Combined make-to-order and make-to-stock in a food production system

The research into multi-product production/inventory control systems has mainly assumed one of the two strategies: Make-to-Order (MTO) or Make-to-Stock (MTS). In practice, however, many companies cater to an increasing variety of products with varying logistical demands (e.g. short due dates, specific products) and production characteristics (e.g. capacity usage, setup) to different market segments and so they are moving to more MTO-production. As a consequence they operate under a hybrid MTO-MTS strategy. Important issues arising out of such situations are, for example, which products should be manufactured to stock and which ones on order and, how to allocate capacity among various MTO-MTS products. This paper presents the state-of-the-art literature review of the combined MTO-MTS production situations. A variety of production management issues in the context of food processing companies, where combined MTO-MTS production is quite common, are discussed in details. The authors propose a comprehensive hierarchical planning framework that covers the important production management decisions to serve as a starting point for evaluation and further research on the planning system for MTO-MTS situations.

Make-to-order and make-to-stock in food processing industries

Productiebedrijven zijn de afgelopen jaren steeds meer van een 'make-to-stock ' strategie overgestapt op 'make-to-order'. Werken met een mix tussen die twee stelt speciale eisen aan de productieplanning en -beheersing. Chetan Soman kijkt in zijn proefschrift naar verschillende modellen en methoden die hiervoor reeds zijn ontwikkeld, met name die van de voedingsmiddelenindustrie waarin de houdbaarheid een belangrijke rol speelt. Soman introduceert een nieuw planningsmodel, dat toegankelijk is voor iedereen, omdat het in Access/Excel is uitgevoerd. Bovendien beantwoordt het proefschrift tal van theoretische en praktische vragen waarmee producenten te maken hebben.

Comparison of dynamic scheduling policies for hybrid make-to-order and make-to-stock production systems with stochastic demand

We examine the previously under-researched problem of scheduling a single stage, capacitated, hybrid make-to-order (MTO) and make-to-stock (MTS) production system with stochastic demand. We build on the Economic Lot Scheduling Problem (ELSP) literature and make some modifications to incorporate MTO products. At the tactical level, target cycles (kept long enough to trade-off changeover and inventory costs) are calculated while at the operational level, the general idea is to try and follow these target cycles, and make adjustments to them in order to (a) avoid stock-outs for NITS products and, (b) have short lead-time for MTO products while keeping the overall costs as low as possible. Through an extensive simulation study, we evaluate various run-out time scheduling and sequencing heuristics and provide a more complete understanding and managerial insights in the case of hybrid MTO-MTS environment with stochastic demand. It is clear that the methods that perform well for pure MTS situations do not necessarily perform well for hybrid MTO-MTS situation. (c) 2004 Elsevier B.V. All rights reserved

Combined make-to-order and make-to-stock in a food production system

The research into multi-product production/inventory control systems has mainly assumed one of the two strategies: Make-to-Order (MTO) or Make-to-Stock (MTS). In practice, however, many companies cater to an increasing variety of products with varying logistical demands (e.g. short due dates, specific products) and production characteristics (e.g. capacity usage, setup) to different market segments and so they are moving to more MTO-production. As a consequence they operate under a hybrid MTO-MTS strategy. Important issues arising out of such situations are, for example, which products should be manufactured to stock and which ones on order and, how to allocate capacity among various MTO-MTS products. This paper presents the state-of-the-art literature review of the combined MTO-MTS production situations. A variety of production management issues in the context of food processing companies, where combined MTO-MTS production is quite common, are discussed in details. The authors propose a comprehensive hierarchical planning framework that covers the important production management decisions to serve as a starting point for evaluation and further research on the planning system for MTO-MTS situations.