Lecture 06_Newsvendor Problem

Question 1

Newsvendor fractile

Answer 1

c(u) / [c(u) + c(o)]

with c(u) = underage cost
c(o) = overage cost

Question 2

KANBAN
Procedure
Application

Production on demand (just-in-time)

Answer 2

Application
- limited fluctuation of demand, short transport distance
- mass and large-scale production

Procedure
- remove full container from storage
- Kanban (Card) is removed from container and put in a box, this represents the source of a production order
- produced parts are put in container and Kanban is attached, storage is filled with full container

Source (producing node) -> buffer stock -> sink (consuming node)

Question 3

KANBAN Loop

Pull-based system

Answer 3

1. Subassembly (Sink) [Material Flow]
2. KANBAN Box [Information flow]
3. Parts Production (Source)
4. Buffer Stock

Question 4

Safety Stock S
Formula

Answer 4

S = k * σ √L

Question 5

How to insert learning curve into formula

e.g. 90% learning curve
e.g. 10% decrease of costs

Answer 5

log(0.9)
log(0.9)

Question 6

How to select demand from table of probability distribution..

Answer 6

• add row and column together to determine demand
  p > 0.5
• demand = k
• with k as ∑ of column and row value

when p < 0.5
- p’ = p - 1 e.g. 0.45 -> p’ = 0.55
- d = m - (k - m)

m = mean of distribution