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Supply System Dynamics : Distributed Control in Supply Chains and Networks

Markus Schwaninger & Peter Vrhovec

abstract The purpose of this article is to make a contribution to a more effective management for supply chains and networks, which we are subsuming under the title supply systems. We conceive of supply systems management as the design, control, and development of logistics along the value chain or in value networks. In this article, we concentrate on control, i.e., the regulation and steering of supply systems from production to customer and vice versa, with the help of system dynamics modeling and simulation. Traditionally, supply chain management has been heavily supported by discrete event simulation and optimization models on very detailed levels. Established tools, e.g., Manufacturing Resources Planning, Enterprise Resources Planning, and Production Planning Systems, have emphasized highly specialized functions, such as the planning for optimal capacity use and achievement of delivery goals, via the sequencing, scheduling, and dispatching of individual orders, or the global allocation of resources but without the possibility to evaluate different outcomes of the allocation process. In the quest for efficiency and effectiveness, new approaches to control, which lead beyond these functions of disposition, are needed. We present a model that combines two systemic methodologies that operate on higher levels of aggregation and complement each other: system dynamics to model and simulate the supply chain and cybernetic control to apply control-theoretical concepts, namely proportional, derivative, and integral control, in a combined mode as well as according to a recursive logic of distributed control. This way, substantial improvements in both efficiency and effectiveness can be achieved, and ultimately organizational viability can be enhanced.
   
type journal paper
   
keywords Supply Chain Management, Supply Networks, System Dynamics
   
language English
kind of paper journal article
date of appearance 1-7-2006
journal Cybernetics and Systems
publisher Taylor & Francis (Washington, DC)
ISSN 0196-9722
ISSN (online) 1087-6553
DOI 10.1080/01969720600683338
volume of journal 37
number of issue 5
page(s) 375-415
review double-blind review
   
citation Schwaninger, M., & Vrhovec, P. (2006). Supply System Dynamics : Distributed Control in Supply Chains and Networks. Cybernetics and Systems, 37(5), 375-415, DOI:10.1080/01969720600683338.