A Comparison of DRP and TOC Customer Service Performance Within A Multi-Product, Multi-Echelon Physical Distribution Environment

摘要

This paper propositioned and tested whether a Theory of Constraints heuristic could improve customer service performance beyond traditional methods in a multi-product, multi-echelon physical distribution environment exhibiting seasonality and partial lost sales. Field research was conducted to capture the structure of a multi-echelon physical distribution system, facilitating development of a baseline computer simulation of a fully distributed inventory system with orders planned by DRP. That model became the basis for development of comparative models, one employing partial centralization of inventory with orders planned by DRP, two models employing TOC-based heuristics for buffering and replenishment. Simulation results find the TOC system more effective than either the distributed or the partially centralized multi-echelon system when orders are based on DRP.