Spatio-Temporal State Space Model Application in the Dynamic Supply Chain System

Abstract

The aim of the paper is to develop a spatio-temporal state space model with a better understanding of the dynamic characteristics in a supply chain system. The proposed model incorporates the space and time domain into the model of supply chain system. The estimation method is proposed based on the constructed model. The study will utilize a spatio- temporal state space model associated with EM algorithm technique in describing a dynamic characteristic of supply chain system. Inventory is managed based on demand forecasting at various points of the supply chain from incomplete data.