Summaries - Research
Back Cost and Operational Evaluations of Centralized vs. Distributed Class IX Inventories
|Division||Research & Sponsored Programs|
|Department||NPS Naval Research Program|
Atkinson, Michael P.
|Sponsor||NPS Naval Research Program (Navy)|
The Marine Corps manages the second echelon of repair parts in a distributed manner, manifested in individually managed Supply Management Units (SMUs). An alternative is a centralized approach where requests for parts are satisfied from a single central logistic entity; either a single centralized depot or a single centralized management entity that controls spatially distributed physical facilities. While a distributed inventory system would enhance logistical responsiveness, a centralized one can substantially reduce overall cost and enhance logistical flexibility through supply-chain “risk pooling”. If transshipments among SMUs are prevalent, then the relative benefit of risk-pooling diminishes and the potential benefit is in substantially reducing overhead costs and streamlining management. Our analysis will compare three options: (1) the current system of SMUs, (2) spatially distributed facilities with centralized management, (3) a fully centralized inventory system. The comparison will focus on two main measures: logistical responsiveness and cost.
Are SMUs fully interchangeable in terms of directing demands from forward deployed units?
Are backorder figures SMU-dependent?
How does logistical responsiveness vary among the three possible systems described above?
What would be the expected cost difference between the three possible systems?
Research Methodology: Perform data analysis to study how demands, backorders, and dispositions vary. Develop a stochastic network model that represents the possible supply nodes and edges within the SMUs and edges between the supply nodes and the demand nodes at the forward deployed units. The centralized system will be represented by a tree rooted at the central depot. In the distributed case the existence of edges will reflect the possible flow of repair parts.
Deliverables: Student thesis, final report, code and algorithms.
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