Optimizing Safety Stock Placement in General Network Supply Chains
Author(s)
Graves, Stephen C.
Lesnaia, Ekaterina
Date Issued
January 2004
Series/Report no.
Innovation in Manufacturing Systems and Technology (IMST);
Abstract
In the paper, we minimize the holding cost of the safety stock held in a supply chain modeled as a general network. By our assumption, the demand is bounded by a concave function. This fact allows us to formulate the problem as a deterministic optimization. We minimize a concave function over a discrete polyhedron. The main goal of the paper is to describe an algorithm to solve the problem without assuming any particular structure of the underlying supply chain. The algorithm is a branch and bound algorithm.
Subjects
safety stock placement
supply chains
deterministic optimization
branch and bound algorithms
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