A Simulation-based Optimization Model for Integration of Cash and Material-Flow Planning within a Supply Chain

The study aims to use simulation-based optimization methodology for modeling Automative-wheel rig supply chain. Simulation-based optimization approach consists of both simulation and optimization models that transform information repetitively until stop criterion is fulfilled. Simulation technique is based on system dynamics and optimization comprised of multi objective optimization with the aim of minimizing cost, minimizing cash conversion cycle as well as maximizing inventory turnover for two members of supply chain which is solved by genetics algorithm. Powersim Studio 10 is utilized to combine simulation and optimization models. After using the methodology and acquiring optimal solutions, decision maker chooses the optimal solution based on priority discussed for members.  The study claims optimal solutions generated by simulation-based optimization are superior in comparison with scenario making in system dynamics model.