A System Dynamics Model to Evaluate the LARG Supply Chain Elements in the Automotive Industry

Document Type : Research Article

Authors

• Nima Saberifard
• Mahdi Homayounfar
• Mehdi Fadaei
• Mohammad Taleghani

Department of Industrial Management, Rasht Branch, Islamic Azad University, Rasht, Iran.

10.22067/jstinp.2024.87456.1098

Abstract

The automotive industry is highly competitive, requiring robust supply chains to secure a strategic advantage. This study uses the Lean, Agile, Resilient, and Green (LARG) paradigms to evaluate supply chain performance in the automotive sector. This article developed a comprehensive system dynamics model to analyze these paradigms, incorporating key elements and their interactions within the supply chain. The model simulated eight scenarios to assess the impact of different strategies on supply chain performance. Research findings highlight that enhancing supply chain efficiency leads to the most significant increase in income, underscoring the importance of optimizing processes and reducing costs. Improving process flexibility emerged as the second most impactful strategy, enabling quicker adaptation to market changes and customer demands. Optimizing the flow of value and added value created also proved crucial, streamlining processes and reducing waste to enhance profitability. This research provides actionable insights for automotive industry stakeholders. Companies can substantially improve supply chain performance by focusing on efficiency, flexibility, and value flow. The study emphasizes the practical application of the LARG paradigms, offering a holistic framework for supply chain management in the automotive sector. In summary, the research system dynamics model demonstrates the critical role of LARG elements in driving supply chain success. This approach enables automotive companies to strategically enhance their supply chains, ensuring competitiveness in a dynamic market environment. The results offer valuable guidance for implementing effective supply chain strategies, paving the way for sustained profitability and growth.

Keywords

• Supply chain
• System dynamics, Automotive industry, LARG paradigms

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