Analysis of simple inventory control systems with execution errors: Economic impact under correction opportunities

Cataloged from PDF version of article.Motivated by recent empirical evidence, we study the economic impact of inventory record inaccuracies that arise due to execution errors. We model a set of probable events regarding the erroneous registering of sales at each demand arrival. We define correction opportunities that can be used to (at least partially) correct inventory records. We analyze a simple inventory control model with execution errors and correction opportunities, and demonstrate that decisions that consider the existence of recording errors and the mechanisms with which they are corrected can be quite complicated and exhibit complex tradeoffs. To evaluate the economic impact of inventory record inaccuracies, we use a simulation model of a (Q,r) inventory control system and evaluate suboptimalities in cost and customer service that arise as a result of untimely triggering of orders due to inventory record inaccuracies. We show that the economic impact of inventory record inaccuracies can be significant, particularly in systems with small order sizes and low reorder levels. (C) 2010 Elsevier BM. All rights reserved

The Q(s,S) control policy for the joint replenishment problem extended to the case of correlation among item-demands

We develop an algorithm to compute an optimal Q(s,S) policy for the joint replenishment problem when demands follow a compound correlated Poisson process. It is a non-trivial generalization of the work by Nielsen and Larsen (2005). We make some numerical analyses on two-item problems where we compare the optimal Q(s,S) policy to the optimal uncoordinated (s,S) policies. The results indicate that the more negative the correlation the less advantageous it is to coordinate. Therefore, in some cases the degree of correlation determines whether to apply the coordinated Q(s,S) policy or the uncoordinated (s,S) policies. Finally, we compare the Q(s,S) policy and the closely connected P(s,S) policy. Here we explain why the Q(s,S) policy is a better choice if item-demands are correlated.joint replenishment problem; compound correlated Poisson process

Optimality of (s, S) Inventory Policies under Renewal Demand and General Cost Structures

Peer Reviewedhttps://deepblue.lib.umich.edu/bitstream/2027.42/142450/1/poms12795_am.pdfhttps://deepblue.lib.umich.edu/bitstream/2027.42/142450/2/poms12795.pd

Tactical design of production-distribution networks : safety stocks, shipment consolidation and production planning

VII+217hlm.;24c

Performance analysis of hybrid MTS/MTO systems with stochastic demand and production

We present a comprehensive numerical approach with reasonably light complexity in terms of implementation and computation for assessing the performance of hybrid make-to-stock (MTS)/make-to-order (MTO) systems. In such hybrid systems, semi-finished products are produced up front and stored in a decoupling inventory. When an order arrives, the products are completed and possibly customised. We study this system in a stochastic setting: demand and production are modelled by random processes. In particular, our model includes two coupled Markovian queues: one queue represents the decoupling inventory and the other the order backlog. These queues are coupled as order processing can only occur when both queues are non-empty. We rely on matrix analytic techniques to study the performance of the MTO/MTS system under non-restrictive stochastic assumptions. In particular, we allow for arrival correlation and non-exponential setup and MTS and MTO processing times, while the hybrid MTS/MTO system is managed by an (s,S)-type threshold policy that governs switching from MTO to MTS and back. By some numerical examples, we assess the impact of inventory control, irregular order arrivals, setup and order processing times on inventory levels and lead times