Influence of lot size and planned lead time on service level and inventory for a single stage make-to-order production system with random required lead times.
K. Altendorfer - Influence of lot size and planned lead time on service level and inventory for a single stage make-to-order production system with random required lead times. - 18th International Working Seminar on Production Economics, Innsbruck, Austria, 2014, pp. 1-13
In production planning, the decisions on lot size and planned lead time both influence the logistic performance of a production system. These decisions are themselves interrelated since, e.g., higher lot sizes imply a higher processing time of a production lot which influences the production lead time distribution and therefore also the planned lead time setting. Most analytical studies in this field either focus on planned lead time optimization, assuming single item processing or predefined production lot processing distribution, or on the optimization of production lot sizes, neglecting the planned lead time effect. In this paper, an analytical approach to model the influence of the interrelated planning parameters lot size and planned lead time on the key figures service level and inventory is developed for a situation with random customer required lead times. A single-stage make-to-order production system producing different items with item specific lot sizes and planned lead times is investigated. An analytical model approximating this common production lead time distribution by the G/G/1 queuing model is presented which includes the variance impact of the item specific lot sizes.