Lead-time Reduction And Coordination Mechanism Under Two-echelon Supply Chain Based On P Company

The competition based on time has been a kind of mainstream competition mode since1990s, which has a direct effect on the operation management，especially on supply chain leadtime reduction. Lead time reduction is a efficient way to meet the supply chain responsecustomers’ needs and a effective means to form strategic advantages.This paper first introduced P company’s actual situations, and analyzed the problemsexisting in S supply chain. Then established profit models based on P company. For oneproduct, we compared the profits and the reduction quantity under decentralized decision andcentralized decision. Furthermore we extended to the problems of multi-product’s lead timereduction and got multi-product’s lead time reduction and coordination mechanism. Finallywe considered the established models with the data of P company and gained someconclusions. One product’s lead time can be shorted approximately to10weeks undercentralized decision, better than decentralized decisions. And through the price coordinationmechanism the supplier were willing to accept centralized decision. It is demonstrated that theprofits under multi-product one delivery is higher than under multi-product multi-delivery andlead time can be shorted to approximately10or11weeks. Furthermore the supply chain canachieve coordination by adopting the price coordinated under centralized decision.