Resources Constraints, Capacity Limitations and Supply Information Sharing in a Supply Chain

Tien-Sheng Lee, Chinese University of Hong Kong
Qiang Zhou, Hong Kong Shue Yan University

ABSTRACT
Previous literature already made a wide variety of insightful explorations into demand-side information sharing. However, research efforts have rarely been made into supply-side information sharing. In this paper, a simulation model with mixed-integer programming was built to simulate ordering, production planning, and supplying activities with and without supply information sharing in a three-level capacitated supply chain consisting of multiple suppliers, one manufacturer and multiple retailers. The simulation results indicate that supply information sharing can significantly reduce total cost and enhance service level of the whole supply chain and its members. In addition, the impacts of supply information sharing on the supply chain performance are heavily moderated by capacity limitations and resources constraints. The findings of this paper provide important reference for supply chain managers to implement supply information sharing in order to improve decision-making process, reduce uncertainties, and increase visibility in supply chain operations.

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Updated 07/09/2013