IDEAS home Printed from https://ideas.repec.org/a/taf/tprsxx/v57y2019i6p1892-1913.html
   My bibliography  Save this article

Effect of limited capacity on optimal planning parameters for a multi-item production system with setup times and advance demand information

Author

Listed:
  • Klaus Altendorfer

Abstract

An analytical production/inventory model to optimise the planning parameters lot-size, safety stock and planned lead time is developed for a stochastic single-stage production system with multiple items and limited capacity. Based on queuing analysis, the influence of item specific lot-sizes on the production lead time distribution is modelled. Applying stochastic advance demand information, the expected values for finished-goods-inventory, backorders and service level are explicitly stated. Numerical optimisation is applied to solve the respective cost minimisation problem and a solution heuristic is developed to support this approach. A numerical study provides managerial insights concerning capacity limitation effects on the optimal planning parameters. Higher shop loads, i.e. tighter capacity constraints, are found to significantly increase optimal lot-size and optimal safety stock. Safety stock and planned lead time are substitutes, an increase of both leads to higher FGI and lower backorders, however, the specific trade-off depends on the demand information quality. A sensitivity analysis investigating other (non-) financial system parameters is conducted as well. The main contribution of this paper is that the interaction of different planning parameters, i.e. lot-size, safety stock and planned lead time, for different items is simultaneously studied for a capacity constrained production/inventory system.

Suggested Citation

  • Klaus Altendorfer, 2019. "Effect of limited capacity on optimal planning parameters for a multi-item production system with setup times and advance demand information," International Journal of Production Research, Taylor & Francis Journals, vol. 57(6), pages 1892-1913, March.
    • Handle: RePEc:taf:tprsxx:v:57:y:2019:i:6:p:1892-1913
    DOI: 10.1080/00207543.2018.1511925
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/00207543.2018.1511925
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/00207543.2018.1511925?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Balwin Bokor & Wolfgang Seiringer & Klaus Altendorfer & Thomas Felberbauer, 2024. "Energy Price and Workload Related Dispatching Rule: Balancing Energy and Production Logistics Costs," Papers 2405.02445, arXiv.org, revised Sep 2024.
    2. Barros, Júlio & Cortez, Paulo & Carvalho, M. Sameiro, 2021. "A systematic literature review about dimensioning safety stock under uncertainties and risks in the procurement process," Operations Research Perspectives, Elsevier, vol. 8(C).
    3. Mikhail Y. Kovalyov & Mikhail N. Lukashevich & Erwin Pesch, 2023. "Cost minimizing planning of container inspection and repair in multiple facilities," OR Spectrum: Quantitative Approaches in Management, Springer;Gesellschaft für Operations Research e.V., vol. 45(1), pages 181-204, March.
    4. Gonçalves, João N.C. & Sameiro Carvalho, M. & Cortez, Paulo, 2020. "Operations research models and methods for safety stock determination: A review," Operations Research Perspectives, Elsevier, vol. 7(C).
    5. Wolfgang Seiringer & Balwin Bokor & Klaus Altendorfer, 2024. "Evaluating Production Planning and Control Systems in Different Environments: A Comparative Simulation Study," Papers 2405.02015, arXiv.org, revised Sep 2024.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:tprsxx:v:57:y:2019:i:6:p:1892-1913. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/TPRS20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.