Matching Supply with Demand An Introduction to Operations

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Matching Supply with Demand: An Introduction to Operations Management Gérard Cachon Christian. Terwiesch All

Matching Supply with Demand: An Introduction to Operations Management Gérard Cachon Christian. Terwiesch All slides in this file are copyrighted by Gerard Cachon and Christian Terwiesch. Any instructor that adopts Matching Supply with Demand: An Introduction to Operations Management as a required text for their course is free to use and modify these slides as desired. All others must obtain explicit written permission from the authors to use these slides. Slide 1

O’Neill’s Hammer 3/2 wetsuit Slide 2

O’Neill’s Hammer 3/2 wetsuit Slide 2

Hammer 3/2 timeline and economics Slide 3

Hammer 3/2 timeline and economics Slide 3

Oneill data Slide 4

Oneill data Slide 4

Oneill data Slide 5

Oneill data Slide 5

Forecasts vs actual graph Forecasts and actual demand for surf wet-suits from the previous

Forecasts vs actual graph Forecasts and actual demand for surf wet-suits from the previous season Slide 6

Empirical distribution function for the Hammer 3/2 using historical A/F ratios Slide 7

Empirical distribution function for the Hammer 3/2 using historical A/F ratios Slide 7

A portion of the Standard Normal Distribution Function Table, F(z). Slide 8

A portion of the Standard Normal Distribution Function Table, F(z). Slide 8

Empirical vs normal demand distribution Empirical distribution function (diamonds) and normal distribution function with

Empirical vs normal demand distribution Empirical distribution function (diamonds) and normal distribution function with mean 3192 and standard deviation 1181 (solid line) Slide 9

Balancing the risk and benefit of ordering a unit Slide 10

Balancing the risk and benefit of ordering a unit Slide 10

Hammer 3/2's expected loss sales table if the empirical distribution is the demand forecast

Hammer 3/2's expected loss sales table if the empirical distribution is the demand forecast Slide 11

Performance measures relationship Expected demand, m Fill rate Expected sales If Normal demand, s

Performance measures relationship Expected demand, m Fill rate Expected sales If Normal demand, s Loss function table Order quantity, Q, and, if Normal demand, z = (Q – m)/s Distribution function table Expected lost sales In-stock probability Stockout probability Price, cost, salvage value Slide 12 Exp. left over inventory Expected profit

Service measures of performance Slide 13

Service measures of performance Slide 13

Pareto curve Slide 14

Pareto curve Slide 14