Information Technology Reference
In-Depth Information
The logistics professional expects a computer to give all possible demand supply network combina-
tions and associated costs for the input entered. The DSNnet instance in Figure 2 depicts the sourcing
options for the product structure in Figure 1. Notice the inclusion of 'AND' nodes before single suppliers.
Since volume splits between multiple suppliers are possible at every tier of the supply chain, the generic
translation routine from product structure to DSNnet includes an AND-node after every OR-node. The
AND node is really needed only in the 60/40 split of Suppliers 1 and 2 for Module B in Figure 2.
After the generation of DSNnet above, a reachability analysis algorithm is executed to determine
the demand supply network options and costs for each. For this example, there were no costs specified
but the possible demand supply networks are:
1. End Product Manufacturer - 100% volume
Supplier 1 for Module B - 100% volume
Supplier 1 for Module C - 100% volume
2. End Product Manufacturer - 100% volume
Supplier 1 for Module B - 100% volume
Supplier 2 for Module C - 100% volume
3. End Product Manufacturer - 100% volume
Supplier 1 for Module B - 60% volume
Supplier 2 for Module B - 40% volume
Supplier 1 for Module C - 100% volume
Figure 2. DSNnet describing sourcing options for the product in Figure 1
Customer 1
End Product
Manufacturer
AND
OR
OR
AND
AND
AND
AND
60%
40%
Supplier 1 for
Module B
Supplier 2 for
Module B
Supplier 1 for
Module C
Supplier 2 for
Module C
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