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- All Subjects: Business logistics
- Creators: Mirchandani, Pitu
- Resource Type: Text
- Status: Published
Description
Today's competitive markets force companies to constantly engage in the complex task of managing their demand. In make-to-order manufacturing or service systems, the demand of a product is shaped by price and lead times, where high price and lead time quotes ensure profitability for supplier, but discourage the customers from placing orders. Low price and lead times, on the other hand, generally result in high demand, but do not necessarily ensure profitability. The price and lead time quotation problem considers the trade-off between offering high and low prices and lead times. The recent practices in make-to- order manufacturing companies reveal the importance of dynamic quotation strategies, under which the prices and lead time quotes flexibly change depending on the status of the system. In this dissertation, the objective is to model a make-to-order manufacturing system and explore various aspects of dynamic quotation strategies such as the behavior of optimal price and lead time decisions, the impact of customer preferences on optimal decisions, the benefits of employing dynamic quotation in comparison to simpler quotation strategies, and the benefits of coordinating price and lead time decisions. I first consider a manufacturer that receives demand from spot purchasers (who are quoted dynamic price and lead times), as well as from contract customers who have agree- ments with the manufacturer with fixed price and lead time terms. I analyze how customer preferences affect the optimal price and lead time decisions, the benefits of dynamic quo- tation, and the optimal mix of spot purchaser and contract customers. These analyses necessitate the computation of expected tardiness of customer orders at the moment cus- tomer enters the system. Hence, in the second part of the dissertation, I develop method- ologies to compute the expected tardiness in multi-class priority queues. For the trivial single class case, a closed formulation is obtained. For the more complex multi-class case, numerical inverse Laplace transformation algorithms are developed. In the last part of the dissertation, I model a decentralized system with two components. Marketing department determines the price quotes with the objective of maximizing revenues, and manufacturing department determines the lead time quotes to minimize lateness costs. I discuss the ben- efits of coordinating price and lead time decisions, and develop an incentivization scheme to reduce the negative impacts of lack of coordination.
ContributorsHafizoglu, Ahmet Baykal (Author) / Gel, Esma S (Thesis advisor) / Villalobos, Jesus R (Committee member) / Mirchandani, Pitu (Committee member) / Keskinocak, Pinar (Committee member) / Runger, George C. (Committee member) / Arizona State University (Publisher)
Created2012
Description
In this dissertation, an innovative framework for designing a multi-product integrated supply chain network is proposed. Multiple products are shipped from production facilities to retailers through a network of Distribution Centers (DCs). Each retailer has an independent, random demand for multiple products. The particular problem considered in this study also involves mixed-product transshipments between DCs with multiple truck size selection and routing delivery to retailers. Optimally solving such an integrated problem is in general not easy due to its combinatorial nature, especially when transshipments and routing are involved. In order to find out a good solution effectively, a two-phase solution methodology is derived: Phase I solves an integer programming model which includes all the constraints in the original model except that the routings are simplified to direct shipments by using estimated routing cost parameters. Then Phase II model solves the lower level inventory routing problem for each opened DC and its assigned retailers. The accuracy of the estimated routing cost and the effectiveness of the two-phase solution methodology are evaluated, the computational performance is found to be promising. The problem is able to be heuristically solved within a reasonable time frame for a broad range of problem sizes (one hour for the instance of 200 retailers). In addition, a model is generated for a similar network design problem considering direct shipment and consolidation within the same product set opportunities. A genetic algorithm and a specific problem heuristic are designed, tested and compared on several realistic scenarios.
ContributorsXia, Mingjun (Author) / Askin, Ronald (Thesis advisor) / Mirchandani, Pitu (Committee member) / Zhang, Muhong (Committee member) / Kierstead, Henry (Committee member) / Arizona State University (Publisher)
Created2013