Supply Chain Cost Optimization

Categories: Optimisation
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About Course

This course is designed to provide students with a comprehensive understanding of supply chain cost optimization, including various techniques to reduce supply chain costs while maintaining or improving operational efficiency. Students will learn how to use various tools and methodologies to analyze and optimize supply chain costs, such as supply chain modeling, network optimization, inventory management, and transportation optimization. The course will cover key concepts in supply chain cost optimization, such as cost drivers, trade-offs, and performance metrics.

Course Outline:

  1. Introduction to Supply Chain Cost Optimization
  • Definition of Supply Chain Cost Optimization
  • Key Drivers and Trends in Supply Chain Cost Optimization
  • The Role of Cost Optimization in Business Strategy
  1. Cost Drivers and Trade-Offs in Supply Chain
  • Key Cost Drivers in Supply Chain
  • Trade-Offs between Cost and Service Level
  • Cost Allocation and Profitability Analysis
  1. Supply Chain Modeling and Optimization
  • Supply Chain Network Design and Optimization
  • Facility Location and Capacity Planning
  • Multi-Objective Optimization and Sensitivity Analysis
  1. Inventory Management and Optimization
  • Inventory Planning and Control
  • Inventory Cost Analysis and Optimization
  • Safety Stock and Service Level Analysis
  1. Transportation Management and Optimization
  • Transportation Planning and Execution
  • Freight Cost Analysis and Optimization
  • Carrier Selection and Routing Optimization
  1. Performance Metrics and Continuous Improvement
  • Key Performance Indicators (KPIs) for Cost Optimization
  • Lean Six Sigma and Process Improvement
  • Sustainability and Green Supply Chain Cost Optimization


  • Basic knowledge of supply chain management concepts and principles
  • Familiarity with Excel or other data analysis tools

Recommended Textbook:

  • “Supply Chain Management: Strategy, Planning, and Operation” by Sunil Chopra and Peter Meindl.


  • Midterm Exam (30%)
  • Final Exam (40%)
  • Group Project (30%)

Note: The course syllabus and assessment methods are subject to change based on instructor’s discretion.

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What Will You Learn?

  • 1. Understand the role of supply chain cost optimization in business strategy and operations.
  • 2. Analyze and identify cost drivers in the supply chain and develop trade-offs between cost and service level.
  • 3. Apply supply chain modeling and optimization techniques, including network design, facility location, capacity planning, and multi-objective optimization.
  • 4. Apply inventory management and optimization techniques, including inventory planning and control, cost analysis, safety stock, and service level analysis.
  • 5. Apply transportation management and optimization techniques, including transportation planning and execution, freight cost analysis, carrier selection, and routing optimization.
  • 6. Develop and monitor key performance indicators (KPIs) for supply chain cost optimization, and implement continuous improvement methodologies such as Lean Six Sigma and sustainability practices.

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