An Inventory Control System with Partial Deliveries

Abstract

This paper describes a continuing effort to develop and implement better policies and models for controlling the inventory of materials used in the various construction and maintenance programmes of a large Greek concern. The object of the work has been not only to select a policy, formulate a model, and determine its optimal solution mathematically, but also to analyse the special conditions of the problem, such as legal and political constraints, complex organization structure, information and communication problems, insufficient data, and supply instability, and to adapt to these conditions the policy dictated by theory. The established practice in this system of having the suppliers deliver each order in several instalments was recognized as economical and was incorporated into a simple stochastic re-order cycle policy (T-S) model, which is proposed in the present paper. Finally, questions of acceptability and workability are considered. To mollify line management reactions, proposed changes in the organization structure were kept to a minimum, and good features of the established system were preserved as much as possible.