Sharing Production Progress Information in Supply Chains

Many companies are interested in sharing production progress information with their supply chain partners. While some conceptual studies have addressed the importance of sharing production progress information in supply chains, the literature does not show how to quantify the benefits of sharing production progress information. This paper uses a simulation model to estimate the expected value of information. Our results show that (1) the expected supply chain system cost saved from sharing progress information is substantial and increases as the information sharing frequency increases, (2) the percentage of cost saved increases as the number of suppliers sharing information increases, (3) the expected value of sharing progress information increases as the uncertainty in suppliers´ production lead times decreases, (4) sharing production progress information provides more cost savings than sharing only the production starting time and lead time distribution, and (5) allowing suppliers to synchronize their deliveries when suppliers´ production progress information is shared results in significantly lower supply chain system cost than using fixed order due dates.