Analysis of form postponement based on optimal positioning of the differentiation point and stocking decisions

Hartanto Wong · Joakim Wikner · Mohamed Mohamed Naim

38 citations0/0 files storedInternational Journal of Production Research

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Supply Chain and Inventory Management Management and Optimization Techniques Product Development and Customization

Abstract

In this paper we analyse the use of form postponement based on the positioning of the differentiation point and stocking policy. Six classes of manufacturing configurations are identified based on the choice of whether or not form postponement is employed and the decision regarding the stocking policy for the final product configurations as well as for the generic component. Analytical evaluation methods based on queuing models are used to assess operational measures for each class of configuration and solution algorithms are developed to determine the optimal positioning of the differentiation point and the optimal stocking levels. This allows us to compare the relative merits of all manufacturing configurations based on their respective best performances. The results of a numerical experiment show how different operational parameters may influence the choice of optimal configuration, the preference of early or late postponement, and the relative cost savings obtained from employing form postponement.

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References

2018Journal of Business Logistics 1974Logistical Management: The Integrated Supply Chain Process 1997Modelling the Costs and Benefits of Delayed Product Differentiation 1998Supply Chain Postponement and Speculation Strategies: How to choose the right strategy 2001The rediscovery of postponement a literature review and directions for research 1993Hewlett-Packard Gains Control of Inventory and Service through Design for Localization 1998Managing Broader Product Lines through Delayed Differentiation Using Vanilla Boxes 1988PLANNING PHYSICAL DISTRIBUTION WITH THE PRINCIPLE OF POSTPONEMENT

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2018Supply chain antecedents of agile manufacturing in a developing country context 2013An integrated operations-marketing perspective for making decisions about order penetration point in multi-product supply chain: a queuing approach 2011A structural approach to assessing postponement strategies: construct development and validation 2020Demand-driven supply chain operations management strategies – a literature review and conceptual model 2014Analyzing Single and Multiple Customer Order Decoupling Point Positioning based on Customer Value: A Multi-objective Approach

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