The application of system dynamics and discrete event simulation in supply chain management of Swedish manufacturing industries

Abstract: Increasing competition from traditional and emerging channels has placed new emphasis on rapid innovation and continuous differentiation in every aspect of supply chain, from earliest production stage to the final distribution steps. To bridge the gap between brilliant ideas and successful business initiatives, leading companies implement engineering simulation particularly in logistics and supply chain management (LSCM). Discrete event simulation (DES) and system dynamics (SD) are two modeling approaches widely used in this field. However there are not much done researches about the applications of these simulation approaches in supply chain context of Swedish Manufacturing Industries (SMI). This study explores the application of DES and SD in LSCM of SMI by looking at the nature and level of issues modeled. Journal papers and master theses that use these modeling approaches to study supply chains, published between 1990 and 2012 are reviewed. A total of 39 articles are analyzed to identify the frequency with which the two simulation approaches are used as modeling tools in LSCM of SMI. Our findings suggest that DES has been used more frequently to model supply chains in SMI. The results also show that not all the LSCM issues have been addressed evenly and generally tactical/operational issues have been modeled more frequently. The results of this study inform the existing literature about the use of DES and SD in LSCM of SMI.