Heuristic supply chain modeling method and system

• US 20070150332A1
• Filed: 12/22/2005
• Published: 06/28/2007
• Est. Priority Date: 12/22/2005
• Status: Abandoned Application

• Current Assignee: Caterpillar Incorporated
• Original Assignee: Caterpillar Incorporated
• Inventors: Grichnik, Anthony, Beer, Brian
• Application Number:
  US11/314,247
• Publication Number:
  US 20070150332A1
• Time in Patent Office: Days
• US Class Current: 705/10
• CPC Class Codes: G06Q 10/06 Resources, workflows, human or project management; Enterprise or organisation planning; Enterprise or organisation modelling
• CPC Class Codes: G06Q 10/0631 Resource planning, allocation, distributing or scheduling for enterprises or organisations
• CPC Class Codes: G06Q 10/06375 Prediction of business process outcome or impact based on a proposed change

Abstract

A method is provided for supply chain modeling by a supply chain entity within a supply chain including a plurality of supply chain entities. The method may include obtaining an order fulfillment requirement for a product from a downstream supply chain entity and identifying one or more representative subsystems of the product. The method may also include determining a supply capacity and an inventory requirement for the supply chain entity with respect to the one or more representative subsystems and calculating an inventory cost for the supply chain entity based on the inventory requirement with respect to the one or more representative subsystems.

Claims

1. A method for supply chain modeling by a supply chain entity within a supply chain including a plurality of supply chain entities, comprising:

obtaining an order fulfillment requirement for a product from a downstream supply chain entity;

identifying one or more representative subsystems of the product;

determining a supply capacity and an inventory requirement for the supply chain entity with respect to the one or more representative subsystems; and

calculating an inventory cost for the supply chain entity based on the inventory requirement with respect to the one or more representative subsystems.

2. The method according to claim 1, further including:

determining a supply capacity and an inventory requirement for each of the plurality of supply chain entities corresponding to the one or more representative subsystems;

calculating an inventory cost for the each of the plurality of supply chain entities based on the respective inventory requirement for each of the plurality of supply chain entities corresponding to the one or more representative subsystems; and

deriving a total inventory level for the product by combining the respective inventory cost for the each of the plurality of supply chain entities.

3. The method according to claim 2, further including:

deriving a total inventory cost for the product based on the inventory level.

4. The method according to claim 1, wherein both the supply capacity and the inventory requirement are represented in terms of time.

5. The method according to claim 4, wherein the determining includes:

determining an external information processing and delivery time of the supply chain entity; and

determining a maximum order fulfillment time allowed for the supply chain entity based on the external information processing and delivery time and the order fulfillment requirement for the product.

6. The method according to claim 5, further including:

determining an internal order processing time of the supply chain entity;

determining a factory floor replenishment capacity of the supply chain entity; and

determining an order fulfillment capacity of the supply chain entity based on the internal order processing time and the factory floor replenishment capacity.

7. The method according to claim 6, further including:

determining an inventory capacity requirement of the supply chain entity based on the order fulfillment capacity and the maximum order fulfillment time allowed.

8. The method according to claim 1, wherein the calculating includes:

determining a daily unit cost corresponding to the inventory capacity requirement of the supply chain entity; and

determining an inventory cost based the inventory capacity requirement and the daily unit cost.

9. The method according to claim 1, wherein:

each successive upstream supply chain entity of the supply chain performs a substantially similar calculation on the inventory cost to that performed by a predecessor of the each successive upstream supply chain entity.

10. The method according to claim 9, wherein:

the calculation is selected to minimize a total number of calculations for the supply chain.

11. A computer system provided for supply chain modeling by a supply chain entity within a supply chain, the computer comprising:

a database containing information associated with a plurality of supply chain entities included in the supply chain; and

a processor configured to;

obtain an order fulfillment requirement for a product from a downstream supply chain entity;

identify one or more representative subsystems of the product;

determine a supply capacity and an inventory requirement for the supply chain entity with respect to the one or more representative subsystems; and

calculate an inventory cost for the supply chain entity based on the inventory requirement with respect to the one or more representative subsystems.

12. The computer system according to claim 11, the processor being further configured to:

determine a supply capacity and an inventory requirement for each of the plurality of supply chain entities corresponding to the one or more representative subsystems;

calculate an inventory cost for the each of the plurality of supply chain entities based on the respective inventory requirement for each of the plurality of supply chain entities corresponding to the one or more representative subsystems; and

derive a total inventory cost for the product by combining the respective inventory cost for the each of the plurality of supply chain entities.

13. The computer system according to claim 12, wherein both the supply capacity and the inventory requirement are represented in terms of time.

14. The computer system according to claim 12, wherein, to determine the supply capacity, the processor is further configured to:

determine an external information processing and delivery time of the supply chain entity; and

determine a maximum order fulfillment time allowed for the supply chain entity based on the external information processing and delivery time and the order fulfillment requirement for the product.

15. The computer system according to claim 14, wherein the processor is further configured to:

determine an internal order processing time of the supply chain entity;

determine a factory floor replenishment capacity of the supply chain entity; and

determine an order fulfillment capacity of the supply chain entity based on the internal order processing time and the factory floor replenishment capacity.

16. The computer system according to claim 15, wherein the processor is further configured to:

determine an inventory capacity requirement of the supply chain entity based on the order fulfillment capacity and the maximum order fulfillment time allowed.

17. The computer system according to claim 12, wherein, to calculate the inventory cost, the processor is further configured to:

determine a daily unit cost corresponding to the inventory capacity requirement of the supply chain entity; and

determine an inventory cost based the inventory capacity requirement and the daily unit cost.

18. The computer system according to claim 12, further including:

a display device configured to;

display one or more steps used by the processor to obtain the order fulfillment requirement;

to identify the one or more representative subsystems;

to determine the supply capacity and the inventory requirement; and

to calculate the inventory cost.

19. A computer-readable medium for use on a computer system configured to perform a supply chain modeling procedure for a supply chain entity within a supply chain including a plurality of supply chain entities, the computer-readable medium having computer-executable instructions for performing a method comprising:

obtaining an order fulfillment requirement for a product from a downstream supply chain entity;

identifying one or more representative subsystems of the product;

determining a supply capacity and an inventory requirement for the supply chain entity with respect to the one or more representative subsystems; and

calculating an inventory cost for the supply chain entity based on the inventory requirement with respect to the one or more representative subsystems.

20. The computer-readable medium according to claim 19, wherein the method further includes:

determining a supply capacity and an inventory requirement for each of the plurality of supply chain entities with respect to the one or more representative subsystems;

calculating an inventory cost for the each of the plurality of supply chain entities based on the respective inventory requirement for each of the plurality of supply chain entities with respect to the one or more representative subsystems; and

deriving a total inventory cost for the product by combining the respective inventory cost for the each of the plurality of supply chain entities.

21. The computer-readable medium according to claim 19, wherein both the supply capacity and the inventory requirement are represented in terms of time, and the step of determining includes:

determining an external information processing and delivery time of the supply chain entity; and

determining a maximum order fulfillment time allowed for the supply chain entity based on the external information processing and delivery time and the order fulfillment requirement for the product.

22. The computer-readable medium according to claim 21, wherein the step of determining further includes:

determining an internal order processing time of the supply chain entity;

determining a factory floor replenishment capacity of the supply chain entity; and

determining an order fulfillment capacity of the supply chain entity based on the internal order processing time and the factory floor replenishment capacity.

23. The computer-readable medium according to claim 22, wherein the step of determining further includes:

determining an inventory capacity requirement of the supply chain entity based on the order fulfillment capacity and the maximum order fulfillment time allowed.