventory expediting and demand fulfillment strategy,
we find that a weakly coupled rationing level policy is optimal and
the optimal weakly coupled rationing level is either a constant or a
variable of inventory state but independent of demand state. We obtain
our results by using generalized weak decomposition, which allows us
to obtain the optimal policies efficiently. Our results are robust to
systems with stochastic sequential leadtimes. We also numerically
investigate the value of inventory expediting in serial systems with
guaranteed service. We find that even infrequent inventory expediting
with 3.4% expediting probability can lower the system cost by 37%. In
other words, (even a little bit) inventory expediting is recommended
for serial supply chains with guaranteed service. Finally, based on
the properties of the optimal policy, we design a coordination
mechanism to decentralize the supply chains with guaranteed service.

Biography:
Yimin Yu is an Assistant Professor in the Department of Management
Sciences, College of Business at City University of Hong Kong. He
received his Ph.D. in Industrial Engineering from the University of
Minnesota, Twin Cities. His research focuses on supply chain
management, the interfaces of operations and marketing. This includes
topics on optimal design of inventory-production systems and the
analysis of emerging operations/supply chain strategies. His
publications have appeared in Marketing Science, Production and
Operations Management, and others.

Everyone is welcome to attend the talk!

Venue: Room 513,
William M.W. Mong Engineering Building (ERB),
(Engineering Building Complex Phase 2)
The Chinese University of Hong Kong.

The talk will be hosted by:
Prof. Xiting Gong,
Department of Systems Engineering and Engineering Management,
The Chinese University of Hong Kong,
E-mail: xtgong@se.cuhk.edu.hk
Homepage: http://www1.se.cuhk.edu.hk/~xtgong/

SEEM-5201 Website: http://seminar.se.cuhk.edu.hk
Email: seem5201@se.cuhk.edu.hk

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Date: 
Friday, October 28, 2016 - 08:30 to 09:30