A Dynamic Model for Requirements Planning with Application to Supply Chain Optimization

Authors:
Stephen C. Graves;David B. Kletter;William B. Hetzel
Affiliations:
-;-;-
Venue:
Operations Research
Year:
1998

Citing 0
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Abstract

This paper develops a new model for studying requirements planning in multistage production-inventory systems. We first characterize how most industrial planning systems work, and we then develop a mathematical model to capture some of the key dynamics in the planning process. Our approach is to use a model for a single production stage as a building block for modeling a network of stages. We show how to analyze the single-stage model to determine the production smoothness and stability for a production stage and the inventory requirements. We also show how to optimize the tradeoff between production capacity and inventory for a single stage. We then can model the multistage supply chain using the single stage as a building block. We illustrate the multistage model with an industrial application, and we conclude with some thoughts on a research agenda.