Further developments on safety stocks in an MRP system applying Laplace transforms and input–output analysis

• Published in: International journal of production economics Vol. 60; no. 1; pp. 381 - 387
• Main Authors: Grubbström, Robert W., Tang, Ou
• Format: Journal Article Conference Proceeding
• Language: English
• Published: Amsterdam Elsevier B.V 20.04.1999; Elsevier Science; Elsevier; Elsevier Sequoia S.A
• Series: International Journal of Production Economics
• Subjects: Applied sciences; Exact sciences and technology; Input output analysis; Inventory control, production control. Distribution; Laplace transform; Laplace transforms; Material requirements planning; MRP; Multi-period production; Operational research and scientific management; Operational research. Management science; Operations research; Probability; Production management; Safety stock; Stochastic models; Studies; TECHNOLOGY; TEKNIKVETENSKAP; MRP; Multi-period production; Safety stock; Laplace transform; Input-output analysis; Gamma distribution; Input output analysis; Stock management; Material requirements planning; Laplace transformation; Objective function; Optimization
• ISSN: 0925-5273; 1873-7579; 1873-7579
• DOI: 10.1016/S0925-5273(98)00141-8

In a sequence of previous papers, the Laplace transform and Input–Output Analysis have been applied to formulate a theoretical basis for material requirements planning (MRP) under different levels of generalisation. Searching for the optimal safety stock is one of the extensions of this theory. This paper investigates the safety stock properties in the case that the time interval of demand is Gamma-distributed. The Generalised Leontief inverse plays an effective role in describing the multi-level production–inventory system when the subordinate products are produced according to a lot-for-lot (L4L) policy.