Semiconductor Supply Chain Planning With Decisions of Decoupling Point and VMI Scenario

Under the trend of globalization, rapid advancement of Information Technology, shorter electronic product life cycles, and the rise of consumer consciousness, there is fiercer market competition in most industries, especially in the semiconductor industry. Effective supply chain management is a critical successful factor for enterprises to survive in such a competitive market since it can help enterprises in reducing cost and improving operational efficiency. For an integrated device manufacturer (IDM) in the semiconductor industry, due to its complex network, strategic alliance among partners as well as supply chain integration are efficient approaches to enhance competitiveness and make more profit. In this paper, we develop an integrated model of supply chain planning for IDMs. The integrated model is developed to help decision makers determine the production quantities and delivery quantities at various locations, the decoupling point of a push-pull supply chain, the inventory buffer at the boundary and the vendor managed inventory scenario. The semiconductor manufacturing characteristics including binning, substitution, and yield are taken into consideration in the formulated model. In addition, the model is developed for a semiconductor supply chain characterized by multiple stages, plants, products, and product grades.