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A study of joint decision of demand substitution and manufacturing process flexibility in context of supply chain. (Chinese. English summary) Zbl 1413.90151
Summary: Manufacturing process flexibility in the supply end as well as product substitution in the demand end could both be utilized by firms to reduce the negative impact by demand uncertainty. Taking into account the substitution cost and only a fraction of consumers will accept the substitution, we study the interplay between the process flexibility and demand substitution and investigate the conditions under which the four distinct flexibility structures will benefit the firm. We then illustrate our results by numerical simulation. The article further draws some managerial implications for practitioners.
MSC:
90B50 Management decision making, including multiple objectives
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