A Multi-Parameter Model for Effective Configuration of Supply Chains

Abstract

In this paper, a mathematical model for the strategic planning and design of supply chains in the globalization context is proposed. A multi-objective function is used to address decisions about capacity sizing, sourcing, and facility location, with the scope of maximizing supply chain profits. The model is dynamic and is applied to a multi-echelon, multi-facility and multi-product supply chain in hypotheses of delocalization. The model is characterized by the specific attention given to cost, revenue and financial factor modelling, which has been obtained by means of an activity-based approach and the inclusion of two drivers that are usually neglected in the literature: energy and labour. The model's applicability and flexibility have been proved via a scenario analysis in which 12 different scenarios were implemented to reproduce the behaviour of major industries.