On the effect of overtime and subcontracting on supply chain safety stocks

Tarik Aouam and Kunal Kumar

Omega, 2019, vol. 89, issue C, 1-20

Abstract: In supply chain safety stock placement models, production lead times are typically considered exogenous; however, in many supply networks, lead times are controllable and should be considered as endogenous variables. This work integrates strategic safety stock placement with subcontracting and overtime planning that can be used to optimize lead times. We formulate the problem of jointly optimizing safety stocks and lead times to minimize production and inventory holding costs, while guaranteeing a customer service level.

Keywords: Subcontracting; Overtime planning; Safety stocks; Congestion; Integration (search for similar items in EconPapers)
Date: 2019
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Citations: View citations in EconPapers (4)

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DOI: 10.1016/j.omega.2018.09.010

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