Advances in Operations Research
Volume 2012 (2012), Article ID 126254, 34 pages
Review Article

Performance Evaluation of Stochastic Multi-Echelon Inventory Systems: A Survey

1Engineering Systems Division, Department of Civil and Environmental Engineering, Massachusetts Institute of Technology, Cambridge, MA 02139, USA
2Department of Supply Chain Management and Marketing Sciences, Rutgers, The State University of New Jersy, Newark, NJ 07102, USA

Received 31 August 2011; Accepted 3 November 2011

Academic Editor: Shangyao Yan

Copyright © 2012 David Simchi-Levi and Yao Zhao. This is an open access article distributed under the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.


Globalization, product proliferation, and fast product innovation have significantly increased the complexities of supply chains in many industries. One of the most important advancements of supply chain management in recent years is the development of models and methodologies for controlling inventory in general supply networks under uncertainty and their widefspread applications to industry. These developments are based on three generic methods: the queueing-inventory method, the lead-time demand method and the flow-unit method. In this paper, we compare and contrast these methods by discussing their strengths and weaknesses, their differences and connections, and showing how to apply them systematically to characterize and evaluate various supply networks with different supply processes, inventory policies, and demand processes. Our objective is to forge links among research strands on different methods and various network topologies so as to develop unified methodologies.