@inproceedings{09bab505a44248f3b6eedc7ff5bdc7dc,
title = "Integrated capacity and inventory decisions",
abstract = "This paper deals with the simultaneous acquisition of capacity and material in a situation with uncertain demand, with non-zero lead-times for the supply of both material and capacity. Although there is a lot of literature on the time-phased acquisition of capacity and material, most of this literature focuses on one of the two decisions. By using a dynamic programming formulation, we describe the optimal balance between using safety stocks and contingent workforce for various lead-time situations. We compare the cost ingredients of the optimal strategy with the standard inventory approach that neglects capacity restrictions in the decision. The experimental study shows that co-ordination of both decisions in the optimal strategy leads to cost reductions of around 10%.We also derive characteristics of the optimal strategy that we expect to provide a thorough basis for operational decision making.",
author = "N.P. Dellaert and S.D.P. Flapper and T. Tan and J. Jeunet",
year = "2012",
doi = "10.1007/978-3-642-29210-1_74",
language = "English",
isbn = "978-3-642-29210-1",
series = "Operations Research Proceedings",
publisher = "Springer",
pages = "463--468",
editor = "D. Klatte and H.-J. L{\"u}thi and K. Schmedders",
booktitle = "Operations Research Proceedings 2011 : Selected Papers of the International Conference on Operations Research (OR 2011), August 30 - September2, Zurich, Switzerland",
address = "Germany",
note = "conference; International Conference on Operations Research (OR 2011); 2011-08-30; 2011-09-02 ; Conference date: 30-08-2011 Through 02-09-2011",
}