Applications of Neural Networks in Supply Chain Management

Abstract

This chapter focuses on significant applications of self-organizing maps (SOMs), that is, unsupervised learning neural networks in two supply chain applications: cellular manufacturing and real-time management of a delayed delivery vehicle. Both problems require drastic complexity reduction, which is addressed effectively by clustering using SOMs. In the first problem, we cluster machines into cells and we use Latent Semantic Indexing for effective training of the network. In the second problem, we group the distribution sites into clusters based on their geographical location. The available vehicle time is distributed to each cluster by solving an appropriate non-linear optimization problem. Within each cluster an established orienteering heuristic is used to determine the clients to be served and the vehicle route. Extensive experimental results indicate that in terms of solution quality, our approach in general outperforms previously proposed methods. Furthermore, the proposed techniques are more efficient, especially in cases involving large numbers of data points. Neural networks have and will continue to play a significant role in solving effectively complex problems in supply chain applications, some of which are also highlighted in this chapter.