No abstract

This research examines the effectiveness of alternative strategies for dealing with the problem of order instability, or nervousness, which occurs in Material Requirements Planning systems. Nervousness can be particularly disruptive in multi-level production processes where a change in order size or timing at one level can result in changes at other levels. This study proposes and evaluates five different strategies for treating nervousness caused by the interaction of lot-sizing decisions and the planning horizon. Not evaluated here are the effects on order instability caused by demand uncertainty or supply and lead-time uncertainty. The five strategies examined are: (1) Freezing the schedule within the planning horizon, (2) Lot-for-Lot after stage 1, (3) Safety stocks, (4) Forecast beyond the planning horizon, and (5) Change cost procedure. A series of simulation experiments was conducted to test the effectiveness of the five strategies on schedule stability and system costs. The experiments were constructed to evaluate the impacts of various lot-sizing methods, the length of the planning horizon, setup and holding cost parameters and product assembly structure. The results indicate that when the source of nervousness is due to changes in decisions caused by a rolling planning horizon, safety stock and lot-for-lot approaches are not cost effective. Under most conditions, the strategies of incorporating a change cost to discourage schedule changes or freezing the schedule within the planning horizon appear to be dominant.inventory/production: operating characteristics, inventory/production: simulation, inventory/production: planning horizons

The Wagner-Whitin dynamic economic lot-sizing technique has not been widely applied to real-world production scheduling problems. A frequently quoted reason is the extreme sensitivity of the solution to changes in the estimates of future values of the problem's parameters, especially future demand. This "nervousness" has been of great concern to users of MRP (Material Requirements Planning) systems. A solution procedure which incorporates the cost of changing the current production schedule alleviates this nervousness by considering its economic effect. Thus updated parameter forecasts can be effectively used, and the schedule will be changed only when the joint consideration of setup, inventory holding, and schedule change costs indicates that it is economically beneficial to do so.material requirements planning, material requirements planning: lot sizing

This paper investigates optimal lot-splitting policies in a multiprocess flow shop environment with the objective of minimizing either mean flow time or makespan. Using a quadratic programming approach to the mean flow time problem, we determine the optimal way of splitting a job into smaller sublots under various setup times to run time ratios, number of machines in the flow shop, and number of allowed sublots. Our results come from a deterministic flow shop environment, but also provide insights into the repetitive lots scheme using equal lot splits for job shop scheduling in a stochastic environment. We indicate those conditions in which managers should implement the repetitive lots scheme and where other lot-splitting schemes should work better.