Assessing the supply chain performance: a causal analysis

Erkan Bayraktar (), Kazim Sari (), Ekrem Tatoglu (), Selim Zaim () and Dursun Delen ()
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Erkan Bayraktar: American University of the Middle East
Kazim Sari: Beykent University
Ekrem Tatoglu: University of Sharjah
Selim Zaim: Istanbul Sehir University
Dursun Delen: Oklahoma State University

Annals of Operations Research, 2020, vol. 287, issue 1, No 3, 37-60

Abstract: Abstract Measuring the performance-related factors of a unit within a supply-chain is a challenging problem, mainly because of the complex interactions among the members governed by the supply chain strategy employed. Synergistic use of discrete-event simulation and structural equation modeling allows researchers and practitioners to analyze causal relationships between order-fulfillment characteristics of a supply-chain and retailers’ performance metrics. In this study, we model, simulate, and analyze a two-level supply-chain with seasonal linear demand, and using the information therein, develop a causal model to measure the links/relationships among the order-fulfillment factors and the retailer’s performance. According to the findings, of all the order-fulfillment characteristics of a supply-chain, the forecast inaccuracy was found to be the most important in mitigating the bullwhip effect. Concerning the total inventory cost and fill-rate as performance indicators of retailers, the desired service level had the highest priority, followed by the lead-time and forecast inaccuracy, respectively. To reduce the total inventory cost, the bullwhip effect seems to have the lowest priority for the retailers, as it does not appear to have a significant impact on the fill rate. Although seasonality (to some extent) influences the retailer’s performance, it does not seem to have a significant impact on the ranking of the factors affecting retailers’ supply-chain performance; except for the case where the backorder cost is overestimated.

Keywords: SCM; Retailers’ performance; Service level; Bullwhip effect; Causal analysis (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (3)

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DOI: 10.1007/s10479-019-03457-y

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