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1 2009

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Channels focused production and allocation planning for a steel supply chain - a fuzzy goal programming with priority approach

Tsai M., Chen Y. J., You S. Y.

Foundations of Computing and Decision Sciences

2009

Vol. 34, No. 2

125-152

This paper presents a fuzzy multi-objective decision model for a vertically integrated steel supply chain to produce and allocate scarce steel products among a set of alternative distribution channels based on their past performances. The objectives include net profits, inventory costs, backorder amounts, rate of end user claims and late lading amounts. Uncertainty in market demand and capacity is considered in the model to reflect the current steel industry environment. Using the concepts of additive criterion and preemptive priority, the proposed model generates a robust and preferred tactical plan by specifying desired satisfaction levels, demand fulfilment rates and capacity utilization according to the operations and channels management policy. We validated the model with the operational data and parameters of a major Taiwan based integrated steel manufacturer. The results show that the model can effectively handle channel focused production and allocation planning problems under uncertain industry environments.