Browsing by Author "Chiang, C"

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A note on optimal policies for a periodic inventory system with emergency orders
(2001-02-01)
Chiang, C
;
管理科學系
;
Department of Management Science
In this article, we develop a dynamic programming model for a periodic review inventory system in which emergency orders can be placed at the start of each period, while regular orders are placed at the beginning of an order cycle (which consists of a number of periods). We assume that the regular and emergency supply lead times differ by one period. We devise a simple algorithm of computing the optimal policy parameters. Thus, the ordering policy developed is easy to implement.
A periodic review inventory system with two supply modes
(1996-11-08)
Chiang, C
;
Gutierrez, GJ
;
管理科學系
;
Department of Management Science
We describe a periodic review inventory system in which there are two modes of resupply, namely a regular mode and an emergency mode. Orders placed through the emergency channel have a shorter supply lead time but are subject to higher ordering costs compared to orders placed through the regular channel. We analyze this problem within the framework of an order-up-to-R inventory control policy. At each review epoch, the inventory manager must decide which of the two supply modes to use and then order enough units to raise the inventory position to a level R. We show that given any non-negative order-up-to level, either only the regular supply mode is used, or there exists an indifference inventory level such that if the inventory position at the review epoch is below the indifference inventory level, the emergency supply mode is used. We also develop procedures for solving for the two policy parameters, i.e., the order-up-to level and the indifference inventory level.
A periodic review inventory system with two supply modes
(1996-11-08)
Chiang, C
;
Gutierrez, GJ
;
管理科學系
;
Department of Management Science
We describe a periodic review inventory system in which there are two modes of resupply, namely a regular mode and an emergency mode. Orders placed through the emergency channel have a shorter supply lead time but are subject to higher ordering costs compared to orders placed through the regular channel. We analyze this problem within the framework of an order-up-to-R inventory control policy. At each review epoch, the inventory manager must decide which of the two supply modes to use and then order enough units to raise the inventory position to a level R. We show that given any non-negative order-up-to level, either only the regular supply mode is used, or there exists an indifference inventory level such that if the inventory position at the review epoch is below the indifference inventory level, the emergency supply mode is used. We also develop procedures for solving for the two policy parameters, i.e., the order-up-to level and the indifference inventory level.
Optimal control policies for a periodic review inventory system with emergency orders
(1998-03-01)
Chiang, C
;
Gutierrez, GJ
;
管理科學系
;
Department of Management Science
We describe a periodic review inventory system where emergency orders, which have a shorter supply lead time but are subject to higher ordering cost compared to regular orders, can be placed on a continuous basis. We consider the periodic review system in which the order cycles are relatively long so that they are possibly larger than the supply lead times. Study of such systems is important since they are often found in practice. We assume that the difference between the regular and emergency supply lead times is less than the order-cycle length. We develop a dynamic programming model and derive a stopping rule to end the computation and obtain optimal operation parameters. Computational results are included that support the contention that easily implemented policies can be computed with reasonable effort. (C) 1998 John Wiley & Sons, Inc.
Optimal ordering policies for periodic-review systems with replenishment cycles
(2006-04-01)
Chiang, C
;
管理科學系
;
Department of Management Science
In this paper, we consider inventory models for periodic-review systems with replenishment cycles, which consist of a number of periods. By replenishment cycles, we mean that an order is always placed at the beginning of a cycle. We use dynamic programming to formulate both the backorder and lost-sales models, and propose to charge the holding and shortage costs based on the ending inventory of periods (rather than only on the ending inventory of cycles). Since periods can be made any time units to suit the needs of an application, this approach in fact computes the holding cost based on the average inventory of a cycle and the shortage cost in proportion to the duration of shortage (for the backorder model), and remedies the shortcomings of the heuristic or approximate treatment of such systems (Hadley and Whitin, Analysis of Inventory Systems, Prentice-Hall, Englewood Cliffs, NJ, 1963). We show that a base-stock policy is optimal for the backorder model, while the optimal order quantity is a function of the on-hand inventory for the lost-sales model. Moreover, for the backorder model, we develop a simple expression for computing the optimal base-stock level; for the lost-sales model, we derive convergence conditions for obtaining the optimal operational parameters. (c) 2004 Elsevier B.V. All rights reserved.
Optimal ordering policies for periodic-review systems with replenishment cycles
(2005-04-01)
Chiang, C
;
管理科學系
;
Department of Management Science
In this paper, we consider inventory models for periodic-review systems with replenishment cycles, which consist of a number of periods. By replenishment cycles, we mean that an order is always placed at the beginning of a cycle. We use dynamic programming to formulate both the backorder and lost-sales models, and propose to charge the holding and shortage costs based on the ending inventory of periods (rather than only on the ending inventory of cycles). Since periods can be made any time units to suit the needs of an application, this approach in fact computes the holding cost based on the average inventory of a cycle and the shortage cost in proportion to the duration of shortage (for the backorder model), and remedies the shortcomings of the heuristic or approximate treatment of such systems (Hadley and Whitin, Analysis of Inventory Systems, Prentice-Hall, Englewood Cliffs, NJ, 1963). We show that a base-stock policy is optimal for the backorder model, while the optimal order quantity is a function of the on-hand inventory for the lost-sales model. Moreover, for the backorder model, we develop a simple expression for computing the optimal base-stock level; for the lost-sales model, we derive convergence conditions for obtaining the optimal operational parameters. (c) 2004 Elsevier B.V. All rights reserved.
Optimal replenishment for a periodic review inventory system with two supply modes
(2003-08-16)
Chiang, C
;
管理科學系
;
Department of Management Science
In this paper, we study periodic inventory systems with long review periods. We develop dynamic programming models for these systems in which regular orders as well as emergency orders can be placed periodically. We identify two cases depending on whether or not a fixed cost for placing an emergency order is present. We show that if the emergency supply mode can be used, there exists a critical inventory level such that if the inventory position at a review epoch falls below this critical level, an emergency order is placed. We also develop simple procedures for computing the optimal policy parameters. In all cases, the optimal order-up-to level is obtained by solving a myopic cost function. Thus, the proposed ordering policies are easy to implement. (C) 2002 Elsevier Science B.V. All rights reserved.
Order splitting under periodic review inventory systems
(2001-03-03)
Chiang, C
;
管理科學系
;
Department of Management Science
Most research on order splitting have focused on the reduction of safety stock in the multiple sourcing setting. Moreover, all works study the use of order splitting for the continuous review inventory systems. In this paper, we investigate the possibility of the multiple-delivery arrangement in the sole sourcing environment. In addition, we concentrate on the reduction of cycle stock for periodic review systems. We show that splitting an order into multiple deliveries can significantly reduce the total cost especially if the cost of despatching an order for an item is not small. Although the use of information technology such as EDI decreases the ordering cost and thus shortens the period length, order splitting remains a cost-effective approach as long as the cost of despatching an order is not close to zero. (C) 2001 Elsevier Science B.V. All rights reserved.
Ordering policies for inventory systems with expediting
(2002-11-01)
Chiang, C
;
管理科學系
;
Department of Management Science
Most studies in the inventory literature assume either no expediting or placing an additional order in the case of an emergency. However, many companies do expedite orders or shipments. In this paper, we propose two continuous-review single-item policies when expediting is allowed. The first is a modified Allen and D'Esopo's model when expediting is possible before a threshold time point, while the second is a heuristic policy when an expediting decision can be made at a certain time point during the lead time. We also devise a simple tabulation algorithm to find the optimal operational parameters. Computational results show that the proposed policies perform better than the ordinary no-expediting model, especially when the service level, is high.
Reducing inventory costs by order splitting in the sole sourcing environment
(1996-03-01)
Chiang, C
;
Chiang, WC
;
管理科學系
;
Department of Management Science
In this paper, we examine the possibility of the arrangement for multiple deliveries in each order cycle for the continuous review inventory system. The problem is mainly found in the retail sector where inventory often makes up the majority of a company's assets. Most works recently have focused on the reduction of safety stock in the multiple sourcing setting. This research, instead, considers the reduction of cycle stock in the sole sourcing environment. The formulation where a predetermined service level serves as a constraint for the objective function is employed throughout this research. We show that splitting the order into multiple deliveries can significantly reduce the inventory carrying cost especially when the interarrival times between deliveries are determined optimally.