Value of Disruption Information in an EOQ Environment


Bakal İ. S. , Emer D. E. , Bayındır Z. P.

IFORS International Conference, Barcelona, İspanya, 13 - 18 Temmuz 2014, ss.75

  • Basıldığı Şehir: Barcelona
  • Basıldığı Ülke: İspanya
  • Sayfa Sayıları: ss.75

Özet

Value of Disruption Information in an EOQ Environment

Ismail Serdar Bakal, Z. Pelin Bayindir, Deniz Esin Emer

We consider an infinite-horizon, continuous-review inventory model

with deterministic, stationary demand where supply is subject to disruption.

The supply process alternates randomly between ON and OFF

states. Backlogging is allowed only when the supplier is disrupted. We

seek the value of disruption information which enables the firm to place

an extra order when supply is disrupted. We derive the long-run average

cost utilizing the renewal theory, and characterize the order-up-to

levels. We also compare the results to the setting with no disruption

order opportunity.

Value of Disruption Information in an EOQ Environment

Ismail Serdar Bakal, Z. Pelin Bayindir, Deniz Esin Emer

We consider an infinite-horizon, continuous-review inventory model

with deterministic, stationary demand where supply is subject to disruption.

The supply process alternates randomly between ON and OFF

states. Backlogging is allowed only when the supplier is disrupted. We

seek the value of disruption information which enables the firm to place

an extra order when supply is disrupted. We derive the long-run average

cost utilizing the renewal theory, and characterize the order-up-to

levels. We also compare the results to the setting with no disruption

order opportunity.