Today I would like to talk about a non-essential, but helpful part of supply chain management: Simulation.
Simulation can be used in a supply chain setting on many different levels. On a strategic level there are models to analyze scenarios for the optimal locations of one’s factory, on a tactical level inventory management and distribution policies are treated and on the operations side route-optimization is a generally used. Of course there are also non-simulation models for these tasks, but this article is not about the pros and cons of that.
Stress tests are an acknowledged method to test systems under extreme conditions. The method is not only used in engineering (eg. Great picture of a Boing wing stress test (Guardian Eyewitness)), but also in business, most notably and in the banking industry. But can this method also be used to test supply chain designs?
