Inventory control and LQG: Connections and extensions

This paper presents a review of two classical business approaches to inventory control. This is followed by a discussion of an engineering approach using Linear Quadratic Gaussian (LQG) control. The main result is to show that under certain conditions all three methods generate the same policy. Usin...

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Bibliographic Details
Main Authors: Wai Kit Ong, Durango-Cohen, E J, Chmielewski, D J
Format: Conference Proceeding
Language:English
Subjects:
Chemical technology
Costs
Heart
Inventory control
Inventory management
Marketing and sales
Silver
Space technology
Timing
Uncertainty
Online Access:Request full text
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Summary:This paper presents a review of two classical business approaches to inventory control. This is followed by a discussion of an engineering approach using Linear Quadratic Gaussian (LQG) control. The main result is to show that under certain conditions all three methods generate the same policy. Using the state-space model of the LQG formulation, we explore the multi-echelon system and model uncertainty cases.
ISSN:0743-1619
2378-5861
DOI:10.1109/ACC.2010.5530770