Optimal expediting decisions in a continuous-stage serial supply chain

Peter Berling and Victor Martinez de Albeniz ()
Additional contact information
Peter Berling: Lund University
Victor Martinez de Albeniz: IESE Business School, Postal: Research Division, Av Pearson 21, 08034 Barcelona, SPAIN

No D/906, IESE Research Papers from IESE Business School

Abstract: In this paper, we analyze expediting decisions in a continuous-time, continuous-stage serial supply chain facing a Poisson demand process. For each unit in the chain, one must decide at which speed it should be moved downstream, given the state of the system, so as to minimize total supply chain costs. We decompose the problem into a set of one-dimensional subproblems that can be easily solved and characterize the optimal expediting policy: under quite general assumptions, the optimal speed of a given unit accelerates upstream, and then slows down downstream. We finally provide a case study where we estimate the benefits of expediting compared to a fixed transportation speed and show them to be significant.

Keywords: lead-time management; optimal control; unit-tracking decomposition (search for similar items in EconPapers)
Pages: 31 pages
Date: 2011-02-03
New Economics Papers: this item is included in nep-agr
References: Add references at CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
http://www.iese.edu/research/pdfs/DI-0906-E.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ebg:iesewp:d-0906

Access Statistics for this paper

More papers in IESE Research Papers from IESE Business School IESE Business School, Av Pearson 21, 08034 Barcelona, SPAIN. Contact information at EDIRC.
Bibliographic data for series maintained by Noelia Romero ().