Two-way substitution effects on inventory in configure-to-order production systems

摘要

In designing configure-to-order productionsystems for a growing product variety, companies arechallenged with an increased complexity for obtaining highproductivity levels and cost-effectiveness. In academiaseveral optimization methods and conceptual frameworksfor substituting components, or increasing storage capacityhave been proposed. Our study presents a practicalframework for quantifying the impact of a two-waysubstitution at different production stages and its impact oninventory utilization. In a case study we quantify the relationbetween component substitution, and inventory capacityutilization, while maintaining the production capacity as wellas the external product variety.