A model for comparing sourcing strategies for parts in long life cycle products subject to long-term supply chain disruptions

2013 ◽  
Vol 6 (3) ◽  
pp. 228 ◽  
Author(s):  
Varun J. Prabhakar ◽  
Peter Sandborn
Keyword(s):  
Supply Chain ◽  
Life Cycle ◽  
Supply Chain Disruptions ◽  
Sourcing Strategies ◽  
Long Life

Optimizing Part Sourcing Strategies for Low-Volume, Long Life Cycle Products Using Second Sourcing and Part Hoarding

2013 ◽  
Author(s):  
Varun J. Prabhakar ◽  
Hannah Allison ◽  
Peter Sandborn ◽  
Bo Eriksson
Keyword(s):  
Supply Chain ◽  
Life Cycle ◽  
Mitigation Strategies ◽  
Supply Chain Disruptions ◽  
Sourcing Strategies ◽  
Study Results ◽  
Future Time Period ◽  
Long Life ◽  
The Impact

Long life cycle products, commonly found in aviation, medical and critical infrastructure applications, are often fielded and supported for long periods of time (20 years or more). The manufacture and support of long life cycle products rely on the availability of suitable parts, which over long periods of time, leaves the parts susceptible to supply chain disruptions such as suppliers exiting the market, allocation issues, counterfeit part risks, and part obsolescence. Proactive mitigation strategies exist that can reduce the impact of supply chain disruptions. One solution to mitigating the supply chain risk is the strategic formulation of part sourcing strategies (optimally selecting one or more suppliers from which to purchase parts over the life of the part’s use within a product or organization). Strategic sourcing offers a way of avoiding the risk of part unavailability (and its associated penalties), but at the expense of qualification and support costs for multiple suppliers. An alternative disruption mitigation strategy is hoarding. Hoarding involves stocking enough parts in inventory to satisfy the forecasted part demand (for both manufacturing and maintenance requirements) of a fixed future time period. This excess inventory provides a buffer that reduces the effect of supply chain disruptions on the part total cost of ownership (TCO), but increases the total holding cost. This paper presents a method of performing tradeoff analyses and identifying the optimal combination of second sourcing and hoarding for a specific part and product scenario. A case study was performed to examine the effects of hoarding on both single and second sourced parts. The case study results show that hoarding can contribute to a decrease in the cumulative TCO and a decrease in its variance.

A Model for Making Part Sourcing Decisions for Long Life Cycle Products

2011 ◽  
Author(s):  
Varun J. Prabhakar ◽  
Peter Sandborn
Keyword(s):  
Supply Chain ◽  
Life Cycle ◽  
Life Cycle Cost ◽  
Critical Infrastructure ◽  
Cost Effective ◽  
Sourcing Strategies ◽  
Support Costs ◽  
Long Life ◽  
Sourcing Decisions ◽  
Linear Regulators

Long life cycle products, commonly found in aviation, medical and critical infrastructure applications, are often fielded and supported for long periods of time (20 years or more). The manufacture and support of long life cycle products rely on the availability of suitable parts, which over long periods of time, leaves the parts susceptible to a number of possible supply chain disruptions such as suppliers exiting the market, counterfeit part risks, and part obsolescence. One solution to mitigating the supply chain risk is the strategic formulation of suitable part sourcing strategies (optimally selecting one or more suppliers from which to purchase parts over the life of the part’s use within a product or within an organization). Strategic sourcing offers one way of avoiding the risk of part unavailability (and its associated penalties), but at the possible expense of qualification and support costs for multiple suppliers. Existing methods used to study part sourcing decisions are procurement-centric where cost tradeoffs focus on part pricing, negotiation practices and purchase volumes. These studies are commonplace in strategic parts management for short life cycle products; however, conventional procurement-centric approaches offer only a limited view when assessing parts used in long life cycle products. Procurement-driven decision-making provides little to no insight into the accumulation of life cycle cost (attributed to the adoption and use of the part), which can be significantly larger than procurement costs in long life cycle products. This paper presents a new life cycle modeling approach to quantify risk that enables cost effective part sourcing strategies. The method quantifies obsolescence risk as “annual expected total cost of ownership (TCO) per part site” modeled by estimating the likelihood of obsolescence and using that likelihood to determine the TCO allowing sourcing strategies to be compared on a life cycle cost basis. The method is demonstrated for electronic parts in an example case study of linear regulators and shows that when procurement and inventory costs are small contributions to the part’s TCO, the cost of qualifying and supporting a second source outweighs the benefits of extending the part’s effective procurement life.

scholarly journals The Nutritious Supply Chain: Optimizing Humanitarian Food Assistance

2021 ◽  
pp. ijoo.2019.0047
Author(s):  
Koen Peters ◽  
Sérgio Silva ◽  
Rui Gonçalves ◽  
Mirjana Kavelj ◽  
Hein Fleuren ◽  
...  
Keyword(s):  
Supply Chain ◽  
Programming Model ◽  
Food Assistance ◽  
Decision Makers ◽  
Mixed Integer ◽  
Sourcing Strategies ◽  
Humanitarian Agency ◽  
Operational Excellence ◽  
Functional Areas

The World Food Programme (WFP) is the largest humanitarian agency fighting hunger worldwide, reaching approximately 90 million people with food assistance across 80 countries each year. To deal with the operational complexities inherent in its mandate, WFP has been developing tools to assist its decision makers with integrating supply chain decisions across departments and functional areas. This paper describes a mixed integer linear programming model that simultaneously optimizes the food basket to be delivered, the sourcing plan, the delivery plan, and the transfer modality of a long-term recovery operation for each month in a predefined time horizon. By connecting traditional supply chain elements to nutritional objectives, we are able to make significant breakthroughs in the operational excellence of WFP’s most complex operations. We show three examples of how the optimization model is used to support operations: (1) to reduce the operational costs in Iraq by 12% without compromising the nutritional value supplied, (2) to manage the scaling-up of the Yemen operation from three to six million beneficiaries, and (3) to identify sourcing strategies during the El Niño drought of 2016.

The Application of Product Platform Design to the Reuse of Electronic Components Subject to Long-Term Supply Chain Disruptions

2008 ◽  
Author(s):  
Peter Sandborn ◽  
Varun Prabhakar ◽  
Bo Eriksson
Keyword(s):  
Supply Chain ◽  
Economies Of Scale ◽  
Electronic System ◽  
Product Platform ◽  
Electronic Components ◽  
Platform Design ◽  
Supply Chain Disruptions ◽  
Multiple Products ◽  
Electronic Parts

Component reuse in multiple products has become a popular way to take advantage of the economies of scale across a family of products. Amongst electronic system developers there is a desire to use common electronic parts (chips, passive components, and other parts) in multiple products for all the economy of scale reasons generally attributed to platform design. However, the parts in electronic systems (especially those manufactured and supported over significant periods of time), are subject to an array of long-term lifecycle supply chain disruptions that can offset savings due to part commonality depending on the availability of finite resources to resolve problems on multiple products concurrently. In this paper we address the application of product platform design concepts to determine the best reuse of electronic components in products that are subject to long-term supply chain disruptions such as reliability and obsolescence issues. A detailed total cost of ownership model for electronic parts is coupled with a finite resource model to demonstrate that, from a lifecycle cost viewpoint, there is an optimum quantity of products that can use the same part beyond which costs increase. The analysis indicates that the optimum part usage is not volume dependent, but is dependent on the timing of the supply chain disruptions. This work indicates that the risk and timing of supply chain disruptions should be considered in product platform design.

scholarly journals Recovering Global Supply Chains from Sourcing Interruptions: The Role of Sourcing Strategy

2021 ◽  
Author(s):  
Nitish Jain ◽  
Karan Girotra ◽  
Serguei Netessine
Keyword(s):  
Supply Chain ◽  
Supply Chains ◽  
Empirical Evidence ◽  
Large Scale ◽  
Problem Definition ◽  
Supply Chain Design ◽  
Global Supply Chains ◽  
Sourcing Strategies ◽  
The Impact

Problem definition: Fast recovery from sourcing interruptions is a key objective for global supply chains and for business continuity professionals. In this paper, we study the impact of different supply chain strategies—supplier diversification and the use of long-term relationships—on the ability of a supply chain to recover from sourcing interruptions. Academic/practical relevance: Improving supply chains’ recovery ability has been an important focus area for both practitioners and academics. Collectively, available anecdotal evidence and theoretical analyses provide ambiguous recommendations driven by competing effects of different sourcing strategies. Our paper provides the first rigorous and large-scale empirical evidence relating the use of different supply chain strategies to the ability of a supply chain to recover from supply interruptions. Methodology: We develop a compound estimator of a supply chain’s recovery rate that can be constructed using limited available data (only the time series of firms’ actual sourcing behavior). Using more than two and half million import manifests, we extract firms’ maritime sourcing transactions and use this data to estimate recovery rates of different firm-category supply chains of publicly traded U.S. firms. Results: We find that supplier diversification is associated with slower recovery from sourcing interruptions, whereas the use of long-term relationships is associated with faster recovery. A one standard deviation decrease in the former is associated with a 16% faster recovery, and a like increase in the latter is associated with a 20% faster recovery. Managerial implications: Our paper brings important empirical evidence to the hitherto theoretical debate on the impact of sourcing strategies on faster recovery in supply chains. We therefore provide actionable advice on supply chain design for faster recovery.

Long-term Piloting Of Osmotic MBR For Potable Reuse: Performance, Life-Cycle Assessment, and Lessons Learned

2016 ◽  
Vol 2016 (14) ◽  
pp. 830-854
Author(s):  
Tzahi Y Cath ◽  
Ryan W Holloway ◽  
Leslie Miller-Robbie ◽  
Mehul Patel ◽  
Jennifer R Stokes ◽  
...  
Keyword(s):  
Life Cycle Assessment ◽  
Life Cycle ◽  
Lessons Learned ◽  
Potable Reuse

scholarly journals Liquid materials for biomedical research: a highly IT-integrated and automated biobanking solution

2019 ◽  
Vol 43 (6) ◽  
pp. 347-354 ◽  
Author(s):  
Daniela Popp ◽  
Romanus Diekmann ◽  
Lutz Binder ◽  
Abdul R. Asif ◽  
Sara Y. Nussbeck
Keyword(s):  
Life Cycle ◽  
Medical Center ◽  
Research Results ◽  
Long Term Storage ◽  
Medical Centers ◽  
It Systems ◽  
Complete Life Cycle ◽  
The University ◽  
Term Storage

Abstract Various information technology (IT) infrastructures for biobanking, networks of biobanks and biomaterial management are described in the literature. As pre-analytical variables play a major role in the downstream interpretation of clinical as well as research results, their documentation is essential. A description for mainly automated documentation of the complete life-cycle of each biospecimen is lacking so far. Here, the example taken is from the University Medical Center Göttingen (UMG), where the workflow of liquid biomaterials is standardized between the central laboratory and the central biobank. The workflow of liquid biomaterials from sample withdrawal to long-term storage in a biobank was analyzed. Essential data such as time and temperature for processing and freezing can be automatically collected. The proposed solution involves only one major interface between the main IT systems of the laboratory and the biobank. It is key to talk to all the involved stakeholders to ensure a functional and accepted solution. Although IT components differ widely between clinics, the proposed way of documenting the complete life-cycle of each biospecimen can be transferred to other university medical centers. The complete documentation of the life-cycle of each biospecimen ensures a good interpretability of downstream routine as well as research results.

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