Coordinating supply chain response-time: a bi-level programming approach

Agile response ability has become an essential competitive factor for firms in supply chain to survive in a rapidly changed market environment characterized by globalization and customization, especially for those distributing in the China Pearl river delta regions. Shortening and optimizing response time is an effective approach to reduce response-time of product launch. Treating the response-time in supply chain as an allocable resource, this paper presents an effective approach of coordinating the supply chain plan by allocating response-time among the node firms and assigning production time and logistics time rationally to each node firm. Given the core firm as a coordinating center, we construct a coordinated planning mechanism based on supply chain’s global benefit and node firm’s local benefit, and develop a bi-level programming approach to model supply chain response time. Finally, the model is tested and verified by analyzing a practical case which demonstrated that it is an effective decision-making aided tool for coordinating supply chain response-time.