Managing On-Time Delivery in Engineering-to-Order Supply Chain with Buffer Time Optimization

Engineering-To-Order (ETO) is a production approach where manufacturers design, engineer, and assemble a unique product based on specific customer requirements. In this type of operation, manufacturers are faced with many uncertainties in the supply chain and design process, which often lead to unreliable delivery time and high total cost. This paper proposes a project management approach to cope with the uncertainties in the ETO supply chain by allocating some buffer times within the supply chain network. Particle Swarm Optimization (PSO) is used to find the optimal configuration of the buffer time within the supply chain. The result shows that the buffer time optimization method can help manufacturers to keep a high level of on-time delivery performance (95%) while keeping the total cost minimum.