Application of an analytical network process to strategic planning problems of a supply chain cell: case study of a pharmaceutical firm

Abstract

In order to ensure the success of companies’ competitive strategies, supply chain management has gained much prominence in the last few years. In India many organizations preferred to have a separate supply chain cell (SCC) to promote products, responsiveness and to constantly overview the price tags. SCC is a new cross-functional area and armed with integration of production planning, dispatch order generation, logistics planning and distribution to meet broadened objectives of the companies. In this paper both qualitative and quantitative factors affecting the strategic goals connected with the SCC are considered using an analytical network process (ANP). The model formulation adopting ANP methodology generally helps solving not only the complex and systematic decision problems but also aims to address existing interdependencies among non-quantifiable factors associated with branching and manufacturing locations. This paper reports an application of proposed methodology as a case study related to a pharmaceutical company having 14 production locations and 22 branching/clearing and forwarding agents. The analysis aims at the optimization of total supply chain costs and also suggests the measures realizing improvement in turnover and reduction of carrying costs.