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Sensitivity Analysis of Lead Time in MRP System: A Case Study

Xiaoyan Wang, Kangzhou Wang, QI Zhong-bin

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Abstract

In this paper we first present an analytical example of MRP system when lead time is given full consideration principally, and consider the importance measures of lead times in system employing one fact at a time (OAT) approach subsequently. As the main result we obtain the expressions of importance indices of lead times. The result implies that decision makers or manufacturers should pay more attention to reducing the lead times of higher level items to reduce risk and cost in production inventory process.

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What this paper is about

In this paper we first present an analytical example of MRP system when lead time is given full consideration principally, and consider the importance measures of lead times in system employing one fact at a time (OAT) approach subsequently. As the main result we obtain the expressions of importance indices of lead times. The result implies that decision makers or manufacturers should pay more attention to reducing the lead times of higher level items to reduce risk and cost in production inventory process.

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Available abstract

In this paper we first present an analytical example of MRP system when lead time is given full consideration principally, and consider the importance measures of lead times in system employing one fact at a time (OAT) approach subsequently. As the main result we obtain the expressions of importance indices of lead times. The result implies that decision makers or manufacturers should pay more attention to reducing the lead times of higher level items to reduce risk and cost in production inventory process.

Key concepts: Lead time, Lead (geology), Production (economics), Sensitivity (control systems), Process (computing), Risk analysis (engineering), Computer science, Reliability engineering

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