Advance Demand Information and Safety Capacity as a Hedge Against Demand and Capacity Uncertainty

@article{Hu2003AdvanceDI,
  title={Advance Demand Information and Safety Capacity as a Hedge Against Demand and Capacity Uncertainty},
  author={Xinxin Hu},
  journal={Manufacturing & Service Operations Management},
  year={2003},
  volume={5},
  pages={55-58}
}
To control a production-inventory system, a manager has to consider the variability in demand as well as variability in her production process. Both types of variability corrupt system performance and by alleviating either of them, the manager can improve the performance of the system. There has been a recent trend towards investing in better information systems to provide better advance demand information. Also, many firms have focused on having safety capacity (e.g., outsourcing or overtime… CONTINUE READING

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