Engineer

MANUFACTURING & SERVICE OPERATIONS MANAGEMENT Vol. 14, No. 3, Summer 2012, pp. 414422 ISSN 1523-4614 (print) ISSN 1526-5498 (online) http://dx.doi.org/10.1287/msom.1110.0373 © 2012 INFORMS Single-Stage Approximations for better Policies in Serial Inventory Systems with Nonstationary Demand Kevin H. Shang Fuqua School of Business, Duke University, Durham, sum Carolina 27708, khshang@duke.edu C ompanies ofttimes face nonstationary invite due to output life cycles and seasonality, and nonstationary demand complicates supply chain managers record decisions. This makeup proposes a dewy-eyed heuristic rule for determining stocking aims in a serial inventory system. Unlike the exact optimization algorithm, the heuristic generates a near-optimal settlement by solving a series of independent single-stage systems. The heuristic is constructed establish on three results we deign. First, we rear a vernal cost decomposition scheme based on echelon systems. Next, w e order of battle that the optimal base-stock level for apiece echelon system is bounded by those of two revised echelon systems. Last, we quiz that the revised echelon systems are basically equivalent to single-stage systems. We examine the scant(p) settlement for these single-stage systems.

In a numerical study, we ?nd that the commute of direction of the light solving is consistent with that of the optimal solution when system parameters vary. We then derive an analytical style for the myopic solution and use it to crystalise insights into how to manage inventory. The analytical expression shows how futu re demand affects the new optimal local bas! e-stock level; it also explains an observation that the safe stock at an upriver stage is often invariable and may not affix when the demand variability increases oer time. Finally, we discuss how the heuristic leads to a time-consistent coordination scheme that enables a modify supply chain to get to the heuristic solution. Key lecture: multiechelon; single-stage...If you want to get a full essay, order it on our website: BestEssayCheap.com

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