Including sustainability criteria into inventory models

Abstract

Research on sustainability performance has considerably enriched operations management literature in recent years. However, work with quantitative models is still scarce. This paper thus contributes to revisit classical inventory models by taking sustainability concerns into account. We believe that reducing all aspects of sustainable development to a single objective is not desirable. We thus reformulate the classical economic order quantity model as a multiobjective problem. We propose to refer to this model as the sustainable order quantity model. Then, a multi-echelon extension of the sustainable order quantity model is studied. For both models, the set of efficient solutions (Pareto optimal solutions) is analytically characterized. These results are used to provide some insights about the effectiveness of different regulatory policies to control carbon emissions. We also propose an interactive procedure that allows the decision maker to quickly identify his / her best option among these solutions. The proposed interactive procedure is a new combination of multi-criteria decision analysis techniques.

A century of evolution from Harris׳s basic lot size model: Survey and research agenda

“…Recently Bouchery et al (2012) have proposed a model that reformulates the classical economic order quantity problem into a multi-objective problem. Economic, environmental and social impacts are there considered, using the traditional formulas proposed by Harris's original work.…”

Sustainable EOQ under Lead-Time Uncertainty and Multi-Modal Transport

“…However, they ignore the selection of transportation mode in the two-level international supply chain. Bouchery et al [10] reformulate the conventional EOQ model as a multi-objective problem because of the difficulty of developing a single objective problem that considers all aspects of sustainable issues. Moon et al [11] present a bi-objective mixed-integer linear programming model in a multi-period planning horizon with inaccurate information on raw material resources under a carbon emission constraint.…”

Multi-criteria decision making approaches for green supply chains: a review

“…Only ten publications include inventory management decisions while considering economic and environmental criteria. Bouchery et al (2012) present the Sustainable Order Quantity, which is a multi-objective formulation of an Economic Order Quantity (EOQ) model, including economic, environmental and social objectives. An extension to multiple echelons is proposed, and the ecoefficient frontiers are characterised analytically.…”

“…Among publications assigned to MODM approaches, we included Bouchery et al (2012) which studies the SOQ model and analyses the efficient frontier analytically. The authors also develop an interactive procedure to find a balance between the considered objectives.…”