Supply chain dynamic simulation with information coordination

In current supply chain simulation research, one of critical questions is how to determine the value of the information coordination. This paper contributes to the existing literature by solving that problem. At first, a two level supply chain simulation model through system dynamics (SD) approach is established, and then, the Simulink tool is adopted for that model. Through the simulation, it can be seen that the information coordination has great influence on the operation of the whole supply chain. Some little improvement for the information coordination can bring out large profit indirectly. That change may be calculated exactly in a special simulation condition. Thus, the value of the information coordination can be gained. What's more, the investment project can be evaluated in the view of supply chain systematically and entirely. © 2010 IEEE.