A Study On Guaranteed Delivery Time-based Inventory Model Of Component Commonality

With the development of technology and productivity, the consumption level increase, the variety and uncertainty of customer's demand become more significant. Mass Customization has a bright prospect with wide application in the market where customer's demand is more individual and the competition is more intensive. Component commonality becomes a main technology to realize mass customization, because of its capability of meeting the individual demands and improving the capability of quick response. At the same time, with the era of time-based competition in supply chain starting, supply chain management is facing with the pressure of delivery time compression, customer response time is becoming a key factor in gainning competition advantage. There is an interacted relation between lead time and the inventory level of common component. The aim of this thesis is to analyze the quantitative relationship between them, basing on the time-oriented competition, and to find the efficient path to improve customization level, shorten multi-stage response time, optimize inventory management, and lower cost. It is an effective method that can improve the performance of supply chain.Based on published literatures, this thesis starts with the basic inventory model of component commonality, and considers the impact of guaranteed delivery time on the role of commonality. Through comparing between component commonality model and non-component commonality model, the effect of component cost structure on total cost is studied. Shortage cost is the most complicated part of the model, this paper considers different supply policy of common component to account shortage cost when shortages occur. Then this paper extends the model to multi-products, and the lead time of component and guaranteed delivery time of product are considered simultaneously. The basic benefits of component commonality includes both risk-pooling benefits and order-pooling benefits, which are influenced by cost structure. Based on mathematical analysis, the relationship between the cost and benefits of component commonality and different factors of delivery time is studied with special component replenish policys.