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MATERIAL REQUIREMENTS PLANNING UNDER UNCERTAINTY

MATERIAL REQUIREMENTS PLANNING UNDER UNCERTAINTY ABSTRACT This paper presents a framework for characterizing and studying the uncertainty which can affect inventory investment and service level performance in a material requirements planning (MRP) system. It also presents the results of a simulation experiment which compared two techniques (safety stock and safety lead time) for building inventory to protect against uncertainty. The simulation results disclose consistent differences between the techniques in protecting a representative part against timing and quantity uncertainty in both demand and supply for the part. The paper not only provides some initial insights into the behavior of MRP systems under uncertainty, but also establishes some guidelines for choosing between safety stock and safety lead time. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Decision Sciences Wiley

MATERIAL REQUIREMENTS PLANNING UNDER UNCERTAINTY

Decision Sciences , Volume 7 (4) – Oct 1, 1976

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References (5)

Publisher
Wiley
Copyright
Copyright © 1976 Wiley Subscription Services, Inc., A Wiley Company
ISSN
0011-7315
eISSN
1540-5915
DOI
10.1111/j.1540-5915.1976.tb00704.x
Publisher site
See Article on Publisher Site

Abstract

ABSTRACT This paper presents a framework for characterizing and studying the uncertainty which can affect inventory investment and service level performance in a material requirements planning (MRP) system. It also presents the results of a simulation experiment which compared two techniques (safety stock and safety lead time) for building inventory to protect against uncertainty. The simulation results disclose consistent differences between the techniques in protecting a representative part against timing and quantity uncertainty in both demand and supply for the part. The paper not only provides some initial insights into the behavior of MRP systems under uncertainty, but also establishes some guidelines for choosing between safety stock and safety lead time.

Journal

Decision SciencesWiley

Published: Oct 1, 1976

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