From waste to value – a system dynamics model for strategic decision-making in closed-loop supply chains

Recent years have witnessed companies abandon traditional open-loop supply chain structures in favour of closed-loop variants, in a bid to mitigate environmental impacts and exploit economic opportunities. Central to the closed-loop paradigm is remanufacturing: the restoration of used products to useful life. While this operational model has huge potential to extend product life-cycles, the collection and recovery processes diminish the effectiveness of existing control mechanisms for open-loop systems. We systematically review the literature in the field of closed-loop supply chain dynamics, which explores the time-varying interactions of material and information flows in the different elements of remanufacturing supply chains. We supplement this with further reviews of what we call the three 'pillars' of such systems, i.e. forecasting, collection, and inventory and production control. This provides us with an interdisciplinary lens to investigate how a 'boomerang' effect (i.e. sale, consumption, and return processes) impacts on the behaviour of the closed-loop system and to understand how it can be controlled. To facilitate this, we contrast closed-loop supply chain dynamics research to the welldeveloped research in each pillar; explore how different disciplines have accommodated the supply, process, demand, and control uncertainties; and provide insights for future research on the dynamics of remanufacturing systems.

Section: Locating and Selecting The Relevant Studiesmentioning

confidence: 99%

Section: Locating and Selecting The Relevant Studiesmentioning

confidence: 99%

The boomerang returns? Accounting for the impact of uncertainties on the dynamics of remanufacturing systems

Goltsos

Ponte

Wang

et al. 2018

“…Surana et al 2005;Pathak et al 2007;Tako and Robinson 2012;Hearnshaw and Wilson 2013;Lehr, Thun, and Milling 2013). By inspiration of fractal philosophy, some scholars introduce the fractal idea into their studies.…”

Section: Related Workmentioning

confidence: 99%

A fractal perspective-based methodological framework for supply chain modelling and distributed simulation with multi-agent system

Dai

Lin

Long

2014

With the development of global economy, supply chain, as a recognised complex system, is becoming more complex for analysis. In this context, it is worth introducing the perspective of complex system in perceiving and modelling of supply chain system to address its dynamic, stochastic and uncertain characteristics. Therefore, this paper proposes a methodological framework of supply chain modelling and simulation based on the fractal perspective, and presents an all-round and systematic exposition of concept modelling and distributed simulation by means of multi-agent technology. In this framework, different supply chain scenarios focusing on manufacturing, inventory and transportation can be easily modelled and simulated at different scales and levels. In addition, a prototype system which implements the methodological framework and the key implementation techniques are presented as well. Finally, a supply chain example, which supposes manufacturer as the core member, is modelled and simulated with the prototype system to illustrate the effectiveness of the proposed framework.

“…A complex model including product life-cycles is in the focus of Georgiadis, Vlachos, and Tagaras (2006) the effects of a product lifecycle and different product return patterns on the optimal collection and remanufacturing strategies over time is explored. Further approaches concern modelling of demand-side interactions of an OEM to test various reprocessing strategies (Lehr, Thun, and Milling 2013) or the exploration of impacts regarding the length of usage-phases and return frequencies of used products on reprocessing strategies (Poles and Cheong 2009). A complex model which integrates several aspects of a view on the total life-cycle of a product is presented in Subramanian, Talbot, and Gupta (2010).…”

Section: Related Literaturementioning

confidence: 99%

Integrated decision-making in reverse logistics: an optimisation of interacting acquisition, grading and disposition processes

Lechner

Reimann

2019

In view of global environmental and social challenges the transition towards a Circular Economy is considered as a crucial factor for sustainable development. Therefore, the replacement of traditional linear business models involving product discard at the end of product life with concepts focusing on re-use of resources is essential. Reverse Logistics and Closed-loop Supply Chains are seen to be key elements of such a transition. Motivated by findings from a case study of an independent reprocessing company, we address integrated decision-making in Reverse Logistics in this paper. We present a non-linear optimisation model with interrelated processes in terms of acquisition of used products, grading for determination of product quality and reprocessing disposition. The decisions to be made concern the effort spent for active acquisition of used products and the number of reprocessed goods; both decisions are influenced by heterogeneous condition of used products. The consideration of deterministic and stochastic demand facilitates the representation of a variety of business cases. For both demand types we provide analytical insights in the form of complete strategies consisting of different scenarios which allow optimal decision-making under variable conditions. Numerical examples complement insights into the model by conducting a sensitivity analysis of relevant model parameters.