Performance Analysis of a Two Stage Supply Chain Network Using Simulation - A Case Study

This paper is the result of a work carried out in analyzing the performance of a two stage supply chain network (SCN). The work has been undertaken at two electronic component manufacturing companies. Company A, a sister concern of an electronic company, manufactures primary components namely - deflection yokes, fly back transformers and tuners. The Company B, comprising of three subsidiary business units, is a second tier supplier to an electronic product company and a dedicated supplier to Company A. They manufacture plastic components like bobbins, resin cases and tube cases, all of which are used as components for the production of yokes and transformers. After studying the existing system, the objectives set were to reduce the supply chain lead-time at Company A, and reduction of inventory levels at Company B. A model was developed using ARENA, a simulation software package for company A. The results included a reduction of 32% in the lead-time for fulfilling an order at company A. The delivery performance to commitment date also increased to a high of 76% from the earlier 20%. Company B on the other hand, had 40-50% reduction in raw material inventories. The finished goods inventories came down to 1-1.5 days of supply from an earlier figure of 8 14 days of supply in company B.