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On “Sourcing Decisions with Stochastic Supplier Reliability and Stochastic Demand”
Author(s) -
Yan Xiaoming
Publication year - 2018
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.12807
Subject(s) - heuristics , computer science , reliability (semiconductor) , mathematical optimization , operations research , mathematical economics , economics , mathematics , physics , power (physics) , quantum mechanics
This note complements the study of Burke, Carillo and Vakharia (hereafter referred to as “BCV model”), which investigates the implications of unreliable supplies on a firm's sourcing decisions under uniformly distributed demand. First, I present a sufficient condition under which the optimal quantity ordered from each supplier corresponds to the solution derived as BCV. Second, a heuristics is developed for the BCV model when the sufficient condition is not satisfied, and conduct numerical experiments to investigate the performance of the BCV solution when the optimality conditions fail.