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Capacity-constrained production-inventory systems: modelling and analysis in both a traditional and an e-business context
Linköping University, Department of Computer and Information Science. Linköping University, The Institute of Technology.
2004 (English)Doctoral thesis, comprehensive summary (Other academic)
Abstract [en]

This thesis addresses issues in production-inventory systems in both a traditional and an e-business context, with an emphasis on capacity considerations. The general aim of the thesis is to model capacity-constrained production-inventory systems and thereby provide theoretical frameworks for control as well as design of these systems.

The research has been conducted in two different contexts. In the traditional context, an extensive survey of the literature on capacity-constrained production-inventory systems is first presented. Production-inventory systems with capacity limitations are then modelled using the Laplace transform and input-output analysis for deterministic and stochastic demand situations, respectively. In the formulation of the model for the deterministic demand situations, the focus is on the way in which the fundamental balance equations for inventory and backlogs need to be modified. In the formulation for stochastic demand situations, the model extends previous theory in the direction of capacity considerations combined with uncertainty in external demand. The results of the modelling and analysis in the traditional context contribute to the development of a theoretical background for production-inventory system control applying the Laplace transform approach and input-output analysis.

In the e-business context, those aspects which are affected by e-business based customer ordering systems, and hence influence production-inventory systems, are studied. A mathematical model based on the assumption of a simple e-business model of direct sales channels is presented. Since e-business significantly facilitates customisation, models of two different production systems which consider customisation are provided. The production-inventory systems are then developed into an extended system where customers are included. For this system, a multiple objective formulation is obtained, in view of the importance of customers. The results of the modelling and analysis in the ebusiness context contribute insights and perspectives on ways to design and control ebusiness influenced production - inventory systems.

Place, publisher, year, edition, pages
Linköping, Sweden: Linköpings universitet , 2004. , 34 p.
Series
Linköping Studies in Science and Technology. Dissertations, ISSN 0345-7524 ; 889Dissertation from the Swedish Research School of Management and Information Technology (MIT). Dissertation, 2
National Category
Computer Science
Identifiers
URN: urn:nbn:se:liu:diva-23761Local ID: 3275ISBN: 91-8529-508-6 (print)OAI: oai:DiVA.org:liu-23761DiVA: diva2:244076
Public defence
2004-11-05, Visionen, Hus B, Campus Valla, Linköping, 10:15 (Swedish)
Available from: 2009-10-07 Created: 2009-10-07 Last updated: 2012-12-13Bibliographically approved
List of papers
1. Modelling capacity-constrained production-inventory systems: a review
Open this publication in new window or tab >>Modelling capacity-constrained production-inventory systems: a review
2000 (English)In: Proceedings of the 11th International Working Seminar on Production Economics, Vol. 1, 2000, 99-105 p.Conference paper, Published paper (Refereed)
Abstract [en]

This paper presents a survey of the current literature on capacity-constrained production-inventory problems in the MRP context. Research work within both the deterministic and stochastic environments are summarised. Certain aspects related to model formulation are also discussed. Our aim is to give a generalunderstanding of the capacitated lot-sizing problem rather than a comprehensive literature study. The literature covered is mostly since 1980. A basic aim is also to create a background to generalisations of theoretical developments on material requirements planning applying input-output analysis and Laplace transforms.

National Category
Engineering and Technology
Identifiers
urn:nbn:se:liu:diva-86330 (URN)
Conference
11th International Working Seminar on Production Economics, 21-25 February, Igls, Austria
Available from: 2012-12-13 Created: 2012-12-13 Last updated: 2015-02-09
2. Ideas for introducing capacity planning into MRP applying input-output analysis and Laplace transforms
Open this publication in new window or tab >>Ideas for introducing capacity planning into MRP applying input-output analysis and Laplace transforms
2001 (English)In: Promet - Traffic - Traffico, ISSN 0353-5320, Vol. 13, no 6, 371-377 p.Article in journal (Refereed) Published
Abstract [en]

Laplace transform and input-output analysis have been used to formulate a theoretical basis for Material Requirements Planning (MRP) system. In this paper, we will formulate a model for capacity-constrained production-inventory system applying Laplace transform and input-output analysis, which is different from the classical method of handling the capacity problem.

Keyword
MRP, Input-output analysis, Laplace transform, Capacity-constrained, Production-inventory system
National Category
Engineering and Technology
Identifiers
urn:nbn:se:liu:diva-86331 (URN)
Available from: 2012-12-13 Created: 2012-12-13 Last updated: 2012-12-13
3. Introducing capacity limitations into multi-level, multi-stage production-inventory systems applying the input-output/Laplace transform approach
Open this publication in new window or tab >>Introducing capacity limitations into multi-level, multi-stage production-inventory systems applying the input-output/Laplace transform approach
2000 (English)In: International Journal of Production Research, ISSN 0020-7543, E-ISSN 1366-588X, Vol. 38, no 17, 4227-4234 p.Article in journal (Refereed) Published
Abstract [en]

The Laplace transform and Input-Output Analysis have been used to formulate a theoretical basis for Material Requirements Planning (MRP). In this paper, as a first step to incorporating capacity limitations into this theory, we introduce alternative formulations of a model for capacity-constrained production-inventory systems in a deterministic environment applying the same approach. We focus our attention on the way in which the balance equations constraining the system need to be modified. A numerical example is given to explain the model.

National Category
Engineering and Technology
Identifiers
urn:nbn:se:liu:diva-49492 (URN)10.1080/00207540050205046 (DOI)
Available from: 2009-10-11 Created: 2009-10-11 Last updated: 2017-12-12
4. A stochastic model of multi-level/multi-stage capacity-constrained production–inventory systems
Open this publication in new window or tab >>A stochastic model of multi-level/multi-stage capacity-constrained production–inventory systems
2003 (English)In: International Journal of Production Economics, ISSN 0925-5273, E-ISSN 1873-7579, Vol. 81-82, 483-494 p.Article in journal (Refereed) Published
Abstract [en]

A great deal of research has been done on capacity-constrained production–inventory systems, most of which concerns deterministic demand situations and single-product systems. In this paper we present a model of a multi-level capacity-constrained system when external demand is stochastic. Unlike the traditional total cost objective, adopted in the vast majority of capacity-constrained production–inventory models, the (expected) Net Present Value is here used as the objective function. Dynamic programming is chosen as the solution procedure. Numerical examples are given to explain the model and to illustrate features when changing available capacity.

The Laplace transform together with input–output analysis are employed as tools to construct the model. This approach has been used in previous research to formulate a theoretical base for Material Requirements Planning (MRP) systems.

The paper provides a further argument for the use of transforms in combination with matrix representations of product structures and capacity requirements, and it extends previous theory in the direction of capacity considerations combined with uncertainty in external demand. Dynamic programming is also shown to be a practical method for the multi-stage optimisation involved.

The numerical examples further illustrate, for instance, the natural propensity for subordinate items to be lot sized in a more lumpy way than their parents, and also how the marginal benefit of capacity increments follows the law of diminishing returns. Also comparisons are made with solutions from the deterministic equivalence model, using average demand as a proxy.

Keyword
Capacity constraints, Input-output analysis, Laplace transform, Material requirements planning, Stochastic demand
National Category
Engineering and Technology
Identifiers
urn:nbn:se:liu:diva-46750 (URN)10.1016/S0925-5273(02)00358-4 (DOI)
Available from: 2009-10-11 Created: 2009-10-11 Last updated: 2017-12-13
5. The impact of e-business based customer ordering systems on traditional production-inventory systems
Open this publication in new window or tab >>The impact of e-business based customer ordering systems on traditional production-inventory systems
(English)Manuscript (preprint) (Other academic)
Abstract [en]

E-business is developing very rapidly as a new way of working. It brings some advantages for production-inventory management. Despite its great impact, research on the influence of e-business on production-inventory systems is very rare. In this paper, we first study those aspects which are affected by e-business-based customer ordering systems and then influence production-inventory systems. A mathematic model is then presented based on an assumption of simple e-business model of direct sales channel. Discussions are given on issues related to the system.

National Category
Engineering and Technology
Identifiers
urn:nbn:se:liu:diva-86332 (URN)
Available from: 2012-12-13 Created: 2012-12-13 Last updated: 2012-12-13
6. Modelling customisation in production-inventory systems
Open this publication in new window or tab >>Modelling customisation in production-inventory systems
2004 (English)In: Proceedings of the 2nd World POM Conference, 2004Conference paper, Published paper (Other academic)
Abstract [en]

With the implementation of e-business, customisation is increasingly becoming a competitive strategy for manufacturing companies. From both theoretical and practical perspectives, however, there is limited knowledge about the influence of customisation on the operational level. In this paper, we model two different production systems: the single machine production system with a cyclical production policy and the serial production system with a decoupling point, where customisation is considered. These models provide a theoretical framework for designing a production-inventory system in practice. As for the solutions yielded by the models, the most interesting finding is that capacity requirement increases with customer order lead-time in the serial production system in one of the cases’ solutions, which is counterintuitive. This result is due to the complexity of the relationship between the variables of decoupling point position and capacity requirements and the parameter of customer order leadtime in the mathematical formulation.

Keyword
e-business, customisation, production-inventory system, capacity requirements, decoupling point, lead-time
National Category
Computer Science
Identifiers
urn:nbn:se:liu:diva-23760 (URN)3274 (Local ID)3274 (Archive number)3274 (OAI)
Conference
Second World Conference on POM and 15th Annual POM Conference, Cancun, Mexico, April 30 - May 3, 2004
Available from: 2009-10-07 Created: 2009-10-07 Last updated: 2012-12-13
7. An extended production-inventory system and its modelling
Open this publication in new window or tab >>An extended production-inventory system and its modelling
(English)Manuscript (preprint) (Other academic)
Abstract [en]

With today's global competitive environment and changing customer requirements, companies are nowadays shifting from product-oriented to customer-oriented production. In this paper, we introduce the concept of an "extended production-inventory system". The concept means that customers are included as a part of production-inventory systems; this could be regarded as an extreme case of customer-oriented manufacturing. Based on that concept, a simple extended productioninventory system is presented. In the system, the objectives of both manufacturer and customer are considered simultaneously, and it is shown how the system can be mathematically modelled applyingmultiple-objective decision-making techniques. Moreover, a numerical example is provided to illustrate how the weights of different objectives influence the optimal solutions. The strategy of customisation, facilitated by e-business, is incorporated in the model as well.

National Category
Engineering and Technology
Identifiers
urn:nbn:se:liu:diva-86337 (URN)
Available from: 2012-12-13 Created: 2012-12-13 Last updated: 2012-12-13

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