Abstract
In this paper, we consider a serial supply chain (SC) operating with deterministic and known customer demands and costs of review or orders, holding, and backlog at every installation over a finite planning horizon. We present an evaluation of two order policies: Periodic-review order-up-to S policy (i.e., (T, S) policy), and (s, S) policy. We first present a mathematical programming model to determine optimal re-order point and base-stock for every member in the SC. By virtue of the computational complexity associated with the mathematical model, we present genetic algorithms (GAs) to determine the order policy parameters, s and S for every stage. We compare the performances of GAs (for obtaining installation s and S) with the mathematical model for the periodic-review order-up-to (T, S) policy that obtains in its class optimal review periods and order-up-to levels. It is observed that the (s, S) policy emerges to be mostly better than the (T, S) policy.
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Acknowledgments
The authors thank the two reviewers for their suggestions to improve the paper. The second author gratefully acknowledges the Alexander von Humboldt Foundation for supporting him to carry out a part of this work at the University of Passau.
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Sethupathi, P.V.R., Rajendran, C., Ziegler, H. (2014). A Comparative Study of Periodic-Review Order-Up-To (T, S) Policy and Continuous-Review (s, S) Policy in a Serial Supply Chain Over a Finite Planning Horizon. In: Ramanathan, U., Ramanathan, R. (eds) Supply Chain Strategies, Issues and Models. Springer, London. https://doi.org/10.1007/978-1-4471-5352-8_6
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DOI: https://doi.org/10.1007/978-1-4471-5352-8_6
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