Using Simulation Modeling and Analysis to Assess the Effect of Variability and Flexibility on Supply Chain Lead Time

Abstract

In today’s highly competitive marketplace, enterprises are in constant need to improve and sustain their existence. Two key supply-chain performance measures are lead time and variability in lead time, both of which affect sustainability of manufacturing and logistics systems. One way that has been proposed to improve both measures is to increase supplier flexibility. Our research focuses on defining the effects of various manufacturing and logistics flexibility-related factors on lead time and its variability. We use simulation modeling and analysis as the basis for studying the impact of both design and system factors on performance. In this chapter, we present our findings on the effect on lead time of supplier flexibility level, proportion of process time that is production and transportation time, and level of variability in process time. We also discuss briefly our flexibility-factor framework and conceptual model for the simulation, as well as its implementation in FlexSim simulation software.