Decision Support Systems
for Supply Chain
Management
Chap 10
王仁宏 助理教授
國立中正大學企業管理學系
©Copyright 2001 製商整合科技中心
Decision Support Systems
• Some decisions are better made by
people: flexibility, intuition, wisdom
• Some decisions are better made by
computers
• DSS allow computers and people to work
together to make better decisions, range
from spreadsheets to expert systems.
• Advanced Planning and Scheduling (APS)
Areas of DSS
• Demand planning
• Supply planning: distribution resource
planning system (DRP)
• Manufacturing planning and scheduling
Mathematical Tools of DSS
• Operations research: developed in World
War II
• Artificial intelligence (AI): intelligent agents
• Expert systems: a kind of AI, rely on an
extensive database of knowledge
DSS Components
• Input data
– Becoming easier to obtain
– Quality important - validation
• Analytical tools
– Simulation, AI, optimization, data mining
– Heuristics vs. Optimal solutions, bounds
• Presentation tools
– GIS, graphical displays
Analytical Tools
•
•
•
•
•
•
•
•
Queries
Statistical analysis
Data mining
Online analytical processing (OLAP) tools
Calculators
Simulation
Artificial intelligence
Mathematical models and algorithms
Choose Appropriate Analytical
Tools
•
•
•
•
The type of problem being considered
Required accuracy of the solution
Problem Complexity
Number and type of quantifiable output
measures
• Required speed of DSS
• Number of objectives or goals of the
decision maker
Applications and Analytical
Tools
• Marketing: Query, statistics, data mining
• Routing: Heuristics, exact algorithm
• Production scheduling: simulation,
heuristics dispatch rules
• Logistics network configuration: simulation,
heuristics, exact algorithms
• Mode selection: heuristics, exact
algorithm
Presentation Tools
•
•
•
•
•
•
Reports
Charts
Spreadsheet tables
Animation
Specialized graphic formats: layout
Geographic Information System (GIS)
GIS Capabilities
•
•
•
•
•
•
•
•
•
Mapping and thematic mapping
Database management
Interactive data query
Spatial data retrieval
Geographic data manipulation
Spatial data analysis
Geocoding: translate addresses into geographic coordinates
Geographic data import/export
Buffering/polygon overlay
GIS Application Areas
•
•
•
•
•
•
•
•
•
Marketing analysis
Census and demographic data analysis
Real estate
Geology
Forestry
Network analysis
Site selection
Routing
Supply chain management
DSS Evaluation
• P. 272
Logistics Network Design
DSS Examples
• Logistics Network Design
• Supply Chain Planning
• Vehicle Routing and Scheduling
Logistics Network Design
• Data:
– A listing of all products
– Location of customers, existing warehouses and
sources
– Demand for each product by customer location
– Transportation rates
– Variable production costs
– Warehousing costs
– Shipment sizes by product
Logistics Network Design
• Data (Contd.):
– Order patterns by frequency, size, season,
product
– Order processing costs
– Customer service objectives
Logistics Network Design
Logistics Network Design
• The Key Issues:
– Number of warehouses
– Location of each warehouse
– Size of each warehouse
– Allocation of products to the different
warehouses
– Allocation of customers to each warehouse
Logistics Network Design
• The Objective is to balance service level
against
– production/ purchasing costs,
– inventory carrying costs,
– facility costs
• storage,
• handling,
• fixed,
– transportation costs.
Logistics Network Design
Supply Chain Planning
• Data:
– Information regarding suppliers,
manufacturers, warehouses and retail stores.
– Forecast demands for each store.
– Available transportation modes, transportation
costs and inventory costs.
Supply Chain Planning
• Demand planning
• Production planning and detailed
scheduling
• Distribution planning
Supply Chain Planning
• Constraints:
–
–
–
–
–
Each store receives its demand.
Warehouse Capacity.
Supplier/ Manufacturer limitations.
Delivery Time.
Service Level.
• Goal:
– Design production and distribution schedules so
that no constraint is violated and total cost
including manufacturing, inventory and
transportation is as small as possible.
Vehicle Routing
• Data:
– A set of vehicles,
– demand locations (or customers) where
demand is picked up,
– depots.
Vehicle Routing
Vehicle Routing
• Constraints:
– Each demand location is visited and the
demand is picked
– Vehicle Capacity.
– Distance Constraint.
– Time Window Constraints:
• Earliest Pick-up time,
• Service time,
• Latest pick-up time.
Vehicle Routing
• Goal:
– Design routes for vehicles such that no
constraint is violated and either
• total length of routes is as small as possible, or
• number of vehicles is minimized.
Vehicle Routing
Vehicle Routing
DSS: Past Approaches and
Limitations
• Many procedures have been developed.
– A common limitation of these procedures is
the lack of robustness
• Lack of inexpensive graphical
representation tools for geographic data.
• Inability to solve large scale problems on
desk-top computers.
New Developments
• Deeper understanding of
– the underlying structure of effective strategies for
large scale models,
– uncertainty issues.
• Development of new procedures that are
–
–
–
–
robust
efficient
practical
fast.
New Developments
• Significant increase in computing power.
• Development of desk-top Decision
Support tools such as Geographic
Information Systems (GIS).
Geographic Information
Systems (GIS)
• Definition: A GIS is an integrated computer
mapping and database management
system that provides functions for the
storage, retrieval, management, analysis
and display of geographic data.
Typical GIS Capabilities
•
•
•
•
•
Mapping
Database management
Geographic Data Retrieval
Geographic Data Manipulation
Geographic Data Analysis
Typical GIS Interface
Typical GIS Applications
•
•
•
•
Census and Demographic Data Analysis
Market Analysis
Land Use/ Parcel Mapping
Network Analysis
– Transportation,
– Telecommunications
• Site Location Modeling
• Distribution, Logistics and Supply-Chain
Management.
Benefits of Integrating
GIS with Optimization
• Development of Model Input
• Visualization of Data
• Provides Accurate Street Level Data Base
– One Way Streets
– Turn Difficulties
• Visualization of Strategies Generated by
the Procedure
Benefits of Integrating
GIS with Optimization
• Incorporate Travel Time Estimation
• Model Evaluation
• Interactive Decision Support System.
Table 1:Software
Vendors/Logistics
Topic
CAPS Logistics
Insight
Intertrans
LogicTools
Established
1979
1978
1991
1995
Home page
www.caps.com
www.insightmss.com
www.itls.com
www.logictool.com
Products
Supply Chain
Designer,
Supply Chain
Coordinator,
Transpro,
Routepro
SAILS
GSCM
SHIPCONS II
BDS
Supply Chain Strategist
Global Logistics Manager
Carrier bid optimizer
Transportation Modeler
Transportation Optimizer
Transportation Manager
LogicNet
LogicChain
Platform
MS Windows
MS Windows
Client/server
MS Windows
A Step Back: Information
Technology
• Internal and external systems connecting
the parts of the firm to each other,
customers and suppliers
• Companies employ various systems:
– Decision support systems
– Warehouse management systems
– Production planning and tracking
– Transaction and sales processing
– Communications systems: Email, Intranets
Memo