A General Decomposition Algorithm for Parallel Queues with Correlated Arrivals
Queueing Systems: Theory and Applications
A bi-criteria model for the inventory aggregation problem under risk pooling
Computers and Industrial Engineering
Optimal Control of a High-Volume Assemble-to-Order System
Mathematics of Operations Research
Discrete Optimization via Simulation Using COMPASS
Operations Research
Queueing Systems: Theory and Applications
A Lagrangian based solution algorithm for a build-to-order supply chain network design problem
Advances in Engineering Software
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This paper studies the trade-off between inventory levels and the delivery leadtime offered to customers in achieving a target level of service. It addresses the question of how much a delivery leadtime can be reduced, per unit increase in inventory, at a fixed fill rate. We show that for a class of assemble-to-order models with stochastic demands and production intervals there is a simple linear trade-off between inventory and delivery leadtime, in a limiting sense, at high fill rates. The limiting slope is easy to calculate and can be interpreted as the approximate marginal rate for trading off inventory against leadtime at a constant level of service. We also investigate how various model features affect the trade-off-in particular, the impact of orders for multiple units of a single item and of orders for multiple units of different items.