Supply Chain Network Design: Applying Optimization and Analytics to the Global Supply Chain

Product Author Bios

MICHAEL WATSON (Evanston, IL), a recognized leader in supply chain network modeling, was an officer at LogicTools (now an IBM company). He has taught at Northwestern since 1999.

SARA LEWIS (Chicago, IL), IBM World Wide ILOG Supply Chain Technical Professional Leader, has led many supply chain network modeling projects.

PETE CACIOPPI (Eugene, OR) is a IBM lead scientist for the ILOG Supply Chain Applications.

JAY JAYARAMAN (Hoffman Estates, IL), Manager of North American Consulting Team at IBM for Supply Chain Optimization, oversees IBM's supply chain network modelers.

Using strategic supply chain network design, companies can achieve dramatic savings from their supply chains. Now, experts at IBM and Northwestern University have brought together both the rigorous principles and the practical applications you need to master. You’ll learn how to use supply chain network design to select the right number, location, territory, and size of warehouses, plants, and production lines; and optimize the flow of all products through your supply chain even if extends around the globe. The authors present better ways to decide what to manufacture internally, where to make these products, which products to outsource, and which suppliers to use. They guide you in more effectively managing tradeoffs such as cost vs. service level, improving operational decision-making by integrating analytics throughout supply chain management; and re-optimizing regularly for even greater savings. Supply Chain Network Design combines best practices, the latest methods in optimization and analytics, and cutting-edge case studies: everything you need to maximize the value of supply chain network design. For all supply chain executives, managers, strategists, and analysts; and for all students, instructors, and researchers in advanced supply chain management and/or logistics courses.

Table of Contents

Preface     xvi

Part I: Introduction and Basic Building Blocks

Chapter 1: THE VALUE OF SUPPLY CHAIN NETWORK DESIGN     1

Chapter 2: INTUITION BUILDING WITH CENTER OF GRAVITY MODELS     23

Chapter 3: LOCATING FACILITIES USING A DISTANCE-BASED APPROACH     37

Chapter 4: ALTERNATIVE SERVICE LEVELS AND SENSITIVITY ANALYSIS     63

Chapter 5: ADDING CAPACITY TO THE MODEL     83

Part II: Adding Costs to Two-Echelon Supply Chains

Chapter 6: ADDING OUTBOUND TRANSPORTATION TO THE MODEL     99

Chapter 7: INTRODUCING FACILITY FIXED AND VARIABLE COSTS     127

Chapter 8: BASELINES AND OPTIMAL BASELINES     139

Part III: Advanced Modeling and Expanding to Multiple Echelons

Chapter 9: THREE-ECHELON SUPPLY CHAIN MODELING     157

Chapter 10: ADDING MULTIPLE PRODUCTS AND MULTISITE PRODUCTION SOURCING     177

Chapter 11: MULTI-OBJECTIVE OPTIMIZATION     207

Part IV: How to Get Industrial-Strength Results

Chapter 12: THE ART OF MODELING     217

Chapter 13: DATA AGGREGATION IN NETWORK DESIGN     237

Chapter 14: CREATING A GROUP AND RUNNING A PROJECT     261

Part V: Case Study Wrap Up

Chapter 15: CASE STUDY: JPMS CHEMICALS CASE STUDY     277

Index     295