The impact of "Never Run Out" policy assured supply chain with dual reorder point expediting
Name
304398256-MIT.pdf
Description
Full printable version
Size
26.63 MB
Format
Adobe PDF
Checksum (MD5)
09a96e21ed2442648d13a3f4ddbd045a
Author(s)
Lee, Gil Su
Advisor(s)
Chris Caplice.
Date Issued
2008
Publisher
Massachusetts Institute of Technology
Abstract
Managing a big supply chain for one of the largest quick service restaurant companies, especially when the company has a policy called "Never Run Out," is very challenging. A traditional way of managing inventory requires high level of safety stock if high level of uncertainty is involved. Sources of uncertainty include variability in demand from frequent promotions or seasonal effect, variability in order lead time from using low-cost mode of transportation, or lack of information sharing. This project developed an expediting policy with dual reorder points with demand threshold and tested the policy with a Monte Carlo simulation. Previous research on two reorder points provide great foundation for this study but they lack consideration on demand variability and approaches to set up reorder points. We propose an algorithm with a demand threshold to trigger an expedited order and heuristic approaches to develop reorder points where the total cost can be minimized while service requirements are met.
Description
Thesis (M. Eng. in Logistics)--Massachusetts Institute of Technology, Engineering Systems Division, 2008.
Includes bibliographical references (leaves 64-65).
Subjects
Engineering Systems Division.
MIT Department
Massachusetts Institute of Technology. Engineering Systems Division
Terms of Use
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.
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.
Persistent DSpace Link
