A Study Of Telecom Operators Inventory Model Based On Supply Chain Cooperation

With the changes of internal and external environments, telecom industry is faced with the new requirements of market expansion, industrial cooperation, competition and operation. Competition based on supply chains has turned into a tendency more and more apparently, and the role of supply chain cooperation is becoming more and more significant in the value creation and competitiveness improvement of enterprises. This paper studies the issues of telecom supply chain cooperation in two aspects:(1) the cooperation of departments inside an enterprise;(2) the cooperation between upstream and downstream enterprises in a supply chain. Detailed studies are listed as follows.Through analysis and reviews of the internal cooperation of telecom supply chain, the strategies of "purchasing based on demand" and "purchasing based on inventory" are proposed and studied. For the strategy of "purchasing based on inventory", models have been constructed to study the issue of optimizing inventory centralization by balancing the inventory cost and responsiveness requirements of various materials in two-echelon inventory systems with defined inventory strategy and parameters.Quantity discount pricing models in a system consisting of a single supplier and multiple buyers are studied based on the assumption of deterministic demand. It is testified that the system cost can be optimized based on the parameter adjustment in different ordering structures including order coordination, order consolidation, and multi-tier ordering hierarchy.Patterns of inventory management applicable to China Telecom operators are introduced in the dimensions of material flow, information flow and cash flow. Cost models of supplier, buyer and system for CS and JMI are constructed and compared in a two-level system under a deterministic circumstance. Schemes of quantity discount pricing and ordering cost sharing are discussed to realize the Pareto optimality under JMI. Numeric examples are given to illustrate the problem of model selection and coordination.Cost models for IS and CS in a supply chain system consisted of a single supplier and a single buyer are developed by introducing the assumption of internal "1-n" structure of the buyer based on the practice of Chinese telecom operators. The costs of supplier, buyer and system under IS and CS are compared respectively. Moreover, the conditions under which the supplier, buyer or system would benefit for switching from IS to CS are deduced and compared in the system consisted of a single supplier and a buyer with and without internal "1-n" structure.Employing dynamic programming, expected profit models of the supplier, buyer and system are studied with the assumptions of random demand and deterministic demand distribution of two stages. With the constructed models, optimized expected profits of all the supply chain participants under distributed non-cooperative situation and centralized cooperative situation are compared, so as to figure out the choice of supplier or buyer under the circumstances of sudden changed demand. Numeric examples are given to illustrate the results.Further research directions are discussed briefly in the last part of the paper.