A Simulation Analysis to Select Structures and Suppliers of Modular Multi-Product Supply Chains Under Demand and Lead-time Uncertainty

Modular product architecture becomes more and more popular to companies that produce great variety of products. Common modules shared across the variety of products enables to efficiently respond to continuously fluctuating demands. This study addresses a problem of designing a supply chain of parts and modules that compose multiple types of products. It investigates appropriate supply chain structures and suppliers under given major supply-chain characteristics, which are how uncertain demand and lead time are, where module suppliers are located and how valuable a module is. This study conducted simulation analysis under 168 combinations of those four parameter levels, and explored the design that minimizes supply-chain costs. An additional analysis reveals conditions of such optimality.