Lean supply chain of service companies : application of order review and release systems to improve its performances

Abstract: This research aims to contribute to the theoretical knowledgebase about supply chains in service companies and lean implementation in this area. The focus of the study is testing the feasibility of order review and release systems application, which proved to be effective in “leaning” the flow of manufacturing companies, to the service supply chain. The influence of one of the main characteristics of services – processing times variability and preciseness in estimating the required processing times, is studied. The research is purely theoretical and was conducted with the help of simulation modeling. The model of the service supply chain was developed based on the literature review and statistical distributions as an input data were used. Two kinds of order review and release systems are considered: upper-bound limited workload and lean-based balanced workload model. Their impact on the performance of the service supply chain is described and compared to the results of the model with immediate release. The findings show that order review and release systems can perform well even in the conditions of unknown exact processing times and thus can be applied to services as well as they are applied in manufacturing. The application of order review and release systems will help to eliminate waste within the service supply chain, make it more flexible and thus increase added value to the customers.