Positioning The Decoupling Point Along A Supply Chain: A Case Study

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Positioning the decoupling point along a supply chain: a case study
Article in International Journal of Productivity and Quality Management · January 2017

DOI: 10.1504/IJPQM.2017.087302
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Int. J. Productivity and Quality Management, Vol. 22, No. 3, 2017 309
Positioning the decoupling point along a supply

chain: a case study
Hande Erdogan Aktan*

Department of Management Information Systems,
Faculty of Applied Sciences,
Akdeniz University,
Yeşilbayır, Antalya, Turkey
Email: handeaktan@akdeniz.edu.tr
*Corresponding author
Gokhan Akyuz
Department of Business,
Faculty of Economics and Administrative Sciences,
Akdeniz University,
Campus, Antalya, Turkey
Email: akyuz@akdeniz.edu.tr
Abstract: In today’s business world where the supply chains compete with one
another, companies need to match their products with different supply chain
(SC) strategies in order to increase their market shares, deliver the mass
customised products that their customers demand at the right time and adapt to
the rapid changes in the market. This paper contributes to the literature by
demonstrating how products and supply chain strategies matching can be
matched and how the decoupling point can be positioned along a leagile supply
chain. To this end, a case study was conducted in a furniture components
manufacturing company. First the products of the company were classified and
matched with lean, agile or leagile supply chain strategies. With a view to
determining the decoupling point of a leagile strategy, fuzzy Dematel method
was applied to identify the relationships between the criteria, Dematel-based
ANP (DANP) was applied to determine the weight of the criteria, fuzzy
TOPSIS was applied to identify the best decoupling point (DP) and 0–1 goal
programming (ZOGP) method was applied to identify the optimum alternative
solution set under the constraints. This study aims to present a road map for the
decision makers by using a case study as an example.
Keywords: lean; agile; leagile; decoupling point; supply chain strategy;

product family; Dematel; fuzzy; Dematel with ANP; DANP; TOPSIS; 0–1 goal
programming; ZOGP.
Reference to this paper should be made as follows: Aktan, H.E. and Akyuz, G.
(2017) ‘Positioning the decoupling point along a supply chain: a case study’,
Int. J. Productivity and Quality Management, Vol. 22, No. 3, pp.309–339.
Biographical notes: Hande Erdogan Aktan is an Assistant Professor in the
Department of Management Information Sciences in the Faculty of Applied
Sciences, Akdeniz University, Turkey. She has a MS in Industrial Engineering.
She is interested in operations management, decision making, production
systems, operations research, supply chain management and performance
management.
Copyright © 2017 Inderscience Enterprises Ltd.

310 H.E. Aktan and G. Akyuz
Gokhan Akyuz received his Master’s degree in Business Administration from

Akdeniz University, Antalya, Turkey, in 2001 and PhD degree in Business
Administration from the Akdeniz University, Antalya, Turkey, in 2006.
Currently, he is an Associate Professor in the Department of Business, Akdeniz
University, Turkey. He is interested in operations management, operations
research, mathematical programming, quality management systems and
performance measurement.
This paper is a revised and expanded version of a paper entitled ‘Determination

of the weights of criteria affecting the position of a leagile supply chain's
decoupling point’ presented at 5th World Conference on Business, Economics
and Management, BEM 2016, Antalya, Turkey, 12–14 May 2016.
1 Introduction
Globalised competition shape the markets due to several factors such as increased
product diversity, shorter product life cycles, new production technologies and
customers’ demand for low-priced but at the same time customised products. In such an
environment, enterprises willing to maintain their competitiveness should be well
prepared for the unexpected changes. Competition has now switched from company level
to the supply chain level in today’s modern business world as stated by Christopher and
Towill in 2002. Effective supply chain management is of great importance to maintain
competitive advantage and improve organisational performance (Sangari et al., 2015).
Since the ultimate customers in the market determine the success of a supply chain,
companies need to be highly sensitive to respond to the demands of their customers and
satisfy their needs in a timely, accurate and rapid manner by using an effective supply
chain strategy that is appropriate for the products in order to maintain their
competitiveness against their competitors and be better than them in the market. It is
imperative to satisfy the customers and understand the market for a successful supply
chain strategy. A supply chain strategy that is developed taking account of the constraints
and needs of the market can meet the requirements of both the customers and the supply
chain (Towill and Christopher, 2002).
The conventional approach that applies one-size-fits-all supply chain strategy to each
and every product is not satisfactory anymore. Instead, other methods in which different
supply chain strategies can be used simultaneously and the most appropriate supply chain
strategy should be matched with the characteristics of the products have been developed.
In general, lean and agile supply chain strategies have been proposed as the main types of
supply chain strategies in the literature (Mason-Jones et al., 2000a, 2000b; Christopher
and Towill, 2001; Hallgren and Olhager, 2009; Vinodh et al., 2009; Galankashi and
Helmi, 2016).
The goal of the lean strategy is to reduce the costs and improve quality while agile
strategy focuses on adapting to the unexpected changes in the market (Banerjee and
Mukhopadhyay, 2016). Applying the lean only or agile strategy only in a supply chain is
a rare practice. Rather than that, leagile strategies that combine both strategies in supply
chains based on the market knowledge in harmony with the structure of the market,
product or processes with the help of a DP (Ambe, 2010; Bezuidenhout, 2016;
Galankashi and Helmi, 2016).
Positioning the decoupling point along a supply chain 311
Enterprises should combine the lean and agile strategies in order to survive and
maintain their competitiveness. Quality, lead time, cost and service are the essential
elements of competition for all enterprises. On the other hand, there may be several
reasons that make them lean or agile. Cost-oriented enterprises prefer lean strategies
while service-oriented ones may seek for agility. From a supply chain perspective, the
lean approach aims at reducing the physical costs such as production, distribution and
storage costs, whereas agility focuses on marketability costs such as obsolescence and
stock-out costs (Christopher and Towill, 2001; Gaudenzi and Christopher, 2016). The
concept of leagility was proposed in order to overcome this dilemma and build a
relationship between agility, low-cost production and effective supply chain (Gaudenzi
and Christopher, 2016).
The purpose of applying both strategies in a supply chain is to manage the processes
as efficiently as possible using a lean and forecast-based structure in the upstream of the
chain while on the other hand focusing on agility and make-to-order approach in the
downstream. The goal is to allow the processes to be as flexible as possible (van Donk
and van Doorne, 2016).
The lean and agile processes in the leagility are distinguished with DP that plays an
important role in reducing the production costs. In leagile strategies, it is very important
to determine the position of this point along a supply chain as it distinguishes between
forecasts and precise customer orders. If companies prefer not using a one-size-fits-all
strategy in order to maintain a competitive edge in the market, there are two main issues
they should decide. One of important managerial decision for the companies
manufacturing products with different characteristics is to choose between the lean, agile
or leagile strategy options. After product-strategy matching, they should determine the
location of the DP for each strategy, especially the leagile strategy.
This study makes significant contributions to the literature by examining how
different supply chain strategies should be managed according to product features and
how the position of a DP along a supply chain should be determined. To this end, a case
study was conducted at a furniture components manufacturing company with a view to
demonstrate how that company matched their products with different supply chain
strategies positioned the DP for a specific product group in line with the leagile strategy.
In order to reveal these issues, this paper proposes a methodology that aims at
enabling the determination of a supply chain strategy for different products. Section 2 of
the paper presents a review of the literature with a view to matching the products with
supply chain strategies. Section 3 presents an evaluation of the lean, agile and leagile
supply chain strategies, information about the decoupling point and an analysis of how
important it is to position this point alongside the chain in line with the strategies. The
steps to implement the proposed model in the case study and the result obtained are
presented in Section 4, while an overall assessment is presented in the conclusion.
2 Literature review on matching products with supply chain strategies
Fisher (1997) laid the foundations for later studies on matching the products and product
characteristics with the right supply chain strategies. Fisher focused on product demands
in order to identify the supply chain strategies, argued that different supply chain
strategies were needed for different types of products, divided the products into
functional or innovative product categories and analysed product-supply chain matching
from the perspective of order winning (OW) and order qualifying (OQ) characteristics.
Fisher (1997) matched the functional products with the efficient supply chain while
matching the innovative products with the responsive supply chain. Many authors in the
literature discussed, tested and further developed Fisher’s (1997) model (Lamming et al.,
2000; Li and O’Brien, 2001; Wong et al., 2006; Vonderembse et al., 2006; Selldin and
Olhager, 2007; Lo and Power, 2010; Harris et al., 2010).
After Fisher’s publication, many researchers published their papers on matching
products with different supply chain strategies (Lee, 2002; Mason-Jones et al., 2000a;
Christopher and Towill, 2001; Huang, 2002; Stratton and Warburton, 2003; Cigolini
et al., 2004; Christopher et al. 2006; Wright, 2013). Lee (2002) underlined that
‘uncertainty’ should not be neglected in matching a product with the right supply chain
and asserted that uncertainties on both the demand side and the supply side might
influence that decision. Lee (2002) matched the functional product that had a low demand
and supply uncertainty with the efficient supply chains. Although the author did not use
that phrase, the supply chain strategy he referred to was the lean supply chain strategy.
As an additional piece of information on this matter, the efficient and responsive supply
chains proposed in Fisher’s (1997) model were redefined as lean and agile strategies by
many researchers, respectively (Mason-Jones et al., 2000a; Christopher and Towill, 2001;
Stratton and Warburton, 2003). Lee (2002) matched the innovative products that had a
high demand uncertainty, but low supply uncertainty with the responsive supply chain
and stated that this supply chain would enable one to respond rapidly and be flexible to
different and diversified demands of the customers. He also matched the innovative
products that had high demand and supply uncertainties with the agile supply chain while
finally matching the functional products that had a low demand uncertainty, but high
supply uncertainty with the risk-hedging supply chain strategy (Lee, 2002).
Huang et al. (2002) focused on matching the functional, innovative or hybrid products
with the supply chain strategies. They reported that the demand for the functional
products, also referred to as standard products, usually remained constant and could be
forecasted accurately and matched these products with the lean supply chain. On the
other hand, they proposed that an agile supply chain would be optimal for the innovative
products that were developed to get a share in new markets or adapted to the changing
customer requirements, had uncertain demand and life cycles at the introduction or
growth stages. They defined the hybrid products as products that consisted of either
different combinations of functional products or a mix of functional and innovative
components and matched the hybrid products with leagile supply chain strategy.
Cigolini et al. (2004) further developed Fisher’s (1997) model in their study, used the
variable vs. fixed cost ratio, manufacturing flexibility, elasticity of demand to price and
main competitive weapon criteria and matched the products with efficient, quick and lean
supply chain strategies. They thought that an efficient supply chain would be more
appropriately matched with the functional products that were often sold in high volumes.
They matched the quick supply chain strategy that was the equivalent of Fisher’s (1997)
responsive supply chain strategy with the products for which it was very difficult to
forecast the customers’ demands. Finally, they matched the products such as cars and
white goods that had such intermediate characteristics as not only the product price or
innovativeness, but also price, quality, uniqueness and customer satisfaction with the lean
supply chain strategy.
Christopher et al. (2006) studied a three dimensional classification for the choice of a
supply chain strategy. They developed four comprehensive supply chain strategies
according to the combination of demand and supply conditions of each product. Using
the product (standard or special), demand (stable or volatile), replenishment lead time
(short or long) dimensions in their model and defined functional (standard) product as a
product that had a stable demand, long lead time, no or little customisation; and defined
special product as a low-volume product with highly variable demand or with short lead
time or can be highly customised. Assuming that the demand for standard products could
be forecasted more easily, the authors preferred using only the demand predictability and
lead time aspects in their further study. They proposed the lean strategy for the products
with short lead time and predictable demand in order to replenish the diminishing
products; agile strategy for the products with short lead time, but unpredictable demand;
lean strategy for the products with long lead time and predictable demand; and finally
leagile strategy for the products with long lead time, but unpredictable demand in order to
maintain the product in its general form and complete the remaining processes such as
assembly, distribution and etc. once the actual order is placed. Wright (2013), however,
explored the factors influencing the Romanian manufacturers’ choice of supply chain
strategies and if product-strategy matching had an impact on their performance. He
concluded that producers of innovative products were more likely to choose the
responsive supply chain. He also found that large-scale companies tended to use that
strategy. Furthermore, the author also added that companies might not need to match
their products with an appropriate supply chain in order to improve their performance.
3 Lean, agile and leagile supply chain strategies
In those markets where competition is fierce, companies have to build their supply chain
strategies on lean and agile principles in order to be successful. Lean supply chains are
mainly preferred for standard products and focus on reducing waste, continuous
improvement and maximum utilisation. An agile supply chain, however, is used in cases
when there is a need to be able to respond to the demands of the customers in an
environment with demand fluctuations, meet the demand for prime quality products or
services and tackle with obsolescence or short life of products. Nevertheless, only a few
supply chains use the lean or agile strategies alone. It is now possible to use different
strategies in different parts of a supply chain thanks to the leagile supply chain strategy
proposed in recent years. With this new strategy, the requirement of a supply chain to be
lean only or agile only does not prevail any more. For example, a lean supply chain can
be used for button production, while the agile strategy can be used for the production of
fashion clothes on which the buttons are used (Bezuidenhout, 2016).
3.1 Lean supply chain strategy

Lean thinking that aims at ensuring one piece flow throughout a system and was first
applied by Toyota has been widely acknowledged by several sectors since its motto is
continuous improvement (Noori, 2015). The goal of lean thinking (Womack and Jones,
1996) is to reduce or eliminate all kinds of wastes to survive in a competitive market
(Muruganantham et al., 2014). Enterprises know that both their processes will be
improved and the cost of their products and services will be reduced when lean principles
are applied (Chiarini, 2014). These major principles include the identification of the
value, mapping the value stream, creation of the flow, responding to pull and pursuing
perfection. From a supply chain perspective, lean thinking is defined as a value stream
that could smooth production and eliminate all wastes including time.
Quality, cost, flexibility, delivery and reliability are the basic values important for a
supply chain. Lean principles can be applied to all actors of a supply chain in order to
eliminate the losses, create value and increase flexibility along the chain (Kumar et al.,
2015).
A lean supply chain that focuses on waste and value in the whole chain consists of
product flow, customer demand, information flow and customer/supplier relation
processes. Product flow refers to the activity that adds value to a product or service in the
time-span from the procurement of raw materials from the suppliers to the delivery of
products to the customers. Information flow means the flow of data that supports the
creation of value, and customer demand refers to the output of the supply chain. Finally,
the customer-supplier relationship that influences the product and service movement is
also required for the successful implementation of a lean supply chain (Mohammed et al.,
2008). The sub-systems of a lean supply chain that aims at producing the right service or
right product at the right price and in the right volume by using the right material, with
the right quality, at the right time and in the right place include lean suppliers, lean
purchasing, lean storage, lean logistics and customers (Amir, 2011). The lean supply
chain that is unable to adapt easily to the changing market conditions and thus better at
coping with the constant demands can fulfill its goals through eliminating the wastes;
reducing the inventory, lot sizes and number of suppliers; assessing the suppliers on the
basis of their quality and delivery performance; establishing long-termed relations with
the suppliers; eliminating the paper works and etc. In markets where the demand remains
constant and thus is predictable and the product diversity is low, lean principles are
applied efficiently (Hilletofth, 2009). Lean supply chain is often used for ‘functional’
products that meet the basic needs. It is fairly easy to predict the demands for such
products and the unavailability of a functional product in the inventory can be negligible
(Huang et al., 2002).
When the supply chain strategy is lean, production and distribution decisions are
based on long-term forecasts. In general, the manufacturers forecast the demands taking
account of the orders received from the storage of the retailer. In this type of supply
chains, it takes a long time to adapt to the changing market conditions. Furthermore, the
products might also become obsolete or deteriorate due to the inability to meet the
demands and the lack of demand for the products according to the forecasts. In these
supply chains where the bullwhip effect is observed, resources cannot be used effectively
because it is challenging to plan and manage (Simchi-Levi et al., 2003).
3.2 Agile supply chain strategy

The concept of ‘agility’ that was first proposed in the 21st century Manufacturing
Enterprise Strategy Report is defined as the ability of the enterprises to be successful in
an environment where the demands cannot be predicted and customer demands change
constantly (Tolf et al., 2015). Focusing on cost-reduction, flexibility and internal
solutions, the lean supply chain strategy has failed to understand the current and future
market requirements, adapt to these changes quickly and handle the product diversity
(Gunasekaran, 1999; Huang et al., 2002; Rahimnia et al., 2009; Naim and Gosling, 2011).
Therefore, companies have recognised that they could not survive in competition by
being lean only, as a result of which the concept of agile has emerged (Christopher and
Towill, 2000).
An agile supply chain is a strategy that is capable of utilising of profitable
opportunities in a variable market by applying the market knowledge and virtual
cooperation (Naylor et al., 1999). An agile supply chain aims at providing the products or
services demanded and designed by the customers in dynamic and aggressive markets by
means of agility which refers to the ability to respond quickly to unpredictable market
changes (Huang et al., 2002; Gaudenzi and Christopher, 2016). An agile supply chain is
basically characterised by responsiveness to the market, integration of the processes,
network-orientedness and establishment of virtual cooperation.
Agility of a supply chain incorporates all elements of the chain rapidly into the
network and adapts to the dynamism of and changes in the demands (Ismail and Sharifi,
2006). Focusing on developing solutions for unpredictable changes in the market and
taking advantage of these changes, an agile supply chain aims to ensure faster delivery
and achieve lead time flexibility. An agile supply chain dealing with organisational
matters at strategic level and people develops new technologies and methods, uses
information systems/technologies and electronic data interchange (EDI) technologies,
integrate all business processes, improves innovations in the entire company, forms
virtual organisations and production based on customer designed orders (Huang et al.,
2002). The idea of agility in supply chain management is centred around the concept of
‘responsiveness’.
In this type of a supply chain, production and distribution are derived by the actual
demands because both production and distribution are associated with the actual
customer demands rather than the demand forecasts. With this strategy, the company
does not keep inventory, but only manufactures the products that are ordered. In these
systems, the customers’ demands are communicated to the other participants in the chain
via rapid information flow. These systems help decreasing lead times and reducing the
inventory levels.
3.3 Leagile supply chain strategy

In order to cope with the pressure of a wide range of products with high quality in the
market, the concept of ‘leagility’ that combines lean and agile strategies was introduced
for the companies (Lemieux et al., 2015). The common goal of the lean and agile supply
chain strategies is to meet the customers’ demands at the lowest cost possible (Qi et al.,
2007). Although the prerequisite for agility is to be lean, the desire to use low cost and
high flexibility simultaneously might result in a contradiction. Cost reduction and
elimination of losses that form the essence of lean strategy are short-term strategies in
competition; however, agile strategy provides a long-term competitive advantage to the
companies in handling the uncertainties and manufacturing a wide variety of customised
products at mass production costs. Companies prefer lean strategy for short-term cost
advantages, but need to improve their production capabilities to retain their customers
who oriented towards the niche markets (Prince and Kay, 2003). The important question
at this point is whether both strategies can be used simultaneously within a supply chain.
Naylor et al. (1999) argued that these two paradigms that were different from one another
could be used in leagile strategy. In this one, strategies are not used together against one
another. When organisations recognised that merging lean and agile strategies will bring
a great advantage and superiority, leagility strategy emerged (Gaudenzi and Christopher,
2016). Many researchers have explored the leagile strategy in which lean and agile
strategies are used simultaneously (Naylor et al., 1999; Childerhouse and Towill, 2000;
Mason-Jones et al., 2000a; Christopher and Towill, 2000; Huang et al., 2002; Stratton
and Warburton, 2003; Simchi-Levi et al., 2003).
Christopher and Towill (2001) grouped the leagile supply chain approach that can be
applied according to the different market and business environment conditions under
Pareto, separation of base/surge demand and DP approach. DP approach was chosen for
the company where we conducted our study because it adopted the modular production
approach, maintained buffer inventory and had a potential to postpone the production.
The purpose of this approach is to maintain the inventory in the modular or generic form
and manufacture the products once the customer order is received (Christopher and
Towill, 2001). This approach is based on the postponement principle.
In summary, the postponement strategy that refers to delaying the final form or
movement of a product as long as possible is an organisational strategy in which the
production activities are postponed until the orders are placed rather than producing
based on the forecasts of customer orders and manufacturing the products at the best cost
through customisation only when the orders are received (Van Hoek, 2001; Ferreira and
Alcantara-Chicarelli, 2016). The postponement strategy aims at reducing the risks related
to the product diversity through the joint utilisation of materials and components and
designing the production and distribution processes in a way to postpone the
differentiation point (Van Hoek, 2000; Shao and Ji, 2008).
DP, which is the connection point between make-to-stock and make-to order portion
of a system and has become popular in 1990s, identifies the last point in a value chain
where a product is linked to a specific customer order, product features are frozen and
most importantly the inventory is maintained (Olhager, 2010; Guven-Uslu et al., 2014).
Also known as order penetration point, DP is the point that distinguishes manufacturing
within a product stream based on forecasts from manufacturing based on customer orders
(Wikner and Rudberg, 2005). In other words, DP is a stage where a specific product is
linked up to a specific customer order in a production value chain. DP distinguishes the
customer-driven manufacturing from forecast-driven management (Van Kampen and Van
Donk, 2014).
The point where the product is customised, namely differentiated in a supply chain, in
other words the point until which the production is postponed is described as DP. This
point distinguishes make-to-stock from make-to-order. While all the activities before DP
in the chain are standard activities, those activities after DP are customised and carried
out according to the specific customer order (Ferreira and Alcantara-Chicarelli, 2016).
In a supply chain, there are two DPs: one from the sales point to the supplier and the
other from the raw material to the end user (Mason-Jones and Towill, 1999; Christopher
and Towill, 2000). The former represents the material DP, that is the closest possible
point to the customer within a supply chain. At this point, the inventory is maintained in
the generic form. The latter, however, is the information DP that must be positioned at
the very beginning of the supply chain as much as possible. The bullwhip effect that
might occur in a supply chain can be reduced or eliminated by managing these two DPs
well (Qi et al., 2007). The criteria influencing the position of DP are presented in Table 1.
Table 1 Criteria influencing the DP position
Market related Product related Process related

Delivery reliability Holding cost Production lead time
Delivery time Backorder cost Process flexibility
Predictability of demand Risk of obsolescence Human resources flexibility
Order size Modular product design Number of planning points
Order frequency Product structure Position of the bottleneck
Product range Customisation opportunities Equipment flexibility
Seasonal demand Product cost
Product customisation Product quality
requirement
Supplier commitment
Pricing policy
Source: Van Donk (2000, 2001), Olhager (2003), Rafiei and Rabbani (2011),
Zaerpour et al. (2009), Hemmati and Rabbani (2010).
4 Applied methodology
A case study was conducted under this research in order to apply the methodology the
steps are presented below. This study was performed in a company that operated in the
furniture industry and manufactured profile, post forming panels, panels, wainscot, wood
composite decks/benches, doors and sub-groups of these products needed in that industry.
Case study, is used in a research in order to explain or explore the events or methods as if
they really occurred or were applied (Vlachos, 2015). It aims at enabling the decision
makers to solve their problems. This company was selected for the study because of its
wide range of different products. Moreover, the main reason for this choice was the
interest of the top managers in the relationship between strategies and products. They all
believed that the output of this study would contribute to their business models. The
objective of the case study was to determine whether the leagile strategy could be applied
within this organisation and, if so, how the DP can be positioned along a chain.
Ultimately, in this study, the company’s products were matched with the lean, agile
and leagile strategies and a model was proposed to identify the optimal position of DPs
for such strategies. With this methodology, different business models for different
products were proposed to the decision makers.
The model was developed on the basis of Rafiei and Rabbani’s (2011) model. The
11 methodological steps taken in this study are presented in Figure 2 and are explained
below.
Step 1: Data collection and compilation

At this step, the raw data collected from the company were compiled and adapted to the
study. Calculations were made for 10.346 products manufactured by the company,
including the colour varieties. 76.600 orders received in the previous nine months were
analysed and the data on the date of first entry of orders into the system, first revision
date and final delivery date were used. In total 3.498 products were identified in harmony
with the business structure and in accordance with the remarks of the expert group
formed at the production planning department. The sales volume, number of orders,
delivery time, product characteristics, production time, in stock waiting time to total time
ratio, production to delivery lead time ratio (P/D ratio) and the ratio of in stock during
delivery process were calculated. Furthermore, information regarding the stock of
finished products and volume of orders received, average sales of products, sales
frequency percentage, and monthly sales distribution was compiled.
Figure 2 Methodology of the study
Step 2: Classification of products

Sales volume, delivery time, P/D ratio, the ratio of in stock during delivery process,
product range, stock status of the products at the time of the order placement and demand
type were agreed to be used as the criteria to classify the products as a result of the
assessments made together with the expert group. These criteria gave an idea of the sales
volume of each product, its delivery time, current DP position, ratio of in stock during
delivery process, its supply from the stock upon an instantaneous order and the demand
type. Following this stage, it was possible to decide whether the product was functional
or innovative. First, sales volume was analysed. In the light of the fact that the products
with high sales volume were manufactured to stock while the products with low sales
volume were manufactured by make-to-order strategy and low or high sales volume
played a very important role in determining whether a product was innovative or
functional, the study was further developed on the basis of this criterion.
Step 3: Matching products with supply chain strategies

As a result of the product classification performed by using the abovementioned criteria,
3.377 products in total were identified as innovative products. Innovative products were
matched with the agile supply chain strategy while the first workstation was identified as
the DP for these products. MTO or DTO strategies were deemed to be appropriate for
manufacturing these products. Only one product was identified as a functional product.
That product was matched with the lean supply chain while the last workstation was
identified as the DP for that product which was associated with the MTS strategy (Rafiei
and Rabbani, 2011). In total 3.498 products of the company were analysed, while 3.426
remained for analysis after the exclusion of those products that led to deviations or failed
to satisfy certain criteria. The breakdown of these products is presented in Table 2.
Table 2 Product type-supply chain strategies and DP locations
Product type Quantity Supply chain strategy DP location

Innovative 3.377 Agile MTO/DTO
Functional 1 Lean MTS
Other 48 - -
As a result of this analysis, 48 products were identified neither innovative nor functional
but covered by another group. These products formed product families at a later stage,
which were classified into functional, innovative or hybrid product family groups.
Step 4: Clustering the unmatched products under product families

At the clustering stage, the method proposed by Galan et al. (2007) was developed in line
with the structure of the study and of the company. The modularity, commonality,
reusability and demand matrixes of the method were used in this study without any
modification; while the technological compatibility and market compatibility matrixes
were designed with a different method. The information on the production route was
taken into account for the technological compatibility while the information on customers
was used for the market compatibility. At this stage; six different matrixes that were
developed included the product demand, market compatibility, technological
compatibility, modularity, commonality and reusability. The weight of these
characteristics in the product families that were harmonised with the company’s structure
jointly with the expert group was calculated by using the fuzzy AHP model rather than
the classic AHP as proposed by Galan et al. (2007). For the fuzzy AHP, Chang’s (1996)
extent analysis model was applied and normalised criteria weights (W) were calculated
(Table 3).
Table 3 Criteria weights
Product Market Technological

Modularity Commonality Reusability
demand compatibility compatibility
W 0.18 0.15 0.13 0.21 0.17 0.16
In order to reduce the criteria matrixes used to form the product families into a single
matrix, the value in each product’s matrix was multiplied by the weight of the relevant
criterion and these multiplied values were added up; as a result, six matrixes were
reduced to a single matrix while the average-linkage clustering algorithm was used.
Step 5: Classification of product families

The DMs chose the group with 17 product families because the commonality was
adequate, the product families formed were compatible with the grouping logic of the
company and the results were applicable. The commonality of the group with 17 product
families was found to be 0.695, while its efficiency was 4.09%. At this stage when 17
product families were obtained, seven product families (19 products) were assigned to the
‘innovative’ family, while one product family (one product) was assigned to the
‘functional’ product family. The remaining nine product families containing 28 products
were identified to be hybrid product family, which was the subject-matter of this study.
When each of the product families is examined with respect to the products, it was found
that the demands for each product family, the customers they were delivered to, their bill
of materials and production routes were all similar.
Step 6: Matching product families with the supply chain strategies

The functional product families were matched with the lean strategy, while the innovative
product families were matched with the agile supply chain strategy. All other product
families were identified as hybrid product families, which were matched to the leagile
supply chain strategies.
Step 7: Identification of criteria to determine DP location for the selected

product family
The product family that contained higher demands and a wider product range was
selected to guide the experts and decision-makers. The criteria that could be used for the
selection of DP location (Table 1) were discussed with the expert group, 11 criteria were
identified, including predictability of demand (C11), delivery reliability (C12), delivery
lead time (C13), order size (C14), order frequency (C15), modular product design (C21),
holding cost (C22), backorder cost (C23), production lead time (C31), process and human
resources flexibility (C32) and the location of the bottleneck (C33).
Step 8: Identification of interactions and causal relationship between criteria by

fuzzy Dematel
At this stage, the interactions and relationships between the criteria were evaluated. The
method of converting fuzzy data into crisp scores (CFCS) was used for defuzzification.
The steps of CFCS method were given in Appendix A. This method was preferred
because it gave greater membership function and greater precise values. As a result of
this method, direct-relation matrix Z was found. Then the steps of Dematel method were
applied (see Appendix B). Initially Z matrix was normalised, the normalised direct
relation matrix X and finally, total relation matrix T was calculated.
⎡0.185 0.247 0.374 0.316 0.340 0.223 0.342 0.329 0.312 0.275 0.301 ⎤
⎢0.221 0.186 0.386 0.303 0.318 0.232 0.308 0.324 0.324 0.288 0.286 ⎥⎥
⎢
⎢0.337 0.368 0.419 0.444 0.451 0.339 0.477 0.480 0.474 0.434 0.444 ⎥
⎢ ⎥
⎢0.265 0.260 0.417 0.270 0.355 0.263 0.379 0.368 0.395 0.319 0.315 ⎥
⎢0.297 0.263 0.429 0.340 0.282 0.262 0.391 0.364 0.382 0.330 0.319 ⎥
⎢ ⎥
T = ⎢0.202 0.237 0.349 0.289 0.291 0.194 0.313 0.332 0.353 0.302 0.312 ⎥
⎢0.276 0.308 0.481 0.392 0.404 0.330 0.332 0.448 0.426 0.371 0.388 ⎥
⎢ ⎥
⎢0.301 0.325 0.495 0.415 0.412 0.327 0.434 0.351 0.450 0.386 0.419 ⎥
⎢ ⎥
⎢0.274 0.267 0.423 0.372 0.372 0.324 0.385 0.404 0.324 0.381 0.390 ⎥
⎢0.256 0.249 0.397 0.328 0.348 0.288 0.351 0.369 0.390 0.260 0.350 ⎥
⎢ ⎥
⎣0.263 0.249 0.391 0.319 0.330 0.291 0.345 0.367 0.368 0.328 0.263 ⎦
The sum of rows and columns of the T matrix regarding the criteria is presented in
Table 4. In order to keep the complexity of the model at a manageable level in systems
with a high number of criteria and to explain the structural relationship between the
criteria, the threshold value p was used with a view to filtering the negligible effects in
the T matrix. The average of all values in the T matrix was calculated (Sumrit and
Anuntavoranich, 2013) and the threshold value p was found to be 0.339. The criteria that
are higher than the threshold and have an interaction between were indicated in bold in
the T matrix.
Based on the Di – Rj values indicated in Table 4, the criteria were assigned into
‘cause’ and ‘effect’ groups. The cause group included the criteria C11, C12, C13, C21, C22
and C23 with positive Di – Rj value, and the effect group included the criteria C14, C15, C31,
C32 and C33 with the negative Di – Rj value. As the effects of the criteria in the cause
group were greater on the system, these criteria should be followed carefully. The criteria
contained in the effect group were influenced by the criteria in the cause group and they
could improve the system performance through modifications and improvements in the
criteria influencing them.
Figure 3 Network relationship map

322
Table 4
H.E. Aktan and G. Akyuz
C11 C12 C13 C14 C15 C21 C22 C23 C31 C32 C33
Di 3.243 3.176 4.669 3.606 3.660 3.175 4.156 4.315 3.916 3.587 3.515
Rj 2.877 2.960 4.561 3.788 3.904 3.073 4.057 4.137 4.199 3.675 3.788
Di + Rj 6.120 6.136 9.229 7.394 7.564 6.248 8.213 8.452 8.115 7.262 7.303
Di – Rj 0.366 0.216 0.108 –0.182 –0.243 0.103 0.099 0.178 –0.283 –0.088 –0.273
Sum of rows and columns of all criteria (p = 0.339)
Step 9: Determining the criterion weights by DANP

At this stage, the network relationship map (NRM) created by means of the Fuzzy
Dematel method (Figure 3) was used to develop the ANP model. The criteria weights
were determined by DANP method, taking account of the relationships found in the ANP
model. DANP method was preferred in this study because it was difficult for the decision
makers to identify the interdependency between the criteria and the feedback with ANP
method and to assess these relationships.
The steps of the DANP method that combines Dematel with ANP are presented as
follows and can be seen in Appendix C (Chen et al., 2011; Lee et al., 2011; Liu et al.,
2012; Wang and Tzeng, 2012; Hung et al., 2012; Chiu et al., 2013):
a Calculating the TC matrix: total relation matrix demonstrating the relationships
between the criteria (TC) was the T matrix obtained from the Dematel method in the
beginning of the study. The sum of each row in each of the clusters of the TC matrix
was divided into the value in that row for normalisation and as a result TC∝ matrix
was developed.
⎡0.126 0.169 0.256 0.216 0.233 0.249 0.383 0.368 0.352 0.309 0.339 ⎤
⎢0.156 0.132 0.273 0.214 0.225 0.269 0.356 0.375 0.361 0.321 0.319 ⎥⎥
⎢
⎢0.167 0.182 0.207 0.220 0.223 0.262 0.368 0.370 0.351 0.321 0.328 ⎥
⎢ ⎥
⎢0.169 0.166 0.266 0.172 0.227 0.261 0.375 0.364 0.384 0.310 0.306 ⎥
⎢0.184 0.163 0.266 0.211 0.175 0.257 0.385 0.358 0.371 0.320 0.309 ⎥
⎢ ⎥
TC∝ = ⎢0.148 0.173 0.255 0.211 0.213 0.231 0.373 0.395 0.365 0.312 0.323 ⎥
⎢0.148 0.166 0.259 0.211 0.217 0.297 0.299 0.404 0.359 0.313 0.328 ⎥
⎢ ⎥
⎢0.155 0.167 0.254 0.213 0.211 0.294 0.390 0.316 0.358 0.308 0.334 ⎥
⎢ ⎥
⎢0.160 0.157 0.247 0.218 0.218 0.291 0.346 0.363 0.296 0.348 0.356 ⎥
⎢0.162 0.158 0.252 0.208 0.220 0.285 0.348 0.366 0.390 0.260 0.350 ⎥
⎢ ⎥
⎣0.169 0.161 0.252 0.205 0.213 0.290 0.344 0.366 0.384 0.342 0.274 ⎦
The transpose of the TC∝ matrix that was calculated and the unweighted supermatrix
(W) was obtained.
⎡0.126 0.156 0.167 0.169 0.184 0.148 0.148 0.155 0.160 0.162 0.169 ⎤
⎢0.169 0.132 0.182 0.166 0.163 0.173 0.166 0.167 0.157 0.158 0.161 ⎥⎥
⎢
⎢0.256 0.273 0.207 0.266 0.266 0.255 0.259 0.254 0.247 0.252 0.252 ⎥
⎢ ⎥
⎢0.216 0.214 0.220 0.172 0.211 0.211 0.211 0.213 0.218 0.208 0.205 ⎥
⎢0.233 0.225 0.223 0.227 0.175 0.213 0.217 0.211 0.218 0.220 0.213 ⎥
⎢ ⎥
W = ⎢0.249 0.269 0.262 0.261 0.257 0.231 0.297 0.294 0.291 0.285 0.290 ⎥
⎢0.383 0.356 0.368 0.375 0.385 0.373 0.299 0.390 0.346 0.348 0.344 ⎥
⎢ ⎥
⎢0.368 0.375 0.370 0.364 0.358 0.395 0.404 0.316 0.363 0.366 0.366 ⎥
⎢ ⎥
⎢0.352 0.361 0.351 0.384 0.371 0.365 0.359 0.358 0.296 0.390 0.384 ⎥
⎢0.309 0.321 0.321 0.310 0.320 0.312 0.313 0.308 0.348 0.260 0.342 ⎥
⎢ ⎥
⎣0.339 0.319 0.328 0.306 0.309 0.323 0.328 0.334 0.356 0.350 0.274 ⎦
b Obtaining the weighted supermatrix: For the dimensions, TD matrix obtained with the
Dematel method was normalised ( TD∝ ):
⎡0.276 0.369 0.355 ⎤

TD∝ = ⎢⎢0.301 0.342 0.357 ⎥⎥
⎢⎣0.298 0.372 0.330 ⎥⎦
The weighted supermatrix was calculated (W∝):

⎡0.035 0.043 0.046 0.047 0.051 0.044 0.045 0.047 0.048 0.048 0.050 ⎤
⎢0.047 0.036 0.050 0.046 0.045 0.052 0.050 0.050 0.047 0.047 0.048 ⎥⎥
⎢
⎢0.071 0.075 0.057 0.073 0.074 0.077 0.078 0.076 0.074 0.075 0.075 ⎥
⎢ ⎥
⎢0.060 0.059 0.061 0.048 0.058 0.064 0.063 0.064 0.065 0.062 0.061 ⎥
⎢0.064 0.062 0.062 0.063 0.048 0.064 0.065 0.064 0.065 0.066 0.063 ⎥
⎢ ⎥
W∝ = ⎢0.092 0.099 0.097 0.096 0.095 0.079 0.101 0.100 0.108 0.106 0.108 ⎥
⎢0.141 0.132 0.136 0.138 0.142 0.127 0.102 0.133 0.129 0.130 0.128 ⎥
⎢ ⎥
⎢0.136 0.138 0.137 0.134 0.132 0.135 0.138 0.108 0.135 0.136 0.136 ⎥
⎢ ⎥
⎢0.125 0.128 0.124 0.136 0.132 0.130 0.128 0.128 0.098 0.129 0.127 ⎥
⎢0.110 0.114 0.114 0.110 0.114 0.112 0.112 0.110 0.115 0.086 0.113 ⎥
⎢ ⎥
⎣0.120 0.113 0.116 0.109 0.110 0.115 0.117 0.119 0.118 0.116 0.091 ⎦
c Obtaining the limit supermatrix: The weights of the criteria can be obtained by the
limit supermatrix. The weights are presented in Table 5 (Liu et al., 2012).
⎡0.046 0.046 0.046 0.046 0.046 0.046 0.046 0.046 0.046 0.046 0.046 ⎤
⎢0.048 0.048 0.048 0.048 0.048 0.048 0.048 0.048 0.048 0.048 0.048 ⎥⎥
⎢
⎢0.074 0.074 0.074 0.074 0.074 0.074 0.074 0.074 0.074 0.074 0.074 ⎥
⎢ ⎥
⎢0.061 0.061 0.061 0.061 0.061 0.061 0.061 0.061 0.061 0.061 0.061 ⎥
⎢0.063 0.063 0.063 0.063 0.063 0.063 0.063 0.063 0.063 0.063 0.063 ⎥
⎢ ⎥
lim (W ∝ )
h
= ⎢0.100 0.100 0.100 0.100 0.100 0.100 0.100 0.100 0.100 0.100 0.100 ⎥
h →∞
⎢0.128 0.128 0.128 0.128 0.128 0.128 0.128 0.128 0.128 0.128 0.128 ⎥
⎢ ⎥
⎢0.132 0.132 0.132 0.132 0.132 0.132 0.132 0.132 0.132 0.132 0.132 ⎥
⎢ ⎥
⎢0.125 0.125 0.125 0.125 0.125 0.125 0.125 0.125 0.125 0.125 0.125 ⎥
⎢0.109 0.109 0.109 0.109 0.109 0.109 0.109 0.109 0.109 0.109 0.109 ⎥
⎢ ⎥
⎣0.113 0.113 0.113 0.113 0.113 0.113 0.113 0.113 0.113 0.113 0.113 ⎦
Table 5 Criteria weights obtained with DANP method
Criterion C11 C12 C13 C14 C15 C21

Wi 0.046 0.048 0.074 0.061 0.063 0.100
Criterion C22 C23 C31 C32 C33
Wi 0.128 0.132 0.125 0.109 0.113
Step 10: Selecting the most appropriate alternative by fuzzy TOPSIS

Indeed, lean strategy was proposed to provide a higher degree flexibility or agility. But in
time, this strategy could not be successful enough to be fast against effectiveness. Due to
these constraints of the ‘lean’ strategy, a more agile approach was required for certain
supply chains. The critical question at this stage is how to use the lean and agile strategies
in a single supply chain and where the point of conversion of the supply chains from the
‘lean’ to ‘agile’ is (Nieuwenhuis and Kotsifou, 2015). In order to answer this question, it
was intended to find the transition point from lean to agile strategy, namely the DP
location.
Figure 4 Production flow chart
As it is seen in Figure 4, the company’s production process was assessed to determine the
DP location of the selected product or strategy. Even though this study was about SC
strategies, the expert group of the company agreed on concentrating only on the
production process as Guven-Uslu et al. (2014) stated in their study. Actually, at several
stages of this study, all the processes including suppliers and customers were considered,
however the decision makers agreed on the production process to determine the DP
location.
The alternatives of the DP location in this study were comprised of the workstations
used for manufacturing the product family (Figure 4). Decision makers assessed the
alternatives by using the criteria that were identified with TOPSIS. Like in the other
methods used in the study, TOPSIS method also used fuzzy set theory for vagueness,
uncertainties, inexactness of data and the subjectivity associated with human judgement
(Kumar et al., 2013). The fuzzy decision matrix was normalised, the criterion weights
calculated at step 9 were used to obtain the weighted normalised fuzzy decision matrix
(see Appendix D).
The distance of each alternative from the fuzzy positive ideal number, fuzzy negative
ideal number and closeness coefficient were calculated and the alternatives were ranked
(Table 6).
Table 6 Ranking of the alternatives
di* d i− CCi Ranking

A1 10.3156 0.6967 0.0633 5
A2 10.2930 0.7211 0.0655 3
A3 10.2944 0.7208 0.0654 4
A4 10.1398 0.8683 0.0789 1
A5 10.1795 0.8284 0.0753 2
By the end of ranking, it was found that the coating workstation was the most appropriate
DP location for the selected product family (Figure 5).
In the light of these results, the products in the family are manufactured according to
the lean strategy until the end of the sanding process and at that point they are held as
semi-finished products (sanded but uncoated for this product) according to the product
demand forecasts. The demand is constant and predictable at this phase, which is
managed through demand forecasts. When a customer order penetrates into the DP, in
another word, when a customer order comes in at this point, the product family is
differentiated and products are coated and packed according to the order specifications.
Following this point, the customer pulls the product. For the processes after DP, the agile
strategy is used to make and deliver the product demanded by the customer on time.
MTO strategy is appropriate for this product family. The coating workstation
distinguishes the lean and agile strategies from one another; the lean strategy terminates
at this workstation and the agile strategy is starts.
Figure 5 DP location according to the DANP-TOPSIS method
Step 11: Obtaining the optimal alternative solution set by zero-one goal
programming (ZOGP)
Although the alternatives were ranked by means of the fuzzy DANP-TOPSIS method
based on the views and assessments of the experts, they were analysed in order to see if
the same result could be obtained under specific constraints. To this end, the weights of
the alternatives found at Step 10 were used as constraints in the ZOGP model. The
constraints and requirements of each alternatives necessary to determine an optimal DP
alongside the leagile supply chain are presented in Table 7, and the ZOGP model
developed is shown in Table 8.
Table 7 Resource requirements of alternatives
x1(A1) x2(A2) x3(A3) x4(A4) x5(A5) bi

Set-up time (min) 15 90 60 70 0 90
Performance rate 0.80 0.90 0.90 0.93 0.93 0.93
Loss rate 0.02 0.06 0 0.16 0 0.24
Production speed (m/h) 2.615 1.507 1.507 1.881,5 1.881,5 877,55
Table 8 ZOGP model formulation
Model Goals
Min Z =
p1 ( d1+ ) Satisfy 1 constraint
p2 ( d 2− ) Satisfy 2 constraint
p3 ( d3+ ) Satisfy 3 constraint
p4 ( d 4− ) Satisfy 4 constraint
p5 ( 0.0633d 5− + 0.0655d 6− + 0.0654d 7− + 0.0789d8− + 0.0753d9− ) Select highest fuzzy DANP-

TOPSIS weighted alternative
Subject to
15 x1 + 90 x2 + 60 x3 + 70 x4 + d1− − d1+ = 90 Avoid over utilising
maximum setup time
0.80 x1 + 0.90 x2 + 0.90 x3 + 0.93x4 + 0.93x5 + d 2− − d 2+ = 0.93 Avoid under utilising
minimum performance rate
0.02 x1 + 0.06 x2 + 0.00 x3 + 0.16 x4 + 0.00 x5 + d3− − d 3+ = 0.24 Avoid over utilising
maximum loss rate
2.615 x1 + 1.507 x2 + 1.507 x3 + 1.881,5 x4 + 1.881,5 x5 Avoid under utilising
minimum production time
+ d − d = 877,55
−
4
+
4
x1 + d5− = 1 Select 1 alternative
x2 + d 6− = 1 Select 2 alternative
x3 + d 7− = 1 Select 3 alternative

xi = 0 or 1 (i = 1, 2, 3, 4, 5)
d −j , d ∓j ≥ 0 ( j = 1,…,9)
The results of the model are as follows.

x1 = 1, x2 = 0, x3 = 0, x4 = 1, x5 = 1, d1− = 5, d1+ = 0, d 2− = 0, d 2+ = 1.73, d3− = 0.06,
d3+ = 0, d 4− = 0, d 4+ = 5.500, 45 d5− = 0, d 6− = 4, d 7− = 1, d8− = d9− = 0.
An evaluation of the deviation variables shows that the first goal was fulfilled in
five minutes, the third goal was achieved with 6% negative deviation, while the second
goal was fulfilled with 173% positive deviation and the fourth goal was achieved with a
positive deviation of 5.500,45. Workstations no 1, 4 and 5 where the customer orders
penetrate were deemed to be optimal for the product family that was assessed according
to the results of the ZOGP model.
5 Conclusions and future research
Due to the changing market conditions, advanced manufacturing technologies and

increased customer expectations, today’s companies have to face with the fact that they
have to care about the competitive advantage of the supply chain strategies. Therefore,
companies may have to adopt different strategies for different products with different
characteristics manufactured for specific markets rather than applying one-size-fits-all
supply chain strategy to each product with a view to increasing their competitiveness and
market shares.
Although the concepts of lean and agile are perceived to be opposite in some cases,
lean and strategies were merged in a supply chain in this study in order to handle the
market fluctuations.
The methodology described above in details, was applied through a case study. The
study was performed in a furniture components manufacturing company with the
participation of an expert group. The case study was conducted to clarify the results of
adapting different supply chain strategies directly in a company. As a result of this case
study, decision makers recognised the need to focus on different strategies for different
products, different business models for each strategy and different management
approaches.
Following the product classification at the company analysed in the case study in
order to match the optimal supply chain strategies with the products: the functional
products (high-volume products) were matched with the lean supply chain strategy, the
innovative products (low-volume products) were matched with the agile supply chain
strategy while the hybrid product families were matched with the leagile supply chain
strategy. The selected product family was analysed and the coating workstation was
found both in Dematel-DANP-TOPSIS and two stage Dematel-DANP-TOPSIS and
ZOGP methods. Although an alternative solution set comprised of three alternatives was
identified with ZOGP method, mainly cutting process was found to be optimal for the
agile strategy while packaging process was optimal for the lean strategy.
Three basic strategies came to the forefront as a result of product-supply chain
matching: agile, lean and leagile. First of all, the company should ensure that the products
of agile strategy are available at any time needed and in the required quantity. In order to
do so, the company should ensure flow of information with the suppliers and customers,
develop cooperative relationships and design strategies for postponing the product as
long as possible, hold in stock the materials of key importance, but inexpensive, have a
reliable third party supplier or logistic system, make plans for unexpected events and
form teams for crisis management. The analysis showed that there were only a very few
products/product families for which the company should use the lean supply chain
strategy. However, it should be remembered that the company can switch between the
supply chain strategies in time. Based on the idea of eliminating the losses that forms the
key of the lean supply chain, the company should review all its activities and processes
that do not create value alongside the chain.
As in all studies, this study has some limitations such as company size, subjective
assessments and bias of evaluators. The results were obtained from a single company by
using instantaneous data. Due to the limitation of the case study, it was difficult to
generalise the results to all furniture companies. Therefore, this case study, which was
about only a single industry, single company and a single product family, could vary
according to market, production and customer of every company and industry. In further
studies, the entire chain of a company in any industry may be included in the research.
Moreover, the trend of classification of the products and matching them with strategies
couldn’t be traced back because the historical data of the company wasn’t available.
Finally, in this study, it wasn’t possible to measure the financial, operational and
qualitative impact of the recommended model.
The study has many managerial and practical implications such as providing
information on the framework of product classification, matching of different production
types with supply chain strategies and positioning of particularly the decoupling point of
a leagile supply chain. A road map for managing the process leagile supply chain for
leading the decision makers about being more productive was presented in this study.
This paper contributes to the literature by demonstrating how the product-supply
chain strategy matching can be performed and how the position of the decoupling point
along a leagile supply chain can be determined. The findings of this study could be
applied or extended in other sectors. This study can be further elaborated by assessing the
production planning, inventory and purchasing policies, supplier and customer
relationships separately or as a whole for a product family for which a DP is positioned.
This study was performed only for one product family, but it can be extended by
including the other product families. Moreover, the periodic variations in the locations of
DP of product families analysed and the likelihood that these variations might be in
parallel to the product life cycle may be explored in further studies.
This study can be one of the first studies that made an effort to match products with
strategies, determine the DP of a leagile strategy using Dematel-DANP-TOPSIS and
ZOGP methods.
Acknowledgements
This study is adapted from the PhD Thesis of Hande Erdoğan Aktan with the title of
‘Matching product-supply chain strategy and identifying the decoupling point for hybrid
supply chain strategy’. I’d like to extend our special thanks to the reviewers of this paper
who provided important recommendations to improve its quality.
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Appendix A
CFCS method
Z ijk = ( lijk , mijk , rijk ) represents the fuzzy assessment made by k number of assessors
(k = 1, 2,…,p) regarding the degree of the criteria i to influence the criteria j. Five-step
algorithm of the CFCS method is as follows (Opricovic and Tzeng, 2003; Lee and Chou,
2016):
1 Normalisation
rimax = max j rij , limin = min j lij
Δ max
min = ri
max
− limin
Compute for xlijk , xmijk , xrijk for all alternatives aj = (j = 1, 2,…J)
xlijk = ( lijk − min lijk ) / Δ max

min
xmijk = ( mijk − min lijk ) / Δ max

min
xrijk = ( rijk − min lijk ) / Δ max

min
2 Compute left (ls) and right (rs) normalized values for j = 1, 2,…J
xmijk
xlsijk =
1 + xmijk − xlijk
xrijk
xrsijk =
1 + xrijk − xmijk
3 Compute total normalised crisp value for j = 1, 2,…J
xijk = ⎡⎣ xlsijk (1 − xlsijk ) + xrsijk xrsijk ⎤⎦ / ⎡⎣1 − xlsijk + xrsijk ⎤⎦
4 Compute crisp values for j = 1,2,…J

zijk = min lijk + xijk Δ max
min
5 Integrate crisp values for j = 1, 2,…J:

1 1
zij =
p
(
zij + zij2 + + zijp )
Appendix B
DEMATEL method
The steps of Dematel method are as follows (Govindan et al., 2016; Shieh and Wu,
2016):
1 Generating the direct-relation matrix: in this paper, direct-relation matrix (Z) is
obtained by CFCS method.
2 Normalising the direct-relation matrix: the calculation of normalised direct-relation
matrix (X) is below.
X = s.Z
1
s= i, j = 1, 2,… n
∑
n
max1≤i ≤ n zij
j =1
3 Obtaining total relation matrix: the calculation of total relation matrix (T) is as
follows.
−1
T = X (1 − X )
4 Generating a causal diagram: D and R are expressed as the sum of rows and
columns, respectively and calculated by the following formulas.
T = [tij ]nxn i, j = 1, 2,… , n
⎡ n
⎤
∑
R = ⎢ tij ⎥
⎣⎢ i =1 ⎦⎥1xn
= [t j ]1xn
⎡ n ⎤
D=⎢
⎢⎣
∑t
j =1
ij ⎥
⎥⎦ nx1
= [t j ]nx1
D + R and D – R depict the degree of significance and shows the net effect
respectively. Network relationship map is obtained using (D + R) and (D – R) values.
Appendix C
DANP method
The steps of the DANP method that combines the Dematel technique with the ANP
model are presented below:
TC = [tij]nxn is the total relation matrix derived from the criteria while TD = ⎡⎣tijD ⎤⎦ mxm is
the total relation matrix derived from the clusters. By using the total relation matrix
TD , TC matrix is normalised for the ANP weights.
Step 1: creating the weighted supermatrix

The total relation matrix showing the relations between the criteria which is TC is created
with the Dematel method (T matrix) and presented in the equation no (1).
⎡ tc11 tc1 j tc1n ⎤
⎢ ⎥
⎢ . . . ⎥
TC = ⎢ tci1 tcij tc1n ⎥ (1)
⎢ ⎥
⎢ . . . ⎥
⎢ n1 ⎥
⎣⎢tc tcnj tcnn ⎦⎥
A new matrix that is TC∝ is developed by normalising the TC matrix. This matrix is shown
in the equation no (2). The sum of each row in each cluster is divided by the values in
that row for normalisation.
⎡tcα 11 tcα 1 j tcα 1n ⎤
⎢ ⎥
⎢ . . . ⎥
TC = ⎢ tcα i1
α
tcα ij
tcα 1n ⎥ (2)
⎢ ⎥
⎢ . . . ⎥
⎢ α n1 α nj ⎥
⎣⎢tc tc tcα nn ⎦⎥
tcα 11 is normalised with equations no (3) and (4) and this is continued until tcα nn is
obtained.
∑
m
di11 = t11ij , i = 1, 2,… , m1 (3)
j =1 c
⎡ tc1111 / d111 tc111 j / d111 tc111m1 / d111 ⎤ ⎡ tcα1111 tcα111

j m1 ⎤
tcα111
⎢ ⎥ ⎢ ⎥
⎢ . . . ⎥ ⎢ . . . ⎥
T α 11 ⎢
= tci1 / di11
11
tc11ij / di11 11 11 ⎥
tc1m1 / di = ⎢ tcαi111 t α 11 tcαim111 ⎥ (4)
c
⎢ ⎥ ⎢ cij ⎥
⎢ . . . ⎥ ⎢ . . . ⎥
⎢ 11 11 ⎥ ⎢ ⎥
11
⎣⎢ cm11 / d m1
t tc11m1 j / d m111 tcm1m1 / d m1 ⎦⎥ ⎣⎢tcαm11
11
11
tcαm11
11
tcαm11
1m1 ⎦⎥
The weighted supermatrix is shown in equation no (5). This new matrix is referred to as
normalised matrix (W). It is the form of tcα matrix for which transpose is calculated.
⎡W 11 W i1 W n1 ⎤
⎢ ⎥
⎢ . . . ⎥
α ′
W = (TC ) = ⎢W 1 j W ij W nj ⎥ (5)
⎢ ⎥
⎢ . . . ⎥
⎢W 1n W in W nn ⎥⎦
⎣
Step 2: Obtaining the weighted supermatrix

TD is normalised to obtain t αD matrix by using the equation no (7).
⎡ t11
D t1Dj t1Dn ⎤
⎢ ⎥
⎢ . . . ⎥
TD = ⎢ t Di1 t Dij t1Dn ⎥
⎢ ⎥
⎢ . . . ⎥ (6)
⎢ n1 ⎥
⎣⎢t D t Dnj t Dnn ⎦⎥
∑
n
t ij = di i = 1, 2,… , n.
j =1
⎡ t11
D / d1 t1Dj / d1 t1Dn / d1 ⎤ ⎡t Dα 11 tcα11j j t Dα 1n ⎤
⎢ ⎥ ⎢ ⎥
⎢ . . . ⎥ ⎢ . . . ⎥
TD = ⎢ t Di1 / di ⎢ ⎥
α
t Dij / di t Din / di ⎥ = ⎢ t Dα i1 α ij
tD t Dα in ⎥ (7)
⎢ ⎥
⎢ . . . ⎥ ⎢ . . . ⎥
⎢ n1 ⎥ ⎢ ⎥
⎢⎣t D / d n t Dnj / dn t Dnn / d n ⎥⎦ ⎢⎣t Dα n1 tDα nj
t Dα nn ⎥⎦
Then the equation no (8) is used to calculate the weighted supermatrix.

⎡ t αD11 × W 11 t Dα i1 × W i1 t Dα n1 × W n1 ⎤
⎢ ⎥
⎢ . . . ⎥
W = TD W = ⎢t D × W 1 j
α α α 1 j α ij
t D × W ij t Dα nj × W nj ⎥ (8)
⎢ ⎥
⎢ . . . ⎥
⎢t α 1n × W 1n t Dα in × W in α
tD × W ⎦
nn nn ⎥
⎣D
Appendix D
Fuzzy TOPSIS method

Assuming that there is a decision group comprised of K members, the common decision
of the group is found with the equations no (9) and (10) in order to rank the weights of
the criteria and the alternatives according to each criterion (Chen, 2000).
1 1
xij = ⎡ xij + xij2 + … + xijK ⎤⎦ (9)
K⎣
1 1
wj = ⎡ w j + w2j + … + w Kj ⎦⎤ (10)
K⎣
i = 1, 2,…m; j = 1, 2,…n. m accounts for the alternatives, while n represents the criteria.
Step 1: Obtaining the fuzzy decision matrix

Fuzzy multi-criteria decision-making problem is shown in matrix form with the help of
the equations no (11) and (12).
⎡ x11 x12 … x1n ⎤
⎢x x22 … x2 n ⎥⎥
D=⎢
21
(11)
⎢ … ⎥
⎢ ⎥
⎣ xm1 xm 2 … xmn ⎦
W = [ w1 , w2,…, wn ]
(12)
xij (∀i, j ), w j are linguistic variables which can be defined by triangular fuzzy numbers.
Step 2: Obtaining the normalised fuzzy decision matrix

Normalised fuzzy decision matrix (R) is obtained with the equation no (13).
R = [ rij ]m×n (13)
When B and C represent benefit criterion and cost criterion, respectively, whichever of
equations no (14) and (15) is relevant, it is used.
⎛ aij bij cij ⎞
rij = ⎜ * , * , * ⎟ , j ∈ B; (14)
⎝ cj cj cj ⎠
⎛ a −j a −j a −j ⎞
rij = ⎜ , , ⎟ , j ∈ C; (15)
⎝ cij bij aij ⎠
c*j = max i cij if j ∈ B; a −j = min i aij if j ∈ C.
Step 3: Calculating the weighted normalised fuzzy matrix

When each criterion has a different weight, the weighted normalised fuzzy matrix ( V ) is
calculated through the equation no (16).
V = [ vij ]m×n i = 1, 2,… , m, j = 1, 2,… , n

(16)
vij = rij w j
Step 4: Identifying fuzzy positive ideal solution (FPIS) and fuzzy negative ideal
solution (FNIS)
After the weighted normalised fuzzy decision matrix is obtained, FPIS and FNIS are
calculated as shown by equations no (17) and (18).
v*j = (1, 1, 1) ; v −j = (0, 0, 0)
A* = ( v1* , v2* ,… vn* ) (17)

A− = ( v1− , v2− ,… vn− ) (18)
The distance of each alternative from A* and A– can be calculated as:

n
di* = ∑ d (v , v ),
j =1
v ij
*
j i = 1, 2,… , m, (19)
n
di− = ∑ d (v , v
j =1
v ij
−
j ), i = 1, 2,… , m, (20)
The closeness alternative can be calculated as (Erdoğan-Aktan and Tosun, 2013):

di−
CCi = , i = 1, 2,… , m (21)
di* + di−
V i e w p u b l i c a t i o n s t a t s

Positioning The Decoupling Point Along A Supply Chain: A Case Study

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Positioning the decoupling point along a supply chain: a case study

Article in International Journal of Productivity and Quality Management · January 2017

Hande Aktan Gökhan Akyuz

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Positioning the decoupling point along a supply

Hande Erdogan Aktan*

Keywords: lean; agile; leagile; decoupling point; supply chain strategy;

Copyright © 2017 Inderscience Enterprises Ltd.

Gokhan Akyuz received his Master’s degree in Business Administration from

This paper is a revised and expanded version of a paper entitled ‘Determination

2 Literature review on matching products with supply chain strategies

3 Lean, agile and leagile supply chain strategies

3.1 Lean supply chain strategy

3.2 Agile supply chain strategy

3.3 Leagile supply chain strategy

Table 1 Criteria influencing the DP position

Market related Product related Process related

Step 1: Data collection and compilation

Figure 2 Methodology of the study

Step 2: Classification of products

Step 3: Matching products with supply chain strategies

Product type Quantity Supply chain strategy DP location

Step 4: Clustering the unmatched products under product families

Product Market Technological

Step 5: Classification of product families

Step 6: Matching product families with the supply chain strategies

Step 7: Identification of criteria to determine DP location for the selected

Step 8: Identification of interactions and causal relationship between criteria by

Figure 3 Network relationship map

Step 9: Determining the criterion weights by DANP

⎡0.276 0.369 0.355 ⎤

The weighted supermatrix was calculated (W∝):

Table 5 Criteria weights obtained with DANP method

Criterion C11 C12 C13 C14 C15 C21

Step 10: Selecting the most appropriate alternative by fuzzy TOPSIS

Figure 4 Production flow chart

di* d i− CCi Ranking

Figure 5 DP location according to the DANP-TOPSIS method

x1(A1) x2(A2) x3(A3) x4(A4) x5(A5) bi

Table 8 ZOGP model formulation

p3 ( d3+ ) Satisfy 3 constraint

p5 ( 0.0633d 5− + 0.0655d 6− + 0.0654d 7− + 0.0789d8− + 0.0753d9− ) Select highest fuzzy DANP-

x1 + d5− = 1 Select 1 alternative

x4 + d8− = 1 Select 4 alternative

x5 + d9− = 1 Select 5 alternative

The results of the model are as follows.

5 Conclusions and future research

Due to the changing market conditions, advanced manufacturing technologies and

Compute for xlijk , xmijk , xrijk for all alternatives aj = (j = 1, 2,…J)

xlijk = ( lijk − min lijk ) / Δ max

xmijk = ( mijk − min lijk ) / Δ max

xrijk = ( rijk − min lijk ) / Δ max

3 Compute total normalised crisp value for j = 1, 2,…J

xijk = ⎡⎣ xlsijk (1 − xlsijk ) + xrsijk xrsijk ⎤⎦ / ⎡⎣1 − xlsijk + xrsijk ⎤⎦

4 Compute crisp values for j = 1,2,…J

5 Integrate crisp values for j = 1, 2,…J:

Step 1: creating the weighted supermatrix

⎡ tc1111 / d111 tc111 j / d111 tc111m1 / d111 ⎤ ⎡ tcα1111 tcα111

Step 2: Obtaining the weighted supermatrix

Then the equation no (8) is used to calculate the weighted supermatrix.

Fuzzy TOPSIS method