A Novel Supplier-Managed Inventory Order Assignment Platform Enabled by Blockchain Technology

Abstract

Supplier Managed Inventory (SMI) can be considered as an enabler for supply chain coordinating in which the supplier takes over the customer's inventory to optimize the supply chain. However, successful implementation of SMI is centered on high level of trust, accurate data transfer, and efficient interaction between parties. This requires the sharing of information through supply chain stakeholders which face resistance and challenges due to the fear that this information is revealed to its competitors and transparency of data. This paper has investigated the application of Blockchain technology and its potential for successful SMI implementation. The paper has proposed a Blockchain framework for the coordination of suppliers and customers. The framework includes a mathematical model for multiple supplier customer order fulfillment which is embedded in blockchain framework. The paper has demonstrated case studies to evaluate the performance of the proposed model with literature discussing the details of its blockchain framework.INDEX TERMS Supplier managed inventory (SMI), Blockchain technology (BC), Order assignment, Supply chain management (SCM)