Management of a high mix production system with interdependent demands : simulation of proposed policies

The finished goods inventory management in the accessories area of a material testing company is complex. There is interdependence between the demands of products and they can be sold both as part of systems and as individual after sales items. Besides, there is uncertainty in determining replenishment lead times. An optimization problem is formulated considering customer satisfaction, inventory holding costs and correlation between demands. To ascertain its validity, a discrete event simulation is executed over historical demand. Simulation also helps to check the solution robustness by executing the proposed inventory levels over statistically generated demands. The result provides the right mix of finished products which should be stored on the shelves. 90% reduction in lost sales and 35% in inventory value on hand have been projected. The results have been further implemented at the part level inventory.

Department dc:contributor.department

Massachusetts Institute of Technology. Dept. of Mechanical Engineering.

Grantor dc:publisher

Massachusetts Institute of Technology

Year dc:date.issued

2009

Author dc:creator

• Chugh, Samarth

Advisor dc:contributor.advisor

• Stanley B. Gershwin.

• Mechanical Engineering.

Statement dc:rights

• M.I.T. theses are protected by copyright. They may be viewed from this source for any purpose, but reproduction or distribution in any format is prohibited without written permission. See provided URL for inquiries about permission.

Licence dc:rights.uri

• http://dspace.mit.edu/handle/1721.1/7582

Language dc:language.iso

eng

Handle dc:identifier.uri

http://hdl.handle.net/1721.1/54870

OAI identifier oai:identifier

oai:dspace.mit.edu:1721.1/54870