en>Helpful Pixie Bot: ISBNs (Build KE)

2012-05-11T04:55:33Z

ISBNs (Build KE)

New page

{{Use dmy dates|date=August 2012}}
The '''dynamic lot-size model''' in [[inventory theory]], is a generalization of the [[economic order quantity]] model that takes into account that demand for the product varies over time. The model was introduced by [[Harvey M. Wagner]] and [[Thomson M. Whitin]] in 1958.<ref>[[Harvey M. Wagner]] and [[Thomson M. Whitin]], "Dynamic version of the economic lot size model," Management Science, Vol. 5, pp. 89–96, 195</ref><ref>Wagelmans, Albert, Stan Van Hoesel, and Antoon Kolen. "[http://repub.eur.nl/res/pub/2310/eur_wagelmans_22.pdf Economic lot sizing: an O (n log n) algorithm that runs in linear time in the Wagner-Whitin case]." Operations Research 40.1-Supplement-1 (1992): S145-S156.</ref>

==Problem setup==
We have available a forecast of product demand <math>D_t</math> over a relevant time horizon (for example we might know how many widgets will be needed each week for the next 52 weeks). There is a setup cost <math>S</math> incurred for each order and there is an inventory holding cost <math>H</math> per item per period (S and H can also vary with time if desired). The problem is how many units to order now to minimize the sum of setup cost and inventory cost.

Wagner and Whitin gave an algorithm for finding the optimal solution by [[dynamic programming]]. Because this method was perceived by some as too complex, a number of authors also developed approximate [[heuristics]] (e.g., the [[Silver-Meal heuristic]]) for the problem.

==References==
{{reflist}}

== Further reading ==
* Lee, Chung-Yee, Sila Çetinkaya, and Albert PM Wagelmans. "[http://repub.eur.nl/res/pub/7707/1999-0954.pdf A dynamic lot-sizing model with demand time windows]." ''[[Management Science (journal)|Management Science]]'' 47.10 (2001): 1384-1395.
* Federgruen, Awi, and Michal Tzur. "A simple forward algorithm to solve general dynamic lot sizing models with n periods in 0 (n log n) or 0 (n) time." ''[[Management Science (journal)|Management Science]]'' 37.8 (1991): 909-925.
* Jans, Raf, and Zeger Degraeve. "Meta-heuristics for dynamic lot sizing: a review and comparison of solution approaches." ''European Journal of Operational Research'' 177.3 (2007): 1855-1875.
* [[H.M. Wagner]] and T. Whitin, "Dynamic version of the economic lot size model," ''[[Management Science (journal)|Management Science]]'', Vol. 5, pp. 89–96, 1958
* [[H.M. Wagner]]: "Comments on Dynamic version of the economic lot size model", ''[[Management Science (journal)|Management Science]]'', Vol. 50 No. 12 Suppl., December 2004

==External links==
* [http://openresearch.wordpress.com/2009/09/03/solving-the-lot-sizing-problem-in-resolver-one-wagner-whitin-algorithm/ Solving the Lot Sizing Problem using the Wagner-Whitin Algorithm]
* [http://eureka-operationresearch.blogspot.com/2011/09/dynamic-lot-size-model.html Dynamic lot size model]

[[Category:Operations research]]

Wilkinson matrix - Revision history

en>Helpful Pixie Bot: ISBNs (Build KE)