Balancing product flow and synchronizing transportation
Name
1014341126-MIT.pdf
Description
Full printable version
Size
3.67 MB
Format
Adobe PDF
Checksum (MD5)
8c192e23067d4c441a345dab1173300c
Author(s)
Andleigh, Priya
Bullock, Jeffrey Scott
Advisor(s)
Ahmad Hemmati and Chris Caplice.
Date Issued
2017
Publisher
Massachusetts Institute of Technology
Abstract
Traditionally, production and transportation planning processes are managed separately in organizations. In such arrangements, order processing, load planning, and transportation scheduling are often done sequentially, which can be time consuming. Establishing a proactive steady flow of products between two nodes of a supply chain can bypass this order-plan-ship process. A steady flow of products can reduce transportation costs, increase cross-dock productivity, and reduce bullwhip effect upstream in the supply chain. This thesis develops an analytical framework to calculate this steady flow. The determination of eligible SKUs in this approach is performed by analyzing each SKU's historical and forecasted demand. The level of flow of each SKU is found using optimization with the objective of maximizing total savings. The methodology was tested on a plant-to-warehouse lane of a fast moving consumer goods company. The relationship between demand characteristics and optimal steady flow was studied. It was found that as the coefficient of variation decreases, the optimum steady flow moves closer to the mean of the non-zero demand and selected forecast over the model horizon. The methodology developed in the research, with its potential to reduce transportation cost and improve warehouse productivity, also presents the opportunity for new and innovative contract types with transportation providers.
Description
Thesis: M. Eng. in Supply Chain Management, Massachusetts Institute of Technology, Supply Chain Management Program, 2017.
Cataloged from PDF version of thesis.
Includes bibliographical references (page 46).
Subjects
Supply Chain Management Program.
MIT Department
Massachusetts Institute of Technology. Supply Chain Management Program
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