Abstract
We consider the (D, 0) inventory model, where the demand per unit time, D, is stationary and independently and identically distributed (iid) and the lead time, L, is deterministic. In the case of the re-order point, order quantity (s, Q) system, where the cost function is convex in s and Q, this yields two equations that are solved iteratively to yield the optimal policy. The question that we address here concerns the effect of the variability in lead time demand on the total cost and the policy parameters. Simply stated: given other parameters, such as ordering, holding, and shortage costs, can we write the optimal total cost and the policy parameters as linear or quadratic functions of the standard deviation of demand during lead time?
| Original language | English (US) |
|---|---|
| Pages (from-to) | 2767-2783 |
| Number of pages | 17 |
| Journal | International Journal of Production Research |
| Volume | 47 |
| Issue number | 10 |
| DOIs | |
| State | Published - Jan 1 2009 |
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All Science Journal Classification (ASJC) codes
- Strategy and Management
- Management Science and Operations Research
- Industrial and Manufacturing Engineering
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Exploring the structural properties of the (D, 0) inventory model. / Hayya, Jack C.; Harrison, Terry Paul; Chatfield, Dean C.
In: International Journal of Production Research, Vol. 47, No. 10, 01.01.2009, p. 2767-2783.Research output: Contribution to journal › Article
TY - JOUR
T1 - Exploring the structural properties of the (D, 0) inventory model
AU - Hayya, Jack C.
AU - Harrison, Terry Paul
AU - Chatfield, Dean C.
PY - 2009/1/1
Y1 - 2009/1/1
N2 - We consider the (D, 0) inventory model, where the demand per unit time, D, is stationary and independently and identically distributed (iid) and the lead time, L, is deterministic. In the case of the re-order point, order quantity (s, Q) system, where the cost function is convex in s and Q, this yields two equations that are solved iteratively to yield the optimal policy. The question that we address here concerns the effect of the variability in lead time demand on the total cost and the policy parameters. Simply stated: given other parameters, such as ordering, holding, and shortage costs, can we write the optimal total cost and the policy parameters as linear or quadratic functions of the standard deviation of demand during lead time?
AB - We consider the (D, 0) inventory model, where the demand per unit time, D, is stationary and independently and identically distributed (iid) and the lead time, L, is deterministic. In the case of the re-order point, order quantity (s, Q) system, where the cost function is convex in s and Q, this yields two equations that are solved iteratively to yield the optimal policy. The question that we address here concerns the effect of the variability in lead time demand on the total cost and the policy parameters. Simply stated: given other parameters, such as ordering, holding, and shortage costs, can we write the optimal total cost and the policy parameters as linear or quadratic functions of the standard deviation of demand during lead time?
UR - http://www.scopus.com/inward/record.url?scp=70449604831&partnerID=8YFLogxK
UR - http://www.scopus.com/inward/citedby.url?scp=70449604831&partnerID=8YFLogxK
U2 - 10.1080/00207540701749299
DO - 10.1080/00207540701749299
M3 - Article
AN - SCOPUS:70449604831
VL - 47
SP - 2767
EP - 2783
JO - International Journal of Production Research
JF - International Journal of Production Research
SN - 0020-7543
IS - 10
ER -