3.1 General requirements on supply chain modelling
As stated a typical supply chain involves multiple (semi)autonomous parties, who may
have several, possibly conflicting, objectives. Actions of one actor in the supply chain
may influence product and/or process characteristics for the next actor. SCM requires,
among others, the alignment of partner strategies and interests, high intensity of
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Downloaded by information sharing, collaborative planning decisions and shared IT tools. These
requirements often represent major hurdles inhibiting the full integration of a logistics
chain. Even when there is a strong partnership among logistics nodes, in practice, there
are potential conflict areas, such as local versus global interests, and a strong
reluctance of sharing common information on production planning and scheduling,
such as, for example, inventory and capacity levels (Terzi and Cavalieri 2004). SCM
requires trust and in-depth insight into each other’s processes, which is difficult, since
the widely followed competitive model suggests that companies will lose bargaining
power, and therefore the ability to control profits, as suppliers or customers gain
knowledge (Barratt and Oliveira 2001).
The aforementioned characteristics make clear that an active participation and
cooperation of all parties are essential ingredients for the effective design of new supply
chain network scenarios. Even more since the complexity of the system and the solution
space in terms of the number of alternative chain scenarios are significant. Involvement is
therefore not only a prerequisite for solution acceptance, but also fosters creative minds in
finding alternative and possibly better solutions – building on each other’s expertise on
specific chain operations. In order to facilitate an active involvement of decision makers in
modelling and solution finding, high demands are set on model transparency and
completeness. Transparency refers to the insight into model components and their
workings, whereas completeness addresses a full overview of design parameters. This leads
us to the following requirements on simulation model design