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Safety Stocks in MRP---Systems with Emergency Setups for Components

Author

Listed:
  • Robert C. Carlson

    (Department of Industrial Engineering and Engineering Management, Stanford University, Stanford, California 94305)

  • Candace A. Yano

    (Department of Industrial and Operations Engineering, University of Michigan, Ann Arbor, Michigan 48109)

Abstract

Material Requirements Planning or Manufacturing Resource Planning (MRP) systems originally were designed for a deterministic environment. Often, however, demand for finished products is uncertain and some type of buffering mechanism is necessary to provide desired levels of service. When the schedule is replanned each period, as typically is done, variability of demand may manifest itself in the form of early or "emergency" production runs. Safety stock may serve to avert some or most of these emergency production runs. We have developed a heuristic algorithm which is shown to provide extremely good guidelines for setting safety stock levels.

Suggested Citation

  • Robert C. Carlson & Candace A. Yano, 1986. "Safety Stocks in MRP---Systems with Emergency Setups for Components," Management Science, INFORMS, vol. 32(4), pages 403-412, April.
    • Handle: RePEc:inm:ormnsc:v:32:y:1986:i:4:p:403-412
    DOI: 10.1287/mnsc.32.4.403
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    Citations

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    Cited by:

    1. Vincent Giard & Mustapha Sali, 2012. "Monitoring of the upstream part of a supply chain dedicated to the customized mass production with a revisited version of MRP," Working Papers hal-00875498, HAL.
    2. Vincent Giard & Mustapha Sali, 2012. "Pilotage d'une chaîne logistique par une approche de type MRP dans un environnement partiellement aléatoire," Working Papers hal-00875497, HAL.
    3. repec:dau:papers:123456789/9020 is not listed on IDEAS
    4. Tsubone, Hitoshi & Furuta, Hirohisa, 1996. "Replanning timing in hierarchical production planning," International Journal of Production Economics, Elsevier, vol. 44(1-2), pages 53-61, June.
    5. Mula, J. & Poler, R. & Garcia-Sabater, J.P. & Lario, F.C., 2006. "Models for production planning under uncertainty: A review," International Journal of Production Economics, Elsevier, vol. 103(1), pages 271-285, September.
    6. repec:dau:papers:123456789/9021 is not listed on IDEAS
    7. Yue Tan & Liyi Gu & Senyu Xu & Mingchao Li, 2024. "Supply Chain Inventory Management from the Perspective of “Cloud Supply Chain”—A Data Driven Approach," Mathematics, MDPI, vol. 12(4), pages 1-30, February.
    8. Gonçalves, João N.C. & Sameiro Carvalho, M. & Cortez, Paulo, 2020. "Operations research models and methods for safety stock determination: A review," Operations Research Perspectives, Elsevier, vol. 7(C).

    More about this item

    Keywords

    inventory/production; multi-echelon;

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