Analysis of the Critical Item Performance of the Gardner-Dannenbring Aggregate Inventory Model.
Abstract
A 1984 Air Force Logistics Management Center (AFLMC) study compared the Standard Base Supply System (SBSS) inventory models to ten alternative models. The AFLMC report concluded, in part, that an aggregate inventory system which minimizes backorders, subject to investment and workload constraints, better suits the operational needs of the Air Force than does a system which minimizes total variable costs. The AFLMC aggregate model was based on the Gardner-Dannenbring Two Lambda Aggregate Inventory Model, which does not discriminate between those consumable items which are critical to a mission and those which are not. This study investigated means of improving the model's critical item performance. Considerable improvement was made possible by setting artificially low critical item unit costs, thereby increasing the proportion of funds allocated to critical items, but this improvement was at the expense of the model's non-critical item performance. Additionally, the model's critical item performance was marginally improved by reducing the workload slack in the model's solution. High backorder items, responsible for disproportionately large numbers of backorders, were identified by an 'item profile' of unit cost and demand rate. The benefits of cost reductions and lower demand rates for the high backorder items (simulating the effects of component re-design) are demonstrated.
Document Details
- Document Type
- Technical Report
- Publication Date
- Sep 01, 1985
- Accession Number
- ADA161785
Entities
People
- David A. Thomson
Organizations
- Air Force Institute of Technology