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Managing Perishables with Time and Temperature History
Author(s) -
Ketzenberg Michael,
Bloemhof Jacqueline,
Gaukler Gary
Publication year - 2015
Publication title -
production and operations management
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 3.279
H-Index - 110
eISSN - 1937-5956
pISSN - 1059-1478
DOI - 10.1111/poms.12209
Subject(s) - supply chain , context (archaeology) , markov chain , computer science , product (mathematics) , information flow , markov decision process , value of information , operations research , lead time , supply chain management , value (mathematics) , operations management , markov process , business , economics , marketing , mathematics , statistics , paleontology , linguistics , philosophy , geometry , machine learning , artificial intelligence , biology
We address the use and value of time and temperature information to manage perishables in the context of a retailer that sells a random lifetime product subject to stochastic demand and lost sales. The product's lifetime is largely determined by the temperature history and the flow time through the supply chain. We compare the case in which information on flow time and temperature history is available and used for inventory management to a base case in which such information is not available. We formulate the two cases as Markov Decision Processes and evaluate the value of information through an extensive simulation using representative, real world supply chain parameters.