Chapter 2InventoryManagementand Risk Pooling王长琼2015-4-24
Chapter 2 Inventory Management and Risk Pooling 1 王长琼 2015-4-24
ObjectivesUnderstandinginventoryina supplychainWhyinventoryisimportant?How to manage it?SingleStageInventoryControl- Economic Lot Size Model- Demand UncertaintyMultipleOrderOpportunitiesRiskPooling
Objectives • Understanding inventory in a supply chain Why inventory is important? How to manage it? • Single Stage Inventory Control - Economic Lot Size Model - Demand Uncertainty • Multiple Order Opportunities • Risk Pooling 2
CASE: Steel WorksWhy inventoryis important?How to manage it?: What are the main problems?--- too much inventory--poorservice3
CASE: Steel Works • Why inventory is important? How to manage it? • What are the main problems? - too much inventory - poor service 3
Custom Products(定制产品)Rapid growth, 1/3 of total sales (s133 MM)OnecustomerperproductVery high marginsHigh service level 3 plants, co-located with R&D centerEachproductproducedatasingleplant
Custom Products(定制产品) • Rapid growth, 1/3 of total sales ($133 MM) • One customer per product • Very high margins • High service level • 3 plants, co-located with R&D center • Each product produced at a single plant 4
Specialty ProductsS（特色产品）Rapid growth, 2/3 of total sales ($267 MM)·6 product families3 plants, each producing 2 product families130customers,120productsFew big customers: 5Highly volatile demand:Highservicelevel5
Specialty Products（特色产品） • Rapid growth, 2/3 of total sales ($267 MM) • 6 product families • 3 plants, each producing 2 product families • 130 customers, 120 products • Few big customers: 5 • Highly volatile demand: • High service level 5