Discrete-order admission ATP model with joint effect of margin and order size in a MTO environment
Swarming demands and seasonality periodically induce a stringent capacity problem in the made-to-order (MTO) B2B environment. Desirable order admission is a tactic with minimal application cost for handling this problem. A real-time order admission problem with limited major-customer population and batch-size demand with heterogeneous distributions is modeled as a dynamic and stochastic knapsack problem. The optimality of the Markovian deterministic reward-threshold policy is verified. Optimal policy, basic policy, and the capacity rationing method are compared in the designed experiment. The numerical results suggest great potential for increasing profit using the optimal order admission policy for MTO businesses.
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Barut, M. & Sridharan, V, 2004. "Design and evaluation of a dynamic capacity apportionment procedure," European Journal of Operational Research, Elsevier, vol. 155(1), pages 112-133, May.
- Sridharan, Sri V., 1998. "Managing capacity in tightly constrained systems," International Journal of Production Economics, Elsevier, vol. 56(1), pages 601-610, September.
- Bodily, S. E. & Weatherford, L. R., 1995. "Perishable-asset revenue management: Generic and multiple-price yield management with diversion," Omega, Elsevier, vol. 23(2), pages 173-185, April.
- Garrett van Ryzin & Jeff McGill, 2000. "Revenue Management Without Forecasting or Optimization: An Adaptive Algorithm for Determining Airline Seat Protection Levels," Management Science, INFORMS, vol. 46(6), pages 760-775, June.
- Balakrishnan, Nagraj & Patterson, J. Wayne & Sridharan, V., 1999. "Robustness of capacity rationing policies," European Journal of Operational Research, Elsevier, vol. 115(2), pages 328-338, June.
- Arreola-Risa, Antonio, 1996. "Integrated multi-item production-inventory systems," European Journal of Operational Research, Elsevier, vol. 89(2), pages 326-340, March.
- Kalyan Talluri & Garrett van Ryzin, 1998. "An Analysis of Bid-Price Controls for Network Revenue Management," Management Science, INFORMS, vol. 44(11-Part-1), pages 1577-1593, November.
- Gregory A. DeCroix & Antonio Arreola-Risa, 1998. "Optimal Production and Inventory Policy for Multiple Products Under Resource Constraints," Management Science, INFORMS, vol. 44(7), pages 950-961, July.
- Pibernik, Richard, 2005. "Advanced available-to-promise: Classification, selected methods and requirements for operations and inventory management," International Journal of Production Economics, Elsevier, vol. 93(1), pages 239-252, January.
- Jason D. Papastavrou & Srikanth Rajagopalan & Anton J. Kleywegt, 1996. "The Dynamic and Stochastic Knapsack Problem with Deadlines," Management Science, INFORMS, vol. 42(12), pages 1706-1718, December.
When requesting a correction, please mention this item's handle: RePEc:eee:proeco:v:133:y:2011:i:2:p:761-775. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Dana Niculescu)
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.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with 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 profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.