Incorporating Time Value of Money into Lot-Sizing Decisions for Improved Supply Chain Performance

Purnomo, Agus (2024) Incorporating Time Value of Money into Lot-Sizing Decisions for Improved Supply Chain Performance. Journal of System and Management Sciences, 14 (3). pp. 514-532. ISSN ISSN 1816-6075 (Print), 1818-0523 (Online)

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Abstract

Supply chain performance depends heavily on effective inventory management, for which appropriate lot-sizing is critical. This research develops an improved lot-sizing model for material requirements planning (MRP) by incorporating the time value of money. The proposed Silver-Meal method is compared to the traditional approach using data from 5 Indonesian manufacturers. Results indicate 1.78% reduced inventory costs over a 2-year horizon. Further analysis reveals superior performance under varying financial parameters. This research contributes to the literature by addressing limitations in classical MRP models. It provides a valuable decision-making tool for practitioners to enhance supply chain efficiency. Opportunities exist for validating findings across more industry contexts.

Item Type:	Article
Subjects:	T Technology > T Technology (General)
Depositing User:	Dr. Ir. Agus Purnomo, M.T. CMILT.
Date Deposited:	29 Jul 2024 06:46
Last Modified:	29 Jul 2024 06:46
URI:	http://eprint.ulbi.ac.id/id/eprint/2389

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