• Proceedings of the Korean Operations and Management Science Society Conference
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• 2003.11a
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• pp.159-165
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• 2003

The objective of this paper is to provide an improved reorder decision policy for general multi-echelon distribution systems utilizing the shared stock information. Since it has been known that traditional reorder policies sometimes show poor performance in distribution systems, in our previous research we introduced the order risk policy which utilizes the shared stock information more accurately f3r the 2-echelon distribution system and proved the optimality. However, since the real world supply chain is generally composed with more than 2 echelons, we extend the order risk policy for the general multi-echelon systems. Since the calculation of the exact order risk value fur general multi-echelon systems is very complex, we provide two approximation methods. Through the computational experiment comparing the order risk policy with the existing policies under various conditions, we show the performance of the order risk policy and analyze the value of the shared stock information varying with the characteristics of the supply chain.

• IE interfaces
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• v.17 no.3
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• pp.359-374
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• 2004

The objective of this paper is to provide an improved reorder decision policy for general multi-echelon distribution systems utilizing the shared stock information. It has been known that traditional reorder policies sometimes show poor performance in distribution systems. Thus, in our previous research we introduced the order risk policy which utilizes the shared stock information more accurately for the 2- echelon distribution system and proved the optimality. However, since the real world supply chain is generally composed with more than 2 echelons, we extend the order risk policy for the general multi-echelon systems. Since the calculation of the exact order risk value for general multi-echelon systems is very complex, we provide two approximation methods for the real-time calculation. Through the computational experiment comparing the order risk policy with the existing policies under various conditions, we show the performance of the order risk policy and analyze the value of the shared stock information varying with the characteristics of the supply chain.

• The Transactions of The Korean Institute of Electrical Engineers
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• v.60 no.11
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• pp.2165-2170
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• 2011

The separate order for the electrical work is an institutional plan to improve the electrical construction quality and strengthen the competitiveness of the electrical contractors. The systematic approach for the policy implementation of the separate ordering system can make its adaptability higher and lead to a policy success. There are many kinds of effects on the implementation of the separate order, but institutional foundation is needed for increasing the policy adaptability. The necessity of the systematic and theoretical foundation was detected in various factors by considering policy implementation theory. In order to fix the separate ordering system, reasonable methods such as finding inducements and offering incentive are more effective than legal procedures. At last, a variety of policy adaptability plans must be founded in order to invigorate the separate ordering system in a view of the policy implementation.

• Journal of the Korea Society for Simulation
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• v.10 no.1
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• pp.35-50
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• 2001

Managing multi-echelon inventory systems has gained importance over the last decade mainly because integrated control of supply chains consisting of several processing and distribution stages has become feasible through modern information technology. Determination of optimal inventory policy for multi-echelon supply chain is made difficult by the complex interaction between the different levels. In this paper, we investigate performance of five inventory policies (fixed quantity order policy, fixed interval order policy, compromised order policy, lead time-fixed quantity order policy, and mixed order policy) in a multi-echelon supply chain by using a simulation model constructed with AweSim simulation language. The results of the simulation study show that the mixed order policy is the best among five inventory policies in the most test problems except the case when the stockout cost per unit is much higher than the inventory holding and transportation costs per unit.

• Proceedings of the Korean Operations and Management Science Society Conference
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• 2004.05a
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• pp.636-647
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• 2004

The objective of this paper is to provide an improved reorder decision policy for general multi-echelon distribution systems utilizing the shared stock information. It has been known that traditional reorder policies sometimes show poor performance in distribution systems. Thus, in our previous research we introduced the order risk policy which utilizes the shared stock information more accurately for the 2-echelon distribution system and proved the optimality. However, since the real world supply chain is generally composed with more than 2 echelons, we extend the order risk policy for the general multi-echelon systems. Since the calculation of the exact order risk value for general multi-echelon systems is very complex, we provide two approximation methods for the real-time calculation. Through the computational experiment comparing the order risk policy with the existing policies under various conditions, we show the performance of the order risk policy and analyze the value of the shared stock information varying with the characteristics of the supply chain.

• Journal of the military operations research society of Korea
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• v.28 no.2
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• pp.1-19
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• 2002

This study shows the effect of inventory policy change from supplier-based to customer-based. We focus on the service level, cost, and information distortion of the Military Supply Chain(MSC) with System Dynamics. We design MSC model according to field practician interviews by using Vensim. The simulation makes a comparison between supply-based inventory policy performances and order-based inventory policy performances. In order to evaluate the MSC performances, we measure the accumulation of backlog(service level), supply chain cost, and order percentage overshoot(information distortion). The results show that 1) changing inventory policy from supplier-based to end customer order-based gets a good customer service, reduces MSC cost, and prevents information distortion, 2) changing inventory policy from supplier-based to immediate customer order-based reduces a small amount of MSC cost and deteriorates customer service, and 3) supply level is main factor for MSC performances improvement. This study implicates the policy change makes a improvement of MSC performance without introducing information system.

• Journal of the Korea Society of Computer and Information
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• v.8 no.4
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• pp.159-164
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• 2003

Location of stock in a warehouse directly affects the total materials handling expense of all goods moving through the warehouse. The purpose of this paper is to develop a storage policy in order picking warehouse, the block-based storage policy to minimize the total order picking time. In block-based storage policy, the rack is divided into blocks and items are assigned to each block based on the turn-over rate of each item and the average distance between the blocks and the dock. To demonstrate the performance of the proposed policy, we compare with the existing method called class-based storage policy under various matching methods.

• Journal of Navigation and Port Research
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• v.33 no.7
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• pp.477-482
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• 2009

In this paper the order picking problem in warehouses is considered, a topic which has received considerable attention from the international academic body in recent years. The order picking problem deals with the retrieval of order items from prespecified locations in the warehouse, and its objective is usually the minimization of travel time or travel distance. Hence, a well-thought order picking policy in combination with an appropriate storage policy will enhance warehouse efficiency and reduce operational costs. This paper starts with a literature overview summarizing approaches to routing order pickers, assigning stock-keeping units to pick locations and designing warehouse layouts. Since the layout design might affect both storage and routing policies, the three factors are interdependent with respect to order picking performance. To test these interdependencies, a simulation experiment was set up, involving two types of warehouse layout, four types of storage policy, five well-known heuristics and five sizes of order picking list. Our results illustrate that from the point of view of order picking distance minimization it is recommended to equip the warehouse with a third cross aisle, although this comes at the cost of a certain space loss. Additionally, we propose a set of most appropriate matches between order picking heuristics and storage policies. Finally, we give some directions for further research and recommend an integrated approach involving all factors that affect warehouse efficiency.

• Proceedings of the Korean Operations and Management Science Society Conference
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• 2005.10a
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• pp.10-26
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• 2005

In our model, we keep inventory to satisfy uncertain demands which arrives irregularly. In this situation, we have additional two constraints. First, we need to have certain amount of order consolidation (consolidation constraint) for the orders to replenish the inventory because of production or purchase constraint. And also, if we order at a certain date which was set by administrative convenience, we have amount constraint to order the consolidated order demands (capacity constraint). We showed this variant inventory policy is needed in steel industry and note that there will be possible similar case in industry. To deal with this case, we invented a variant replenishment policy and show this policy is superior to other possible polices in the consolidation constraint case by extensive simulation. And we derive a combined solution method for dealing with the capacity constraints in addition to the consolidation constraints. For this, we suggest a combined solution method of integer programming and simulation.

• Management Science and Financial Engineering
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• v.15 no.1
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• pp.33-49
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• 2009

We examine the effectiveness of the conventional (Q, r) model in managing production-inventory systems with finite capacity, stochastic demand, and stochastic order processing times. We show that, for systems with finite production capacity, order replenishment lead times are highly sensitive to loading and order quantity. Consequently, the choice of optimal order quantity and optimal reorder point can vary significantly from those obtained under the usual assumption of a load-independent lead time. More importantly, we show that for a given (Q, r) policy the conventional model can grossly under or over-estimate the actual cost of the policy. In cases where a setup time is associated with placing a production order, we show that the optimal (Q, r) policy derived from the conventional model can, in fact, be infeasible.