State-space proportional-integral inventory replenishment practices for bullwhip effect investigation in supply chains

C. I. Papanagnou, P. Tzionas

Research output: Chapter in Book/Published conference outputConference publication

Abstract

Inventory replenishment practices play significant role in supply chain networks and they are strongly associated with overall supply chain performance. This paper presents a state-space model of a stochastic series multi-node supply chain, controlled via local proportional-integral inventory replenishment policies. The model is triggered by identically distributed and uncorrelated random variables which represent uncertain customer demand. The proposed model is analyzed under stationarity, provided that control parameters belong to a certain range which is clearly specified. Simple recursive techniques are developed to calculate explicitly the associated covariance matrix in closed parametric form. This allows to analyze the effect of control parameters in the inventory practices on the bullwhip effect. It is shown that proportional-integral replenishment practices can be applied to explain in qualitative terms the main performance and stability properties of supply chains.

Original languageEnglish
Title of host publicationProceedings of IEEM 2009 - IEEE International Conference on Industrial Engineering and Engineering Management
Pages558-562
Number of pages5
DOIs
Publication statusPublished - 8 Jan 2010
EventIEEE International Conference on Industrial Engineering and Engineering Management, IEEM 2009 - Hong Kong, China
Duration: 8 Dec 200911 Dec 2009

Publication series

NameIEEM Proceedings
PublisherIEEE

Conference

ConferenceIEEE International Conference on Industrial Engineering and Engineering Management, IEEM 2009
Country/TerritoryChina
CityHong Kong
Period8/12/0911/12/09

Keywords

  • Bullwhip effect
  • Control theory
  • Covariance matrix
  • Inventory control
  • Supply chain management

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