Mpc framework for supply chain management integrating on-time delivery and transport management

Abstract

Currently, there is a challenge in Supply Chain Management (SCM) which consists on the coordination of efforts to correspond to clients demands in the presence of conflicting goals of the various chain actors. On the one hand, suppliers, manufacturers, and retailers are interested in providing to customers the right product, in the right amount, at the right time, for the right price, and at the right place. On the other hand, transport providers (TP) want to efficiently allocate their fleets and minimise the number of movements. To solve the trade-off between (i) on-time delivery, and (ii) efficient transportation management, this work presents a novel dynamic approach for real-time SCM integrating transportation operations, based on a model predictive control framework. Focusing on the discrete time case, a flow perspective is taken in which the material flow is decomposed into flow of goods and flow of transportation vehicles to model the conflicting views of the various actors. The framework performance is illustrated with simulation studies considering two-echelon vertical integrated chain with manufacturing.