IDEAS home Printed from https://ideas.repec.org/a/eee/ejores/v330y2026i2p444-457.html

On the transition from make-to-stock to make-to-order

Author

Listed:
  • Singh, Yogendra
  • Disney, Stephen M.

Abstract

Value stream mapping reveals there are two replenishment decisions and three classes of lead times in the manufacturing echelon of a supply chain. The first replenishment decision releases production orders to maintain the finished goods inventory (FGI), and the second replenishment decision issues supplier orders to replenish the raw materials inventory (RMI). The three different classes of lead times are (a) customer lead time, (b) production lead time, and (c) supplier lead time. We develop a z-transform transfer function model of this system to investigate its dynamic performance. We find that FGI costs increase in the production lead time and decrease in the customer lead time, whereas RMI costs increase in both the production lead time and the supplier lead time. We capture the dynamics of, and transition between, make-to-stock (MTS) and make-to-order (MTO) settings in a single unified model. We show that when transitioning from an MTS to an MTO supply chain, RMI costs decrease in the customer lead time for positively correlated demand and exhibit an odd-even oscillation for negatively correlated demand.

Suggested Citation

  • Singh, Yogendra & Disney, Stephen M., 2026. "On the transition from make-to-stock to make-to-order," European Journal of Operational Research, Elsevier, vol. 330(2), pages 444-457.
    • Handle: RePEc:eee:ejores:v:330:y:2026:i:2:p:444-457
    DOI: 10.1016/j.ejor.2025.08.053
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0377221725006903
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.ejor.2025.08.053?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:ejores:v:330:y:2026:i:2:p:444-457. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/eor .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.