Transshipments: An emerging inventory recourse to achieve supply chain leagility

Transshipments: An emerging inventory recourse to achieve supply chain leagility

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Article ID: iaor20032621
Country: Netherlands
Volume: 80
Issue: 3
Start Page Number: 201
End Page Number: 212
Publication Date: Jan 2002
Journal: International Journal of Production Economics
Authors: , ,
Keywords: transshipment, supply chain
Abstract:

Supply chain designs are constrained by the cost-service trade-off. Cost minimization typically leads to physically efficient or lean supply chains at the expense of customer responsiveness or agility. Recently, the concept of leagility has been introduced. Research on leagility, defined as the capability of concurrently deploying the lean and agile paradigms, hinges heavily on the identification of the decoupling point, which, in turn, is enabled by postponement. Postponement strategies, however, present a cross-functional challenge for implementation. As a tactical solution to achieve leagility without postponement, we introduce transshipments, which represent a common practice in multi-location inventory systems involving monitored movement of stock between locations at the same echelon level of the supply chain. Through a series of models, we establish how transshipments can be used to enhance both agility and leanness.

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