UC Berkeley

This dissertation contributes to the supply chain design literature by providing a novel solution approach and presenting new theoretical and applied models. Using the proposed solution approach, we are able to formulate models that consider joint facility location and inventory management problems in a stochastic environment. Due to these uncertainties, it is important to design the supply chain that better adapts to unexpected changes.

In Chapter 2, we study several joint location-inventory problems. In particular, we consider cases with uncapacitated facilities, capacitated facilities, correlated retailer demand, stochastic lead times, and multi-commodities. We show how to formulate these problems as conic quadratic mixed-integer problems. We compare with the existing modeling and solution methods to state that the new conic integer programming approach not only provides a more general modeling framework but also leads to fast solution times in general. Valid inequalities, including extended polymatroid and extended cover cuts, are added to strengthen the formulations and improve the computational results.

In Chapter 3, we employ the technique presented in the previous chapter to explore the supply chain design problem that incorporates reverse logistics decisions. Supply chains with returned products are receiving increasing attention in the operations management community and this chapter studies a capacitated facility location model with bidirectional flows and marginal value of time for returned products. While at the retailers' site, products can be shipped back to the supplier for reprocessing. Each distribution center is capacitated and handles stocks of new and/or returned product.

In Chapter 4, we study another applied area that is getting increasing attention in the operations management community: the nonprofit sector. Under some circumstances nonprofit practices can significantly differ from for-profit ones and this might require a different design of the supply chain. This chapter starts with a definition of the nonprofit supply chain identifying its major managerial challenges. Then, we provide a summarized comprehensive overview of current operations management literature that address each major challenge. The second part of the chapter studies a particular nonprofit supply chain design problem in the context of a humanitarian organization distributing food in a less secure area.