Modeling of S&OP in a large scale Dairy supply chain

Despite Sales and Operations Planning (S&OP) is widely known in today’s supply chain literature, quantitative estimation of its impact on supply chain’s performance has been neglected. Furthermore, no research exists on mathematical modeling of S&OP in dairy industry. In this study, three novel Fuzzy Mixed Integer Linear Programming (f-MILP) models have been presented to investigate the benefits of S&OP on supply chain’s total performance: a Fully Integrated S&OP (FI-S&OP) model, a Partially Integrated S&OP (PI-S&OP) model, and a decoupled planning (DP) model. Also, triangular fuzzy numbers (TFNs) are employed in order to represent uncertainty and vagueness associated with real world operations. All these models are developed for a multi-site manufacturing company, which is coping with various raw material suppliers and Third Party Logistics (3PLs), Distribution Centers (DCs), and customers with wide range of product families. Finally, all the models are applied in a real case in a dairy manufacturing company in Iran. The results demonstrate a slight superiority of FI-S&OP over PI-S&OP model and a strong domination over DP model.