Most of the products we use in our daily lives are brought to the markets by supply chains. Companies that want to have competitive edge realize the importance of concentrating on core competencies and outsourcing the rest of the activities from others. In addition to focusing on core competencies, the search for low labor costs has led to vertical disintegration of multinational companies. Therefore, customers and end users of products are dependent on a large number of often distant and hard to control manufacturers and service providers.
In this research lab, we contribute to the scientific literature by developing algorithms for optimizing the supply chain decisions of multi-echelon systems subject to demand and supply uncertainties. These algorithms are applied by many multi-national companies and they bring significant cost benefits.
One particular system type that has been extensively studied by the Supply Chain Management Lab is the configure-to-order system. The end products of configure-to-order systems are in most cases unique and fulfill the exact needs of the customer. Examples include advanced medical systems, electronic microscopes and lithography systems. These products are created through the careful combination of different hardware modules and software.
The supply chain of a configure-to-order business distinguishes between two main phases. The first part of the supply chain concerns the modules. These must be ordered in advance in order to prevent excessive total customer lead time. Therefore, the first part of the supply chain is driven by forecast. The latter part of the supply chain is driven by the customer order. In our lab, we focus on the optimal design and operational coordination of these two phases of the configure-to-order systems.
The Supply Chain Management lab focusses primarily on the development of concepts that support the control and coordination of supply chains with emphasis on finding valid, quantitative models. Because companies are often our laboratory, we do not solely strive for contributions to the academic field of operations research. The research conducted at our lab leads to practical insights, and the implementation of our models is just as important. We model important issues faced by different companies within this industry and use quantitative methods in order to develop decision support tools that can be used by different companies by different business functions.
The Supply Chain Management Lab has had great impact on global industry. We collaborate closely with companies like Océ, Philips Medical Systems, FEI and ASML. At these companies, master thesis projects are conducted, where the research of our lab is implemented into practice. For example, we helped the former Philips Semiconductors to increase their gross profit with 15 million euros per year, during a five year period. This amount was substantial considering their yearly turnover of 200 million euros. To a large extent the increase in profit was due to increasing the turnover, implying that even more value was created for the supply chain as a whole.
More recently, in cooperation with ASML, we developed a planning tool called SPOT (Scenario Planning and Optimization Tool), which enables ASML to balance the expected demand and supply chain possibilities of lithography systems. The tool makes it possible to determine (1) what the output will be given the current state of materials and capacities in the supply chain, and (2) what additional materials have to be released to bring the future output in balance with expected demand, given the available capacity. The tool is thus able to optimize the planning from a supply point of view. Moreover, the tool can be used to create in a controlled way mix flexibility regarding the variants and options of the systems.
Our lab is involved in a number of (in-company) graduation projects of Bachelor and Master students. Some interesting, recently performed projects are:
Currently our lab is involved in the following (joint) research & development projects. These projects are usually conducted in collaboration with other universities and companies. Contact our us if you are interested in teaming up for a new project proposal.