Volume 52, Number 4-5, October–December 2018
|Page(s)||1377 - 1396|
|Published online||06 December 2018|
Reducing the Bullwhip effect in a supply chain network by application of optimal control theory
School of Industrial Engineering, College of Engineering, University of Tehran,
2 Faculty of Engineering, Urmia University, Urmia, West Azerbaijan Province, Iran.
3 School of Electrical and Computer Engineering, Control and Intelligent Processing Centre of Excellence, University of Tehran, Tehran, Iran.
* Corresponding author: firstname.lastname@example.org
Accepted: 11 March 2018
Controlling the bullwhip effect and reducing the propagated inventory levels throughout the supply chain layers has an important role in reducing the total inventory costs of a supply chain. In this study, an optimal controller that considers demand as control variable is designed to dampen propagated inventory fluctuations for each node throughout the supply chain network. The model proves to be very useful in revealing the dynamic characteristics of the chain and provides a proper interface to study decisions taken into account at each node of the supply chain in different periods by decision makers (DMs). In the proposed approach, two feedback loops and online updated values of net stock quantities are used for calculation of the orders. To investigate the efficiency of the proposed approach, a real case of bicycle industry is conducted. The acquired results justify the efficiency of the proposed approach in controlling and dampening the bullwhip effect and reducing inventory levels, net stock quantities and inventory attributed costs throughout the supply chain network layers.
Mathematics Subject Classification: 49N90 / 37N40 / 47N10 / 78M50
Key words: Bullwhip effect / optimal control / supply chain management / inventory control / bicycle industry
© EDP Sciences, ROADEF, SMAI 2018
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