Most production companies rely on a forecast to tell them how much to produce and when the items needs to be done. However many companies have to deal with some kinds of uncertainties in the production, for example in supply and demand and a forecast, that takes every aspect into account, is a costly affair. So many companies rely on safety stocks as a common measure to cope with this kind of uncertainty. This thesis investigates how Materials Requirements Planning, with the use of Silver-Meal Heuris-tic as ordering model, deals with the fact that the demand isn’t as known as we want it to be. Through several simulations, the Materials Requirements Planning model is tested with a stochas-tic demand; one with seasonality and one without. The result gave reason to believe that a safety stock would help the company reach their service goal. An improvement in the service rate and in the total costs was seen as an affect due to the inserted safety stock. Not only was the Materials Requirement planning model tested, but the Silver-Meal heuristic was tested as well. The Silver-Meal model was tested to check how sensitive the model is to changes in the different kind of variables in the model. It was found that the Silver-Meal model depends neg-atively on the ordering costs and positively on the storage costs.
|Educations||MSc in Business Administration and Management Science, (Graduate Programme) Final Thesis|
|Number of pages||79|