Supply chain network design – a model and its applications

Great effort has been exerted to redesign the supply chain network as a means to improve corporate competitiveness. In this study, we present a mathematical model and a solution system to help redesign corporate logistics networks. The objective of the model is to minimize total logistics costs. We applied the solution system to real problem cases. We use the model and the concept to develop decision support system that is based on C++ with the use of CPLEX callable library as a solution engine. We tested and verified the DSS for redesigning the network of a large Korean electronics company. Through various scenario analyses, we recommend to redesign their supply chain network that demonstrates the possibility of substantial logistics cost savings.