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VCU INFO 658 - Agent-Oriented Supply-Chain Management

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The International Journal of Flexible Manufacturing Systems, 12 (2000): 165–188c° 2000 Kluwer Academic Publishers, Boston. Manufactured in The Netherlands.Agent-Oriented Supply-Chain ManagementMARK S. FOX, MIHAI BARBUCEANU, AND RUNE TEIGENEnterprise Integration Laboratory University of Toronto, Ontario, CanadaAbstract. The supply chain is a worldwide network of suppliers, factories, warehouses, distribution centers, andretailers through which raw materials are acquired, transformed, and delivered to customers. In recent years, a newsoftware architecture for managing the supply chain at the tactical and operational levels has emerged. It views thesupply chain as composed of a set of intelligent software agents, each responsible for one or more activities in thesupply chain and each interacting with other agents in the planning and execution of their responsibilities. Thispaperinvestigatesissuesandpresentssolutions for the construction of such anagent-oriented software architecture.The approach relies on the use of an agent building shell, providing generic, reusable, and guaranteed componentsand services for communicative-act-based communication, conversational coordination, role-based organizationmodeling, and others. Using these components, we show two nontrivial agent-based supply-chain architecturesable to support complex cooperative work and the management of perturbation caused by stochastic events in thesupply chain.Key Words: software agents, coordination, interaction, supply chain1. IntroductionThe supply chain is a worldwide network of suppliers, factories, warehouses, distributioncenters, and retailers through which raw materials are acquired, transformed, and deliveredto customers. Supply-chain management is the strategic, tactical, and operational decisionmaking that optimizes supply-chain performance. The strategic level defines the supplychain network; that is, the selection of suppliers, transportation routes, manufacturing fa-cilities, production levels, warehouses, and the like. The tactical level plans and schedulesthe supply chain to meet actual demand. The operational level executes plans. Tactical- andoperational-level decision-making functions are distributed across the supply chain.To optimize performance, supply-chain functions must operate in a coordinated manner.But the dynamics of the enterprise and the market make this difficult: Materials do notarrive on time, production facilities fail, workers are ill, customers change or cancel orders,and so forth, causing deviations from the plan. In some cases, these events may be dealtwith locally; that is, they lie within the scope of a single supply-chain function. In othercases, the problem cannot be “locally contained” and modifications across many functionsare required. Consequently, the supply-chain management system must coordinate the revi-sion of plans or schedules across supply-chain functions. The ability to manage the tacticaland operational levels of the supply chain so that the timely dissemination of information,accurate coordination of decisions, and management of actions among people and sys-tems is achieved ultimately determines the efficient, coordinated achievement of enterprisegoals.166 MARK S. FOX ET AL.In recent years, a new software architecture for managing the supply chain at the tacticaland operational levels has emerged. It views the supply chain as composed of a set ofintelligent (software) agents, each responsible for one or more activities in the supply chainand each interacting with other agents in planning and executing their responsibilities.An agent is an autonomous, goal-oriented software process that operates asynchronously,communicating and coordinating with other agents as needed.This paper investigates issues and solutions in the construction of such a software ar-chitecture. Section 2 reviews a number of issues and presents a list of requirements foragent-oriented architectures for the supply chain. Section 3 presents our Agent BuildingShell, which provides generic, reusable, and guaranteed components for some of the re-quired elements of the architecture. Section 4 shows how the components provided by theshell have been used to construct nontrivial agent-oriented supply chain architectures andevaluates the solutions advanced. We end with concluding remarks and future work hints.2. Design issues for a multiagent supply-chain systemWhich are the most important issues to address, to effectively build an agent-based soft-ware architecture for the supply chain? The first issue we face is deciding how supply-chainactivities should be distributed across the agents. Existing decompositions, as found inMRP (Material Resource Planning) systems, arose out of organizational constraints, legacysystems, and limitations on algorithms. For example, the distinction between master pro-duction scheduling and detailed scheduling is due primarily to algorithm limitations. Themerging of these two functions and the inclusion of some activities found in inventory man-agement and activity planning becomes possible with the availability of more sophisticatedplanning and scheduling algorithms. With more sophisticated planning, scheduling, andcoordination methods, we can build better decompositions, improving the overall qualityof supply-chain management. For illustration, here is a typical agent decomposition that weuse in our work:• Order acquisition agent. This agent is responsible for acquiring orders from customers;negotiating with customers about prices, due dates, and the like; and handling customerrequests for modifying or canceling their orders. When a customer order is changed, thatchange is communicated to the logistics agent. When plans violate constraints imposedby the customer (such as due date violation), the order acquisition agent negotiates withthe customer and the logistics agent for a feasible plan.• Logistics agent. This agent is responsible for coordinating the plants, suppliers, anddistribution centers in the enterprise domain to achieve the best possible results in termsof the goals of the supply chain, including on-time delivery, cost minimization, and soforth. It manages the movement of products or materials across the supply chain fromthe supplier of raw materials to the customer of finished goods.• Transportation agent. This agent is responsible for the assignment and scheduling oftransportation resources to satisfy interplant movement requests specified


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VCU INFO 658 - Agent-Oriented Supply-Chain Management

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