A case-based roadmap for lateral transshipment in supply chain inventory management

Authors

  • Henry Lau Western Sydney University
  • Dilupa Nakandala Western Sydney University
  • Paul Shum Western Sydney University

DOI:

https://doi.org/10.4301/S1807-17752016000100002

Keywords:

Lateral transshipment, inventory management, decision rules, roadmap

Abstract

Manufacturers and wholesalers are increasingly cost conscious in response to today’s hyper-competitive environment. Lateral transshipment (LT) has been proposed as a viable solution to drive total inventory costs down whilst increasing customer service level. Our study proposes five LT decision rules with a case-based roadmap to guide professional inventory management. Results of this large fast moving consumer goods case study company demonstrate superior inventory management performance with implementing a combined reactive and proactive LT strategy to determine whether to transship emergency stock from other warehouse or to backorder from suppliers, size of transshipment, favorite wholesaler, preferred supplier, and extra quantity for preventive LT, which are the key LT decision points among the professional supply chain management practitioners.

Author Biographies

Henry Lau, Western Sydney University

Henry Lau is currently a senior lecturer of the School of Business at The University of Western Sydney, involved in research and teaching activities. He received his Doctorate at the University of Adelaide in 1995. His current research areas cover logistics and supply chain management, operations research, engineering management and artificial intelligence systems. He has published about 230 refereed journal papers and attracted a total of HKD 20 million (about AUD 3 million) in research grants during his time in HK PolyU. In addition, he has 4 patents and won 3 International awards for achievements in innovation. He has also attracted an ARC Discovery grant in the area of supply chain and logistics area as chief investigator.

Dilupa Nakandala, Western Sydney University

Dilupa Nakandala is a lecturer at the School of Business, University of Western Sydney, Australia. She obtained BSc in electrical and electronic engineering (First Class) at the University of Peradeniya in 1998, MBA at the University of Moratuwa in 2004 and PhD in innovation studies at the University of Western Sydney in 2010. Dilupa is a certified project management professional of the PMI, USA. She has over eight years of industry experience in project and business management in the information technology industry. Her research interests are in innovation and technology management, decision support systems,logistics management and information management.

Paul Shum, Western Sydney University

Paul Shum is currently a research fellow participating in an ARC-funded project on supply chain management. Over the last two years, Paul was an Assistant Professor, teaching finance and economics at the Hong Kong Shue Yan University. He is also the Director of Finance of a startup software company incubated at the Hong Kong Science and Technology Park, adjacent to the Chinese University of Hong Kong. Prior to his appointments in Hong Kong, Paul worked at universities in Australia. Before joining the academic field, Paul had more than fifteen years of industry experience in accounting, marketing and management. He has been a fellow CPA for ten years. He holds an MBA from the University of Adelaide, a PhD, a B Econ (Hon), a Grad Dip in Advanced Manufacturing Technology, and a Grad Dip in Accountancy.

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Published

2016-04-19

How to Cite

Lau, H., Nakandala, D., & Shum, P. (2016). A case-based roadmap for lateral transshipment in supply chain inventory management. Journal of Information Systems and Technology Management, 13(1), 27–44. https://doi.org/10.4301/S1807-17752016000100002

Issue

Vol. 13 No. 1 (2016)

Section

Articles

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