Supply Chain Management

The research focus Supply Chain Management covers the fields Procurement & Sourcing and Supply Chain Risk Management

Procurement & Sourcing:

Procurement represents a very large portion of the total economic activity. The value of public procurement transactions in EU countries is about 16 percent of their GDP, while in the United States it is around 20 percent. In the private sector, the value of transactions is even larger and, due to the current trend towards outsourcing all non-core business activities, steadily increasing. Therefore, an effectively and efficiently operating purchasing and supply function can make an important contribution towards the results of a company or costs savings in the public sector. Procurement design directly and substantially affects the performance of a firm or country, both in the short and in the long run.

Therefore, we conduct research on problems, concepts and technologies of logistics and operations strategy and develop decision support techniques to make decisions in centralized and decentralized value chains. 

In particular, we focus on commodity procurement topics. For reasons of flexibility, commodities like oil, electricity or raw materials are increasingly purchased at spot markets. In contrast to long-term purchasing contracts, this strategy is characterized by a high price risk. We develop stochastic models that consider price uncertainty in procurement decisions. Optimal procurement policies that are often based on a combination of hedging instruments (futures, forwards, options) are derived. 

Further research topics in the field of Procurement & Sourcing are: Auctions in materials and transportation procurement, supplier performance measurement and incentive schemes in buyer-supplier relations.

Supply Chain Risk Management:

Risks like natural disasters, political unrest or labor strikes contribute to the vulnerability of companies' supply chains. For example the nuclear catastrophe of Fukushima in 2011, led to supply shortages of automotive OEMs worldwide. 

In the field of Supply Risk Management we deal with all kinds of risk that arise along a company's supply chain like e.g. currency exchange rate risk, tax and duty risks, supply and disruption risk. Future scenarios serve as input for stochastic decision-support models that can be used for risk-robust location and supplier selection decisions. We develop methods to decompose large optimization problems under uncertainty and solve these problems using state-of-the-art approximation methods. To identify levers for improving risk management processes in practice, we administer large-scale surveys. Expert interviews with industry leaders enrich findings and support cross-checks.

Interested in more information? Please contact Christian Mandl.

Exemplary publications

  • Arnold, J., Minner, S. (2011), Financial and Operational Instruments for Commodity Procurement in Quantity Competition, International Journal of Production Economics 131(1), 96-106.
  • Zöbeley, B., Minner, S., Kilger, C. (2011), Incentive Alignment at the Manufacturing-Marketing Interface - Design and Validation of a management Game, Logistics Research 3(2): 89-100.
  • Budde, M., Minner, S. (2015), Optimal capacity provision for service providers with subsequent auctioning of projects, accepted in International Journal of Production Economics.
  • Silbermayr, L., Minner, S. (2015), Dual sourcing under disruption risk and cost improvement through learning, Working paper.