Analysing the interaction of supply chain synchronisation and material flow stability

Abstract

Empirical evidence created a commonly accepted understanding that supply chain synchronisation and material flow stability impact supply chain performance. This crucial link between synchronous and stable material flows is at the heart of lean thinking. Therefore it is necessary to reach a finer understanding of these dynamics based on quantitative modelling. The specific contribution of this paper is to investigate the interrelated impact of synchronisation and stability on supply chain performance. To do so, we consider a multi-stage supply chain and analyse different synchronisation/stability scenarios with respect to its potential impacts. Numerical simulations demonstrate that by combining high levels of material flow stability with a synchronous supply chain, it is possible to actually achieve low inventory levels whilst maintaining high customer service. More interestingly, numerical simulation revealed that if stability falls below a certain threshold, supply chain performance gets dramatically worse when synchronisation levels decline. This nonlinear interaction verifies the importance of performing material flow stability in supply chain management.