STEEL SUPPLY CHAIN MANAGEMENT BY SIMULATION MODELLING

This paper presents a simulation modelling of the "Steel Supply Chains" to demonstrate the effect of information sharing in the inventory level reduction. A framework is presented for a better understanding of the importance of the order information in the chains. The choice of concepts and final construction of the framework is informed by an empirical research where data was collected from two steel manufacturing case companies and simulated by using discrete event simulation. Design of experiment showed that information sharing mitigates the bullwhip effect by reducing buffer stock level in steel supply chains. Production and delivery sequencing is also important in terms of buffer stock level reduction. Simulation gives benefit to managers by showing the dynamic behaviour of inventory level in steel supply chain. Finally, a simulation model contributes to the steel supply chain in the development of task scheduling and order prioritization rule.