Delivery optimization for a make to order custom wire mill

Abstract

In the face of growing competition in the Tantalum business, H.C.Starck's management is minimizing the delivery time for custom-made capacitor-grade tantalum wire products. H.C. Starck, Inc., Newton, Massachusetts faces challenges in its production environment to meet customer demand in an effective manner. Specific challenges include poor forecasting abilities, variation in customer demand, long component lead time, and expensive components. For this study, the desired delivery time reduction is to be achieved by establishing intermediate inventory buffers, setting appropriate inventory targets in an order-up-to-level inventory management model that considers sources of variation, time requirements, and customer service goals. We addressed a number of goals. First, we tied demand variability into traditional demand- focused models. Second, we develop more standardized and simplified inventory targets. Finally, we develop a production scheduling system that smoothes production, simplifies the scheduling process, and helps in achieving desired customer service level and the inventory targets.