Table Of ContentSUPPLY CHAIN ANALYSIS
A Handbook on the Interaction
of Information, System and
Optimization
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SUPPLY CHAIN ANALYSIS
A Handbook on the Interaction
of Information, System and Optimization
Edited by
Christopher S. Tang
UCLA Anderson School of Management
Chung-Piaw Teo
NUS Business School, National University of Singapore
Kwok-Kee Wei
Faculty of Business, City University of Hong Kong
Christopher S. Tang Chung-Piaw Teo
University of California at Los Angeles National University of Singapore
California, USA Singapore
Kwok-Kee Wei
City University of Hong Kong
Hong Kong
Series Editor:
Fred Hillier
Stanford University
Stanford, CA, USA
Library of Congress Control Number: 2007935247
ISBN-13: 978-0-387-75239-6 e-ISBN-13: 978-0-387-75240-2
Printed on acid-free paper.
© 2008 by Springer Science+Business Media, LLC
All rights reserved. This work may not be translated or copied in whole or in part without the written
permission of the publisher (Springer Science+Business Media, LLC, 233 Spring Street, New York, NY
10013, USA), except for brief excerpts in connection with reviews or scholarly analysis. Use in
connection with any form of information storage and retrieval, electronic adaptation, computer software,
or by similar or dissimilar methodology now know or hereafter developed is forbidden.
The use in this publication of trade names, trademarks, service marks and similar terms, even if they are
not identified as such, is not to be taken as an expression of opinion as to whether or not they are subject
to proprietary rights.
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Contents
Preface vii
Supply Chain Configurations of Foreign Cosmetics Companies
Operating in China 1
Cindy Fang, Frances Gao, David Liu, Christopher S. Tang, Weiwei Wang,
and Tony Wu
Structural Supply Chain Collaboration Among Grocery Manufacturers 29
Timothy M. Laseter and Elliott N. Weiss
Supply Chain Management in the Chemical Industry: Trends, Issues,
and Research Interests 45
Hong Choon Oh, I.A. Karimi, and R. Srinivasan
Berth Allocation Planning Optimization in Container Terminals 69
Jam Dai, Wuqin Lin, Rajeeva Moorthy, and Chung-Piaw Teo
Merchandise Planning Models for Fashion Retailing 105
Kumar Rajaram
Supply Chain Management in the Presence of Secondary Market 147
Hau L. Lee, Barchi Peleg, Seungjin Whang, and Yan Zou
Global Diffusion of ISO 9000 Certification Through Supply Chains 169
Charles J. Corbett
Risk Management in Global Supply Chain Networks 201
N. Viswanadham and Roshan S. Gaonkar
Trust and Power Influences in Supply Chain Collaboration 223
Weiling Ke and Kwok-Kee Wei
vi Contents
Foreign Direct Investment or Outsourcing: A Tax Integrated Supply Chain
Decision Model 241
N. Viswanadham and Kannan Balaji
Integrating Demand and Supply Chains 261
Puay Guan Goh
Mumbai Tiffin (Dabba) Express 271
Natarajan Balakrishnan and Chung-Piaw Teo
Index 279
Preface
Supply chain academic research has traditionally focused on the interaction
of information and processes, with goals of streamlining the various acti-
vities within the supply chain to obtain the optimal or desired outcomes.
Most of the insights, however, were obtained under the ideal situation where
the settings are the most general. Practitioners, on the other hand, have
focused on developing cost effective solution strategies on the ground, to
adapt to local and industry specific conditions.
The chapters in this handbook are compiled with the intent to bridge this
gap.
In the first chapter (Supply Chain Configurations of Foreign Cosmetics
Companies Operating in China), Fang et al. examined the issues of supply
chain design, from the perspective of foreign cosmetic companies operating
in China. They examined the market potential of this industry, and propose
three major supply chain configurations in this industry (Direct or Indirect
Export of Finished Goods, Outsourced Manufacturing, or Offshore Manu-
facturing). They further examine the various supply chain issues associated
with each configuration. The chapter blends extensive industry surveys with
a comprehensive framework and extensive list of issues to spur future
research in this area.
In the second chapter (Structural Supply Chain Collaboration Among
Grocery Manufacturers), Laseter and Weiss continued this theme, and
examined the issue of supply chain coordination among the grocery manu-
facturers. Most notably, they quantify the opportunity for strategic, multi-
lateral collaboration through a shared distribution network. This moved one
step beyond the current focus on CPFR and VMI, which are essentially
collaborative efforts focusing on inventory turns and service performance.
Oh, Karimi and Srinivasan (Supply Chain Management in Chemical
Industry) looked at the supply chain issues in the chemical industry. The
chapter identified several unique characteristics, emerging trends, and
operational issues of the industry and proposed new research agenda.
Dai et al. (Berth Allocation Planning Optimization in Container Terminal)
examined the issue of supply chain efficiency in the container terminal
environment. In this chapter, they focused on the issue of berth planning, a
key step in the port operating environment. They propose a class of policies
viii Preface
to optimize the use of berthing space, to minimize lateness and delays to
vessels, and to achieve the optimal usage of space in the terminal. The model
is tested and validated using data from a real container terminal.
In the fifth chapter (Merchandise Planning Models for Fashion Retailing),
K. Rajaram developed strategies to improve the accuracies of merchandise
testing in fashion retailing. For instance, he found that some of the variations
of the sales of a product mix can be explained by store descriptors, and used
this observation to develop a new merchandising process. He tested the ideas
on a large women’s apparel retailer, and a catalog retailer, and reported
significant savings using the proposed models.
In the sixth chapter (Supply Chain Management in the Presence of
Secondary Market), Lee et al. examined the impacts of online secondary
market on the operational issues of a supply chain. This problem has become
more prevalent, with the proliferation of E-marketplaces. They characterized
the optimal responses under various scenarios (e.g. when manufacturers
intervened in the secondary market), and identified the key roles played by
the secondary markets in the supply chain.
C. Corbett (Global Diffusion of ISO 9000 Certification Through Supply
Chains) looked at the contribution of globalized supply chain to the diffusion
of ISO 9000 certification, using data from a global survey. He concluded
that the diffusion of ISO 9000 started primarily in Europe, and spread to
other countries as the European firms pressured their suppliers to seek ISO
9000 certification. This chapter highlighted the role of supply chain on the
diffusion of management practices in the industry.
Viswanadham and Gaonkar (Risk Management in Global Supply Chain
Networks) looked at a timely issue – the impact of risk and disruption in
supply chain. They developed a framework and classification to handle
supply chain risk management issues. They developed mathematical models,
built on mapping of exceptions and consequences using fault trees and event
trees, to design robust inbound supply chains that are resilient to deviations
and disruptions.
W. Ke and K.K. Wei (Trust and Power Influences in Supply Chain Col-
laboration) looked at the issue of information sharing from a socio-political
perspective. They distinguished between two types of trust – competence
and benevolence, and five types of non-coercive power, and studied their
impact on firm’s predisposition to sharing information and know-hows.
They identified competence-based trust as more important for know-how
sharing.
Viswanadham and Balaji (Foreign Direct Investment or Outsourcing:
A Tax Integrated Supply Chain Decision Model) examined the impact of
taxes on supply chain planning. More specifically, they analyzed the model
by incorporating tax-holidays enjoyed by locating the various stages of the
Preface ix
supply chain in FTZs. This has become an important concern for supply
chain planning, as FTZ is a strategy being used by many developing
countries to attract FDI.
The penultimate chapter in this handbook is a contribution by P.G. Goh
(Integrating Demand and Supply Chains). He expounded on the needs to
synchronize supply with demand chain, and explained the difficulties in
doing so with case studies from firms based in Asia.
In the last chapter, Balakrishnan and Teo (Mumbai Tiffin (Dabba)
Express) looked at a marvelous distribution system based in India – a system
perfected by a group of illiterate workers, without the aid of modern
technology and expert advice. The system relies solely on a primitive coding
system, and the reliable railway system in Mumbai.
Supply Chain Configurations of Foreign Cosmetics
Companies Operating in China
Cindy Fang, Frances Gao, David Liu, Christopher S. Tang, Weiwei Wang,
and Tony Wu
UCLA Anderson School, 110 Westwood Plaza, Los Angeles, CA 90095, USA
Abstract: As foreign cosmetics companies develop strategies for establishing or
expanding their presence in China, they need to configure their supply
network, distribution channels, and outbound distribution network so as to
improve coordination and maximize efficiency. In this paper, we investigate
the current supply chain configurations of various foreign cosmetics
companies operating in China. In addition, we highlight new research
opportunities for supply chain designs.
Key words: Supply Chain Configurations, Distribution Channels, Outbound Distribution,
Market Entry Strategies, Alignment, China.
