A multi-objective approach to design strategic supply chains and develop responsiveness- efficiency frontiers

Abstract

Purpose The purpose of this paper is twofold. Initially, a multi-objective binary integer programming model is proposed for designing an appropriate supply chain that takes into consideration both responsiveness and efficiency. Then, a responsiveness-cost efficient frontier is generated for the supply chain design that can help organizations find the right balance between responsiveness and efficiency, and hence achieve a strategic fit between organizational strategy and supply chain capabilities. Design/methodology/approach The proposed SC design model used both cross-functional and logistical SC drivers to build a binary integer programming model. To this end, various alternative solutions that correspond to different SC design portfolios were generated and a responsiveness-cost efficient frontier was constructed. Findings Various alternative solutions that correspond to different SC designs were generated and a responsiveness-cost efficient frontier was constructed to help the decision makers to design SC portfolios to achieve a strategic fit between organizational strategy and SC capabilities. Practical implications The proposed methodology enables the decision makers to incorporate both qualitative and quantitative judgements in SC design. The methodology is easy to use and it can be readily implemented by a software. Originality/value The proposed methodology allows for subjective value judgements of the decision makers to be considered in SC design and the efficiency-responsiveness frontier generated by the methodology provides a trade-off to be used when choosing between speed and cost efficiency in SC design.