Order-Fulfillment Performance Measures in an Assemble-to-Order System with Stochastic Leadtimes

Jing-Sheng Song · Susan H. Xu · Bin Liu

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Supply Chain and Inventory Management Management and Optimization Techniques Advanced Queuing Theory Analysis

Abstract

We study a multicomponent, multiproduct production and inventory system in which individual components are made to stock but final products are assembled to customer orders. Each component is produced by an independent production facility with finite capacity, and the component inventory is controlled by an independent base-stock policy. For any given base-stock policy, we derive the key performance measures, including the probability of fulfilling a customer order within any specified time window. Computational procedures and numerical examples are also presented. A similar approach applies to the generic multi-item make-to-stock inventory systems in which a typical customer order consists of a kit of items.

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References

2000Foundations of Inventory Management 1984Matrix-Geometric Solutions to Stochastic Models 1993Material Management in Decentralized Supply Chains 1984Two Parallel Queues Created by Arrivals with Two Demands I 1992The Role of Inventory in Delivery-Time Competition

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2018A typology and literature review on stochastic multi-echelon inventory models 2006An integrated production and inventory model to dampen upstream demand variability in the supply chain 2002Performance Analysis and Optimization of Assemble-to-Order Systems with Random Lead Times 2008Modeling and analysis of build-to-order supply chains 2003Order Fill Rate, Leadtime Variability, and Advance Demand Information in an Assemble-to-Order System 2002Inventory-Service Optimization in Configure-to-Order Systems 1998Leadtime-Inventory Trade-Offs in Assemble-to-Order Systems 2004Joint Inventory Replenishment and Component Allocation Optimization in an Assemble-to-Order System

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