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The economic order quantity – EOQ - is the optimum amount of material to order that has the lowest inventory cost taking into account the carrying costs, ordering costs, and stockout costs.

Tuesday, 20 October 2009 14:32
Published in Inventory Management
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The MPS (Master Production Schedule) is the schedule program aimed at defining precisely the required quantity per period for each finished product to sell. It is the main part of the manufacturing production plan to make the supply chain work.

Wednesday, 18 November 2009 09:59
Published in Planning & Scheduling
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Now that you should know about the Economic Order Quantity (EOQ) model, the next step is to answer the following question:

Wednesday, 21 October 2009 10:15
Published in Inventory Management
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The MRP - Material Requirements Planning - part of MRP-2 supply chain process - is based on the Orlicky’s theorem (1960):

  • Independant needs must be forecasted, dependant needs must be calculated
Thursday, 19 November 2009 13:53
Published in Planning & Scheduling
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Let’s now dig into the most popular forecasting methods: the simple exponential smoothing model to forecast the next period for a time series without trend, and the double exponential smoothing model taking into account a trend effect.

Tuesday, 03 November 2009 19:34
Published in Forecasting Management
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MRP stands for Material Requirement Planning.

MRP II stands for Manufacturing Requirement Planning and is an evolution of MRP I.


The MRP is a planning process itself developed in the 1960s by Joseph Orlicky from the United States, aimed at planning the supply chain both on the short and long term.

Monday, 16 November 2009 15:54
Published in Planning & Scheduling
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Lean manufacturing has its roots in the Toyota Automobile of Japan where waste was to be avoided at all cost: the waste in time caused by having to repair defective products, the waste of investment in keeping high inventories, and the waste of having idle workers. Lean manufacturing is now a major components of the Supply Chain management.

Monday, 23 November 2009 19:35
Published in Operations Management
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Kanbans are the heart of just-in-time production. Kanban is a Japenese word meaning card and these cards are the means of communication within to, and from a work center.

Tuesday, 24 November 2009 16:06
Published in Operations Management
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The Sales and Operations Plan (S&OP) is derived from the strategic plan and the customer demand in the next 18 months. It takes into account the marketing, finance, manufacturing and plant manager to take decisions on the mid-term supply chain organisation.

Tuesday, 17 November 2009 16:09
Published in Planning & Scheduling
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Here the objective is to establish the demand forecast for a company. But there are different time horizons or levels of forecasting:

Friday, 23 October 2009 09:55
Published in Forecasting Management
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As stated in last article, companies do hold inventory as they need for running their business.

But holding inventory is not free and so has many financial drawbacks:

Monday, 19 October 2009 16:34
Published in Inventory Management
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