Analysis of a Standing Order Inventory System with Emergency Orders

The advent of relatively sophisticated information systems has made it possible for many businesses that keep inventories to know their needs very rapidly. However, the producers of these inventories have not all made comparable advances in scheduling production to meet the rapidly changing orders p...

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Bibliographic Details
Published in:Operations research 1976-11, Vol.24 (6), p.1143-1155
Main Authors: Rosenshine, Matthew, Obee, Duncan
Format: Article
Language:English
Subjects:
Business orders
Cost efficiency
Economic systems
Inventories
Inventory control
Minimization of cost
Operations research
Orders
Purchasing
Scheduling
Total costs
Unit costs
Variable costs
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Summary:The advent of relatively sophisticated information systems has made it possible for many businesses that keep inventories to know their needs very rapidly. However, the producers of these inventories have not all made comparable advances in scheduling production to meet the rapidly changing orders placed by their increasingly sophisticated customers. As a result, leadtimes have been growing rather than decreasing. Since in most cases the company needing the inventory cannot control the leadtime, it must either accept it or look for ways to mitigate its effect. This paper evaluates one way to cope with the problem of large or growing leadtimes.
ISSN:0030-364X
1526-5463
DOI:10.1287/opre.24.6.1143