chapter12b

chapter12b - 12-1Operations Operations...

Info iconThis preview shows pages 1–10. Sign up to view the full content.

View Full Document Right Arrow Icon

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: 12-1Operations Operations ManagementManagementInventory ManagementInventory ManagementChapter 12 - Part 2Chapter 12 - Part 212-2OutlineOutlineFunctions of Inventory.ABC Analysis.Inventory Costs. Inventory Models for Independent Demand.Economic Order Quantity (EOQ) Model.Production Order Quantity (POQ) Model.Quantity Discount Models.Probabilistic Models for Varying Demand.Fixed Period Systems.12-3Material is not received instantaneously.For example, it is produced in-house.Other EOQ assumptions apply.Model provides production lot size(like EOQ amount) for one product.Similar to EOQ with setupcost rather than ordercost.Production Order Quantity ModelProduction Order Quantity Model12-4Consider one productat a time.Produce Qunits in a production run; then switch and produce other products.Later produce Qmore units in 2nd production run (Qunits of product of interest).Later produce Qmore units in 3rd production run, etc. Production Order Quantity ModelProduction Order Quantity Model12-5POQ Model Inventory LevelsPOQ Model Inventory LevelsInventory LeveInventory LevellTimeTimeProduction Production BeginsBeginsProduction Production Run EndsRun EndsProduction portion of cycleProduction portion of cycleDemand portion of cycle with no Demand portion of cycle with no production (of this product)production (of this product)12-6POQ Model Inventory LevelsPOQ Model Inventory LevelsInventory LeveInventory LevellTimeTimeProduction Production BeginsBeginsProduction Production Run EndsRun EndsProduction rate = p = 20/dayDemand rate = d= 7/daySlope = -d = -7/daySlope = p-d = 13/dayNote: Not all of production goes into inventory12-7POQ Model Inventory LevelsPOQ Model Inventory LevelsInventory LeveInventory LevellTimeTimeProduction Production BeginsBeginsProduction Production Run EndsRun EndsProduction rate = p = 20/dayDemand rate = d= 7/daySlope = -d = -7/dayInventory decreases by 7/day after producingSlope = p-d = 13/dayInventory increases by 13 each day while producingNote: 1-(d/p) = fraction of production that goes into inventory12-8Number of Production Runs per year=DQD= Annual demand (relatively constant)= Annual demand (relatively constant)S= Setup cost per setup= Setup cost per setupH= Holding (carrying) cost per unit per year= Holding (carrying) cost per unit per yeard= Demand rate (units per day, units per week, etc.)= Demand rate (units per day, units per week, etc.)p= Production rate (units per day, units per week, etc.)= Production rate (units per day, units per week, etc.)Determine: QDetermine: Q= Production run size (number of items per production run)= Production run size (number of items per production run)POQ Model Equations POQ Model Equations Setup Cost per year=SDQHolding Cost per year=(average inventory level) HGiven12-9POQ Model Inventory LevelsPOQ Model Inventory LevelsTimeTimeInventory LevelInventory LevelProduction Production Portion of CyclePortion of CycleMaximum Inventory Maximum Inventory = Q(1-(d/p))= Q(1-(d/p))Demand portion of cycle with no supply12-10...
View Full Document

This note was uploaded on 02/15/2012 for the course BA 252 taught by Professor Jamescampbell during the Winter '03 term at UMSL.

Page1 / 35

chapter12b - 12-1Operations Operations...

This preview shows document pages 1 - 10. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online