(10 Marks)

Question 1

 Question 1.1 Draw a “chaining system” for a supply chain network of 4 plants
and 4 products. We call such a supply chain network a “4 by 4 system”. Similarly,
we will refer to a supply chain network of 5 plants and 5 products as a “5 by 5
system”. Following the same logic, we will refer to a supply chain network of N
plants and N products as an “N by N system”.

Plants Products
1 1
2 2
3 3
4 4

Question 1.2 Recall that when you link Product 1 with Plant 1, it means Plant 1 can
produce Product 1. How many links does a “chaining system” for a “10 by 10 system”
have? How many links does a “total flexibility system” for a “10 by 10 system” have? What
is the ratio of the links used in the “chaining system” to the “total flexibility system” in this
question? As explained in Week 5 recorded lecture (using Week 4 BMS5209 PPT.pptx), the
expected sales and expected capacity utilization achieved by the “chaining system” are very
close to the “total flexibility system” for such a “10 by 10 system”.

Chaining System for a 10 by 10

=2N

=20 LINKS

Total flexibility system

=N*N

=100 LINKS

Ratio

=2N/N*N

=0.2

 Question 1.3 Consider a "10 by 10 system". Is it true that any "10 by 10

system" with the same number of links of the "chaining system" can achieve the
same level of expected sales and expected capacity utilization as the “chaining
system”? If your answer is yes, eat some chocolates and listen to the recorded
lesson again. If your answer is no, give a counterexample and explain why you
 think your counterexample has a different level of expected sales and expected
capacity utilization compared with the “chaining system”.

No, because the products are not evenly distributed across plants.

 Question 1.4 Recall that when you link Product 1 with Plant 1, it means Plant
1 can produce Product 1. How many links does a “chaining system” for a “100
by 100 system” have? How many links does a “total flexibility system” for a
“100 by 100 system” have? What is the ratio of the links used in the “chaining
system” to the “total flexibility system” in this question? Note that for normally
distributed demand and commonly seen demand variability, then based on what
we learned in slide 20, the ratio of the expected sales from the chaining system to
the total flexibility system is about 96%.

Chaining System for a 100 by 100

=2N

=200 LINKS

Total flexibility system

=N*N

=10000 LINKS

Ratio

=2N/N*N

=0.02

 Question 1.5 Recall that when you link Product 1 with Plant 1, it means Plant
1 can produce Product 1. How many links does a “chaining system” for a “1000
by 1000 system” have? How many links does a “total flexibility system” for a
“1000 by 1000 system” have? What is the ratio of the links used in the “chaining
system” to the “total flexibility system” in this question? If the demand follows a
normal distribution with commonly seen demand variability, then based on what
we learned in slide 20, is it true that the ratio of the expected sales from the
chaining system to the total flexibility system is about 96%?

Chaining System for a 1000 by 1000

=2N

=2000 LINKS

Total flexibility system

=N*N

=1000000 LINKS
 Ratio

=2N/N*N

=0.002

Yes, , is it true that the ratio of the expected sales from the chaining system to the total
flexibility system is about 96%

 Question 1.6 Recall that when you link Product 1 with Plant 1, it means Plant
1 can produce Product 1. How many links does a “chaining system” for a
“10000 by 10000 system” have? How many links does a “total flexibility system”
for a “10000 by 10000 system” have? What is the ratio of the links used in the
“chaining system” to the “total flexibility system” in this question? If the demand
follows a normal distribution with commonly seen demand variability, then based
on what we learned in slide 20, is it true that the ratio of the expected sales from
the chaining system to the total flexibility system is about 96%?

Chaining System for a 10000 by 10000

=2N

=20000 LINKS

Total flexibility system

=N*N

=100000000 LINKS

Ratio

=2N/N*N

=0.0002

Yes, , is it true that the ratio of the expected sales from the chaining system to the total
flexibility system is about 96%

 Question 1.7 For a supply chain network of 20 plants and 300 products, is there a
method that can help us to use much less links than the number of links required
for the “total flexibility system” to achieve a similar level of expected sales as the
“total flexibility system”? If your answer is yes, congratulations! If your answer is
no, listen to the recorded lesson again and check out the “Expansion Ratio
Heuristics”. In any case, you deserve an ice cream and a good sleep! Don’t stay up
too late for this.

Yes, Expansion Ratio Heuristics method can help us to use much less links than
the number of links required for the “total flexibility system” to achieve a similar
level of expected sales as the “total flexibility system”