Models of Supply Chain Essay

Models for Supply Chains in E-Business
Kenan-Flagler Business School, University of North Carolina, Chapel Hill, North Carolina 27599 Graduate School of Industrial Administration, Carnegie Mellon University, Pittsburgh, Pennsylvania 15213

Jayashankar M. Swaminathan • Sridhar R. Tayur

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upply chain management is likely to play an important role in the digital economy. In this paper, we first describe major issues in traditional supply chain management. Next, we focus our attention on the supply chain issues of visibility, supplier relationships, distribution and pricing, customization, and real-time decision technologies that have risen to importance with the prevalence of e-business. We present an overview of relevant analytical research models that have been developed in these areas, discuss their contributions, and conclude with a discussion on future modeling opportunities in this area. (Supply Chain Management; Electronic Business; Collaboration; Information Sharing; Decision Support; Supplier Relations; Procurement; Distribution; Customization; Literature Survey )

1. Introduction

It is estimated that e-commerce in the United States will grow from $72 billion in 2002 to approximately $217 billion by 2007, according to a recent Forrester research report (Johnson et al. 2002). While the predicted numbers may not be exact, there is no doubt that the rapid growth and adoption of the Internet has already had a great impact on all aspects of business, including customer acquisition, marketing, human resource management, finance, information systems (IS), and operations. Supply chain management that has played an important role in traditional businesses is likely to be crucial in the digital economy as well (Geoffrion and Krishnan 2001). Keenan and Ante (2002) note that during the next five years, collaboration by supply chain partners over the Internet can potentially save $223 billion with the reduction in transaction, production, and inventory costs....