Reduced Costs for Working Capital by Synchronized Material Provision

Timely and simultaneous material supply for the final assembly stage of complex machinery and equipment is a logistical challenge. Performing poorly in this task leads to delayed shipments to customers and high amounts of capital are committed in incomplete sets of supply materials. There is no need for expensive software if data quality and the disposition processes are examined carefully enough to identify possible ways to improve the situation.

material supply, disposition procedures, supply processes, capital commitment, inventory costs, logi

In order to obtain high logistical performance in a production network at low logistical costs, there has to be a high level of synchronization in the material provision of the final assembly. The level of synchronization can be restrained by dynamic effects in a network. This paper presents an approach for identifying critical material procurement processes that are accountable for an insufficient achievement of logistical goals in the material provision. In addition, the results of a simulation study are explained that analyzes the effects of measurements conducted to increase the synchronization of the material provision by also taking dynamic effects into account.

dynamics, material provision, production networks, production planning and control (ppc)