A Design of Experiments Approach to Investigating the Sensitivity of the Re-order Point Method

Abstract

This paper investigates the re-order point inventory management models sensitivity to demand distributions, demand dependencies and lead time distributions. The investigated performance measures are four different versions of service level. The conclusion is for all measures that the single most critical aspect adversely affecting service level performance is the presence of asymmetrically distributed demand.

Quantifying the Bullwhip Effect of Multi-echelon System with Stochastic Dependent Lead Time

“…A few papers have been investigated on stochastic lead time and multi-echelon system, for example Chatfield et al (2004). Nielsen et al (2013) considered the reorder point inventory management models sensitivity to demand distributions, demand dependencies and lead time distribution with four different versions of service level and concluded that the skew of demand distribution is the most significant with regards to the service level. However, no paper has been focused on the effect of stochastic lead time of the upstream echelon to that of the downstream one.…”