Journal
TRANSPORTATION RESEARCH PART E-LOGISTICS AND TRANSPORTATION REVIEW
Volume 95, Issue -, Pages 143-163Publisher
PERGAMON-ELSEVIER SCIENCE LTD
DOI: 10.1016/j.tre.2016.09.009
Keywords
Supply chain design; Transportation disruptions; Expedited shipment; Inventory management; Lagrangian relaxation
Categories
Funding
- U.S. National Science Foundation through Grants CMMI [1558889, 1541130, 1638355]
- National Center for Intermodal Transportation for Economic Competitiveness (US Tier I University Transportation Center) through Grant [13091085]
- National Natural Science Foundation of China through Grant [51478151]
- Direct For Computer & Info Scie & Enginr
- Division Of Computer and Network Systems [1638355] Funding Source: National Science Foundation
- Directorate For Engineering
- Div Of Civil, Mechanical, & Manufact Inn [1541130, 1634738] Funding Source: National Science Foundation
- Div Of Civil, Mechanical, & Manufact Inn
- Directorate For Engineering [1558889] Funding Source: National Science Foundation
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This paper studied the design of a two-echelon supply chain where a set of suppliers serve a set of terminals that receive uncertain customer demands. In particular, we considered probabilistic transportation disruptions that may halt product supply from certain suppliers. We formulated this problem into an integer nonlinear program to determine the optimal system design that minimizes the expected total cost. A customized solution algorithm based on Lagrangian relaxation was developed to efficiently solve this model. Several numerical examples were conducted to test the proposed model and draw managerial insights into how the key parameters affect the optimal system design. (C) 2016 Elsevier Ltd. All rights reserved.
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