Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
9663846 | European Journal of Operational Research | 2005 | 11 Pages |
Abstract
Variability, in general, has a deteriorating effect on the performance of stochastic inventory systems. In particular, previous results indicate that demand variability causes a performance degradation in terms of inventory related costs when production capacity is unlimited. In order to investigate the effects of demand variability in capacitated production settings, we analyze a make-to-stock queue with general demand arrival times operated according to a base-stock policy. We show that when demand inter-arrival distributions are ordered in a stochastic sense, increased arrival time variability indeed leads to an augmentation of optimal base-stock levels and to a corresponding increase in optimal inventory related costs. We quantify these effects through several numerical examples.
Related Topics
Physical Sciences and Engineering
Computer Science
Computer Science (General)
Authors
Zied JemaıÌ, Fikri Karaesmen,