An optimization and discrete event simulation framework for evaluating delivery performance in Swedish wood supply chains under stochastic weather variations

Abstract

Delivery performance in wood supply chains is affected by carrying capacity on forest roads. Stochastic weather variations affect carrying capacity of roads and accessibility of harvested wood on landings. In Sweden, annual harvest scheduling is usually based on four seasons and road accessibility classes are set to match these seasons. In reality, road accessibility changes depend on weather variations not season. This causes a risk of poor delivery performance. Delivery performance is evaluated using two performance indicators, backorders (orders not delivered on time) and lead time (time from harvesting to delivery to mill). A data-analytic framework, combining optimization and simulation, is proposed to assess and evaluate these performance indicators for the wood supply chain under stochastic weather variations. An optimization model is used to generate a feasible harvest schedule for expected weather. This is thereafter evaluated given various weather scenarios using a discrete-event simulation model. The combination of optimization and discrete-event simulation is used to assess delivery performance over time, and changes in road accessibility caused by weather variation. An expected decrease in road accessibility implies a stable delivery performance, while an unexpected decrease causes a reduced delivery performance.