Preface

This book is aimed at an important and underserved niche within the supply chain educational market: strategic supply chain network design. Almost all supply chain professionals need to know about this discipline, and this book is meant to help them do it well.

Strategic network design is about selecting the right number, location, and size of warehouse and production facilities. At the same time, firms will need to determine the territories of each facility, which product should be made where, and how product should flow through the supply chain.

Typically, these studies do not produce a single correct answer. Instead, strategic network design planning requires you to construct a logical mathematical model of your supply chain, use powerful optimization engines to sort through the seemingly countless possibilities to return the optimal solution, and then analyze the results of many different scenarios to support a good operational decision. Fortunately, commercially available software takes care of the calculations for you. However, it is important that you understand what the optimization engine is doing so you can construct better models and deliver better results.

This is an educational book for those who have to do this work and managers who are responsible for an efficient supply chain. Most books in this area are too high level and don’t provide enough detail to actually do such work at a firm or to even know whether the principles are being correctly applied. We are going to start with the fundamentals and build on that. Along the way, we will provide you with the practical aspects of the problem, the key insights and intuition from each section, and some background on the theory.

This book covers both the theory and the practice of this discipline in a way that ensures that readers will be successful when implementing strategic network design planning in their respective fields. Doing this work well requires an understanding of the theory. We have included sections on the mathematical formulations of the problems to give you, the reader, a deeper appreciation of how solutions are found. However, since this is a business book, you can skip the math formulations without loss of continuity (but if you skip the equations, we still suggest you read the description to gain additional insight). We will also cover how to get answers in the complexity of the real world. The text is combined with interactive exercises using commercially available software as well. The use of the commercially available software enhances the course and its use may also be skipped without loss of continuity.

This topic is very rich and deep. Several books could be written to cover all the clever ways network design modeling is used in industry and all the different decisions and factors you can consider. Even though we cannot cover every topic and every nuance, this book is meant to introduce you to the topic and give you the foundation to build these more complex models over time. We have found that doing these projects will help build up your skills and insights. This book is meant to get you started in the right direction.

The authors of this book all have extensive experience with these types of projects. We have run hundreds of studies; presented results to managers, CEOs, and boards of directors; and even legally testified on the results to the U.S. Government. We have designed and coded this type of commercial software used by many companies and organizations in many different industries all around the world. We have trained others to do these projects on their own. We have also taught this subject matter in leading universities. All these experiences together have brought us to realize the value of bringing the contents of this book to students and business professionals worldwide.

We want you to be able to learn from our experience.

For those new to the field, we want you to understand and appreciate this interesting discipline.

For those who will need to do this professionally, we want you to be able to do these projects better and with a deeper understanding.

For those who will need to manage these types of projects, we want you to be able to provide better guidance to your team and deliver better results.

For those who teach this material, we want this material to help make your course richer. We want you to have insight into how this gets implemented in practice and gain access to realistically sized problems. You can also use this material to expand into other supply chain areas as appropriate for your course. This book would be appropriate for courses in Supply Chain, Operations Research, Industrial Engineering, or an MBA or Business program. Supply chain network design is about determining the best supply chain to physically move product from the source to the final destination. As such, this topic gives you a great sense of a firm’s supply chain and how a firm works. It also touches very strategic business issues such as cost, service, and risk.

For everyone, we hope you find the contents of this book interesting and helpful over the course of your careers.

Book Web Site

This book is written so that it can be valuable as standalone text and enhanced with the ability to do hands-on exercises. By working on the hands-on exercises, you can reinforce the learning from the text and explore the concepts on your own.

The Web site for this book is www.NetworkDesignBook.com.

Information on the exercise materials can be found at www.NetworkDesignBook.com/academic-use/.

In the “Course Material” section, you will find the following:

• Models from the chapters so you can work with the same models we mention in the text

• Excel files with data referenced in the chapters

• Instruction manuals for using the software with the book

• Models and Excel files for the end of chapter exercises

• Additional questions and case studies to keep the material fresh and to allow you to explore new areas

• Updates to the text through time

• Instructor materials, if you are teaching from the book

The other sections of the Web site have additional information, such as links to references, case studies, and recent developments, to enhance the value of the book.