×

The value of information sharing in a two-stage supply chain with production capacity constraints. (English) Zbl 1055.90030

Summary: We consider a simple two-stage supply chain with a single retailer facing i.i.d. demand and a single manufacturer with finite production capacity. We analyze the value of information sharing between the retailer and the manufacturer over a finite time horizon. In our model, the manufacturer receives demand information from the retailer even during time periods in which the retailer does not order. To analyze the impact of information sharing, we consider the following three strategies: (1) the retailer does not share demand information with the manufacturer; (2) the retailer does share demand information with the manufacturer and the manufacturer uses the optimal policy to schedule production; (3) the retailer shares demand information with the manufacturer and the manufacturer uses a greedy policy to schedule production. These strategies allow us to study the impact of information sharing on the manufacturer as a function of the production capacity, and the frequency and timing in which demand information is shared.

MSC:

90B30 Production models
90C39 Dynamic programming
90B05 Inventory, storage, reservoirs
PDFBibTeX XMLCite
Full Text: DOI

References:

[1] and The operational benefits of information sharing and vendor managed inventory (VMI) programs, Working Paper, Washington University, St. Louis, MO, 1998.
[2] Cachon, Management Sci 46 pp 1032– (2000)
[3] Federgruen, Math Oper Res 11 pp 208– (1986)
[4] Gavirneni, Management Sci 45 pp 16– (1999)
[5] and Analysis of inventory systems. Prentice-Hall, Englewood Cliffs, NJ, 1963.
[6] and Stochastic models in operations research, McGraw-Hill, New York, 1984, Vol. 2.
[7] and ?Single-product, single-location models,? Handbooks in operations research and management science, North-Holland, Amsterdam, 1993, Vol. 4.
[8] and Designing and managing the supply chain, Irwin/McGraw-Hill, Chicago, IL, 1999.
[9] Stein, Inform Week (1998)
This reference list is based on information provided by the publisher or from digital mathematics libraries. Its items are heuristically matched to zbMATH identifiers and may contain data conversion errors. In some cases that data have been complemented/enhanced by data from zbMATH Open. This attempts to reflect the references listed in the original paper as accurately as possible without claiming completeness or a perfect matching.