An Available-to-Promise Model for Periodical Order Promising

Jie Zhang (), Wei Qin and Wenhao Wang
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Jie Zhang: Shanghai Jiaotong University
Wei Qin: Shanghai Jiaotong University
Wenhao Wang: Shanghai Jiaotong University

A chapter in LISS 2014, 2015, pp 167-171 from Springer

Abstract: Abstract To be competitive in an e-business era, it is critical to make not only responsive but also profitable order promises with an Available-to-Promise (ATP) system. While common practice like first-come-first-served (FCFS) basis will deteriorate overall profit especially under resource shortage situation. In this paper, a dynamic resource reservation policy for order-promising was proposed to prevent current less-profitable customer orders from over consuming the critical resource. Assuming known independent demand distributions, a corresponding stochastic model was developed. Finally, simulation experiments were conducted and showed that the benefit of enforcing the policy is correlated to initial availability.

Keywords: Available-to-promise; Reservation policy; Resource allocation (search for similar items in EconPapers)
Date: 2015
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Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-3-662-43871-8_26

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DOI: 10.1007/978-3-662-43871-8_26

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