Using Blockchain Technology to Extend the Vendor Managed Inventory for Sustainability
Abstract:Nowadays, Information Technology (IT) is changing the way traditional enterprise management concepts work. One of the most dominant IT achievements is the Blockchain Technology. This technology enables the distributed collaboration of stakeholders for their interactions while fulfilling the security and consensus rules among them. This paper has focused on the application of Blockchain technology to enhance one of traditional inventory management models. The Vendor Managed Inventory (VMI) has been considered one of the most efficient mechanisms for vendor inventory planning by the suppliers. While VMI has brought competitive advantages for many industries, however its centralized mechanism limits the collaboration of a pool of suppliers and vendors simultaneously. This paper has studied the recent research for VMI application in industries and also has investigated the applications of Blockchain technology for decentralized collaboration of stakeholders. Focusing on sustainability issue for total supply chain consisting suppliers and vendors, it has proposed a Blockchain based VMI conceptual model. The different capabilities of this model for enabling the collaboration of stakeholders while maintaining the competitive advantages and sustainability issues have been discussed.
 J. Delaram and O. F. Valilai, “Development of a Novel Solution to Enable Integration and Interoperability for Cloud Manufacturing,” in Procedia CIRP, 2016, vol. 52.
 S. H. R. Pasandideh, S. T. A. Niaki, and P. Ahmadi, “Vendor-managed inventory in the joint replenishment problem of a multi-product single-supplier multiple-retailer supply chain: A teacher-learner-based optimization algorithm,” J. Model. Manag., vol. 13, no. 1, 2018.
 J. Delaram and O. Fatahi Valilai, “An architectural view to computer integrated manufacturing systems based on Axiomatic Design Theory,” Comput. Ind., vol. 100, 2018.
 E. Aghamohammadzadeh, M. Malek, and O. F. Valilai, “A novel model for optimisation of logistics and manufacturing operation service composition in Cloud manufacturing system focusing on cloud-entropy,” Int. J. Prod. Res., vol. 58, no. 7, pp. 1987–2015, Apr. 2020.
 G. Bodaghi, F. Jolai, and M. Rabbani, “Evaluating supply chain flexibility under demand uncertainty with smoothing approach and VMI considerations,” J. Ind. Prod. Eng., vol. 35, no. 8, 2018.
 H. Mokhtari and M. T. Rezvan, “A single-supplier, multi-buyer, multi-product VMI production-inventory system under partial backordering,” Oper. Res., vol. 20, no. 1, 2020.
 E. Aghamohammadzadeh and O. Fatahi Valilai, “A novel cloud manufacturing service composition platform enabled by Blockchain technology,” Int. J. Prod. Res., vol. 58, no. 17, pp. 5280–5298, 2020.
 F. Casino, T. K. Dasaklis, and C. Patsakis, “Enhanced Vendor-managed Inventory through Blockchain,” in 2019 4th South-East Europe Design Automation, Computer Engineering, Computer Networks and Social Media Conference (SEEDA-CECNSM), 2019, pp. 1–8.
 J. Wang, J. Liu, and L. Zheng, “Construction of VMI Mode Supply Chain Management System Based on Block Chain: 18th International Conference, ICA3PP 2018, Guangzhou, China, November 15-17, 2018, Proceedings, Part IV,” 2018, pp. 611–616.
 W. Adrian, H. Malcolm, and G. Paul, “The sustainability debate,” Int. J. Oper. Prod. Manag., vol. 21, no. 12, pp. 1492–1502, Jan. 2001.
 D. Spina, L. Di Serio, L. Brito, and A. L. Duarte, The influence of supply chain management practices in the enterprise performance. 2014.
 B. K. Irungu and K. Wanjau, “Effectiveness of vendor managed inventory systems in retail supermarkets in Kenya,” Int. J. Bus. Public Manag., vol. 1, no. 1, pp. 194–205, 2011.
 M. Y. Jaber and S. K. Goyal, “Coordinating a three-level supply chain with multiple suppliers, a vendor and multiple buyers,” Int. J. Prod. Econ., vol. 116, no. 1, pp. 95–103, 2008.
 H.-M. Wee, M.-C. Lee, J. C. P. Yu, and C. Edward Wang, “Optimal replenishment policy for a deteriorating green product: Life cycle costing analysis,” Int. J. Prod. Econ., vol. 133, no. 2, pp. 603–611, 2011.
 R. Malla and V. Prem, “Vendor managed inventory model: a case study,” J. Adv. Manag. Res., vol. 4, no. 1, pp. 83–88, Jan. 2007.
 T. T. Niranjan, S. M. Wagner, and S. M. Nguyen, “Prerequisites to vendor-managed inventory,” Int. J. Prod. Res., vol. 50, no. 4, pp. 939–951, Feb. 2012.
 A. Gunasekaran, Z. Irani, and T. Papadopoulos, “Modelling and analysis of sustainable operations management: certain investigations for research and applications,” J. Oper. Res. Soc., vol. 65, no. 6, pp. 806–823, Jun. 2014.
 V. Scuotto, F. Caputo, M. Villasalero, and M. Del Giudice, “A multiple buyer – supplier relationship in the context of SMEs’ digital supply chain management,” Prod. Plan. Control, vol. 28, no. 16, pp. 1378–1388, Dec. 2017.
 S. P. Nachiappan and N. Jawahar, “A genetic algorithm for optimal operating parameters of VMI system in a two-echelon supply chain,” Eur. J. Oper. Res., vol. 182, no. 3, pp. 1433–1452, 2007.
 Y. Dong and K. Xu, “A supply chain model of vendor managed inventory,” Transp. Res. Part E Logist. Transp. Rev., vol. 38, no. 2, pp. 75–95, 2002.
 C. C. Lee and W. H. J. Chu, “Who should control inventory in a supply chain?,” Eur. J. Oper. Res., vol. 164, no. 1, pp. 158–172, 2005.
 M.-J. Yao and C.-C. Chiou, “On a replenishment coordination model in an integrated supply chain with one vendor and multiple buyers,” Eur. J. Oper. Res., vol. 159, no. 2, pp. 406–419, 2004.
 S. Minner, “Multiple-supplier inventory models in supply chain management: A review,” Int. J. Prod. Econ., vol. 81–82, pp. 265–279, 2003.
 H. Shin, D. A. Collier, and D. D. Wilson, “Supply management orientation and supplier/buyer performance,” J. Oper. Manag., vol. 18, no. 3, pp. 317–333, 2000.
 T. Dasaklis and F. Casino, “Improving Vendor-managed Inventory Strategy Based on Internet of Things (IoT) Applications and Blockchain Technology,” in 2019 IEEE International Conference on Blockchain and Cryptocurrency (ICBC), 2019, pp. 50–55.
 D. R. Kwame and K. S. Abekah, “Marketing and entrepreneurial success in emerging markets: the nexus,” Asia Pacific J. Innov. Entrep., vol. 13, no. 2, pp. 168–187, Jan. 2019.
 F. Casino, T. K. Dasaklis, and C. Patsakis, “A systematic literature review of blockchain-based applications: Current status, classification and open issues,” Telemat. Informatics, vol. 36, pp. 55–81, 2019.
 N. Kshetri, “1 Blockchain’s roles in meeting key supply chain management objectives,” Int. J. Inf. Manage., vol. 39, pp. 80–89, 2018.
 S. K. Srivastava, “Green supply-chain management: A state-of-the-art literature review,” Int. J. Manag. Rev., vol. 9, no. 1, pp. 53–80, Mar. 2007.
 C. S. Huoy, S. A. Rahim, N. A. A. Rahman, M. N. M. Nawi, and A. Ahmi, “Determination the key success factor for the success implementation and long-term sustainability of vendor managed inventory (VMI),” Int. J. Supply Chain Manag., vol. 7, no. 2, pp. 62–67, 2018.
 J. Liu, F. Huang, and C. Ma, “Coordination of VMI supply chain with replenishment tactic under risk aversion and sales effort,” 4OR, 2020.