A coordination framework for supply chain inventory alignment

Purpose – A traditional supply chain, all too often, is a sequence of weakly connected activities both within and outside the organization and leads to many misalignments. Tackling this inherent lack of coordination is a major value creation opportunity for supply chain managers. This paper aims to present a coordination framework, called ASCEND, to align the inventory decisions in decentralized supply chains.Design/methodology/approach – The framework rests on three pillars – multi‐agent technology, coordination theory, and optimization technology. Inventory alignment is transformed into a decentralized constraint satisfaction optimization problem, which is then solved using a genetic algorithm‐based coordination process. The guiding principle of this framework is the establishment of a proper incentive alignment mechanism through cost‐sharing and service level contracts, taking into account the associated dependencies.Findings – The results of the pilot study indicate that the coordination framework red...