Multiple Criteria Inventory Classification for Storage Assignment and a Case Study

Abstract. Warehouse management has been turned into a more complicated issue depending on dynamics pertain to customer, good, speed and cost. It’s an inefficient and difficult approach to control all the stored items at the same level. Based on these; the main purpose of this study is bringing in a policy for warehouse management with the help of ABC Analysis via submitting the goods to inventory based classification. The goods will be assigned to slots according to their distances to the I/O point (Input/output point) by considering their importance orders at the end. In this context, DEMATEL method is utilized besides the Multi Criteria ABC Analysis methods used in literature. Initially Multi Criteria Decision Making techniques with weighted linear optimization, and in the following in order to make these calculations more accurate, calculation of cross evaluation of goods has been made in the literature. However, when we consider the calculation of cases which has increased numbers of goods, classification will be pretty hard. Thence, only cross evaluation points of goodsexceeding a threshold value when we apply DEMATEL method are calculated and applied to classification. On a model warehouse, mentioned techniques are benchmarked and it is shown that the approach, which is offered by us, reached similar or better results than the approaches in the literature in less time.Keywords. ABC Analysis, Multi Criteria Decision Making, Warehouse Management.JEL. M10, M11, M14

SKU classification: A literature review and conceptual framework

Purpose - Stock keeping unit (SKU) classifications are widely used in the field of production and operations management. Although many theoretical and practical examples of classifications exist, there are no overviews of the current literature, and general guidelines are lacking with respect to method selection for classifying SKUs. The purpose of this paper is to systematically synthesise the earlier work in this area, and to conceptualise and discuss the factors that influence the choice of a specific SKU classification. Design/methodology/approach - The paper structurally reviews existing contributions and synthesises these into a conceptual framework for SKU classification. Findings - How SKUs are classified depends on the classification aim, the context and the method that is chosen. In total, three main production and operations management aims were found: inventory management, forecasting and production strategy. Within the method three decisions are identified to come to a classification: the characteristics, the classification technique and the operationalisation of the classes. Research limitations/implications - Drawing on the literature survey, the authors conclude with a conceptual framework describing the factors that influence SKU classification. Further research could use this framework to develop guidelines for real-life applications. Practical implications Examples from a variety of industries and general directions are provided which managers could use to develop their own SKU classification. Originality/value - The paper aims to advance the literature on SKU classification from the level of individual examples to a conceptual level and provides directions on how to develop a SKU classification

Designing a new mathematical model based on ABC analysis for inventory control problem: A real case study

In modern business today, organizations that hold large numbers of inventory items, do not find it economical to make policies for the management of individual inventory items. Managers, thus, need to classify these items according to their importance and fit each item to a certain asset class. The method of grouping and inventory control available in traditional ABC has several disadvantages. These shortcomings have led to the development of an optimization model in the present study to improve the grouping and inventory control decisions in ABC. Moreover, it simultaneously optimizes the existing business relationships among revenue, investment in inventory and customer satisfaction (through service levels) as well as a company's budget for inventory costs. In this paper, a mathematical model is presented to classify inventory items, taking into account significant profit and cost reduction indices. The model has an objective function to maximize the net profit of items in stock. Limitations such as budget even inventory shortages are taken into account too. The mathematical model is solved by the Benders decomposition and the Lagrange relaxation algorithms. Then, the results of the two solutions are compared. The TOPSIS technique and statistical tests are used to evaluate and compare the proposed solutions with one another and to choose the best one. Subsequently, several sensitivity analyses are performed on the model, which helps inventory control managers determine the effect of inventory management costs on optimal decision making and item grouping. Finally, according to the results of evaluating the efficiency of the proposed model and the solution method, a real-world case study is conducted on the ceramic tile industry. Based on the proposed approach, several managerial perspectives are gained on optimal inventory grouping and item control strategies

In search for classification and selection of spare parts suitable for additive manufacturing: a literature review

This paper reviews the literature on additive manufacturing (AM) technologies and equipment, and spare parts classification criteria to propose a systematic process for selecting spare parts which are suitable for AM. This systematic process identifies criteria that can be used to select spare parts that are suitable for AM. The review found that there is limited research that addresses identifying processes for spare parts selection for AM, even though companies have identified this to be a key challenge in adopting AM. Seven areas for future research are identified relating to the methodology of spare parts selection for AM, processes for cross-functional integration in selecting spare parts for AM, broadening the spare parts portfolio that is suitable for AM (by considering usage of AM in conjunction with conventional technologies), and potential impact of AM on product modularity and integrality

The course of lectures on discipline “Logistics” for the 3rd year students of the specialty 6.030601 “Management” (full-time study bachelors)

The course of lectures on discipline “Logistics” have been discussed and approved at the meeting of the department of Innovation activity management and entrepreneurship of the Ternopil Ivan Puluj National Technical University on February 10, 2016, Minutes No12. The course of lectures on discipline “Logistics” have been discussed and approved at the meeting of the methodical committee of the faculty of Management and Business in Manufacturing Sphere of the Ternopil Ivan Puluj National Technical University on February 26, 2016, Minutes No5

Spare Parts Management for Nuclear Power Generation Facilities

With deregulation, utilities in the power sector face a much more urgent imperative to emphasize cost efficiencies as compared to the days of regulation. One major opportunity for cost savings is through reductions in spare parts inventory. Most utilities are accustomed to carrying large volumes of expensive, relatively slow-moving units because of a high degree of risk-averseness. This attitude towards risk is rooted in the days of regulation. Under regulation, companies recovered capital inventory costs by incorporating them into the base rate charged to its customers. In a deregulated environment, cost recovery is no longer guaranteed. Companies must therefore reexamine their risk profile and develop policies for spare parts inventory that are appropriate for a competitive business environment.This research studies the spare parts inventory management problem in the context of electric utilities, with a focus on nuclear power. It addresses three issues related to this problem: criticality, risk, and policy. With respect to criticality and risk, a methodology is presented that incorporates the use of influence diagrams and the Analytic Hierarchy Process (AHP). A new method is developed for group aggregation in the AHP when Saaty and Vargas' (2007) dispersion test fails and decision makers are unwilling or unable to revise their judgments. With respect to policy, a quantitative model that ranks the importance of keeping a part in inventory and recommends a corresponding stocking policy through the use of numerical simulation is developed. This methodology and its corresponding models will enable utilities that have transitioned from a regulated to a deregulated environment become more competitive in their operations while maintaining safety and reliability standards. Furthermore, the methodology developed is general enough so that other utility plants, especially those in the nuclear sector, will be able to use this approach. In addition to regulated utilities, other industries, such as aerospace and the military, can also benefit from extensions to these models, as risk profiles and subsequent policies can be adjusted to align with the business environment in which each industry or company operates