Simulating Processes: An Application in Supply Chain Management

Abstract

Many systems can be built in a way that corresponds to changes in its surroundings. We create a system that responds to the environment by employing a supply chain management approach. We look at a production problem where the manufacturer needs to place sensors in order to supervise its production line. We assume that production can get ‘out of control’ as a result of certain changes in the environment. However, we aim in creating an effective way to track those instances and act accordingly. We use techniques from Operations Research and Operations Management to better control the sensors and handle the supply chain. This suggested approach is dynamic and follows different steps along the chain – starting with research and development, intermediate production, final products and sales to consumers. We show that the rate of detection we obtain is superior to other static techniques. This work has implications for the design systems that work in a complex environment and in which the environment produces unpredictable changes and there is a need to correspond with them.