John S. Morris

Top-down or bottom-up: Aggregate versus disaggregate extrapolations

Abstract Two approaches have been suggested for forecasting items in a product line. The top-down (TD) approach uses an aggregate forecast model to develop a summary forecast, which is then allocated to individual items on the basis of their historical relative frequency. The bottom-up (BU) approach employs an individual forecast model for each of the items in the family. The present study compares these two approaches by using over 15,000 aggregate series constructed by combining individual series from the M-competition database. The effects of correlation between individual items and the relative frequency of individual items in the family are examined. In most situations, BU forecasting of family items produces more accurate forecasts.

A simulation comparison of process and cellular layouts in a dual resource constrained environment

Abstract Cellular manufacturing is an integral part of a comprehensive Group Technology program designed to improved the productivity of batch production systems. It has been suggested that shorter throughput times and accompanying reductions in work-in-process inventory are possible due to the inherent flexibility of cellular layouts with respect to worker scheduling. This research examines the impact of a dual resource (labor and equipment) constrained shop on the relative performance of cell layouts vis-a-vis process layouts. In addition, three operator scheduling rules are tested in the cellular layout. The first rule assigns operators on a first come-first served basis to jobs competing for an operators services. The second rule requires operators in a cell to select a job from the machine queue with the longest queue of jobs. The third rule has operators remaining at a machine queue until it is empty. In the process layout, operators are assinged to waiting jobs on a first come-first served basis. In the initial experiment, the process layout outperformed the cellular layout on both work-in-process levels and throughout time. Additional experiments investigated the sensitivity of the initial results to changes in shop congestion. The process layout outperformed the cellular layout in all of the experiments. The results may be attributed to lower machine and labor utilization in the cellular layout from the dedication of equipment to limited part families.

Top-down versus bottom-up forecasting strategies

Abstract Some controversy exists about the advocacy of top-down versus bottom-up forecasting strategies. Top-down forecasting refers to the process of forecasting the demand for the aggregate of items in a class and then inferring individual demands according to a percentage of the total; bottom-up refers to separately forecasting the requirements for each individual item. This paper outlines the relative advantages of each strategy and indicates the situations in which each should be preferred.

A simulation analysis of the effectiveness of drum-buffer-rope scheduling in furniture manufacturing

Abstract Simulation has proven to be an important computer tool in analyziing new manufacturing approaches. In this paper we use simulation models to compare a new approach to manufacturing with current practices. The new approach is referred to as the Drum-Buffer-Rope (DBR) method of synchronous manufacturing. We discuss the DBR approach and demonstrate the application of DBR in a furniture manufacturing case example. Simulation models are used to compare the DBR approach with the typical system of production control referred to as a cutting approach. The simulation analysis indicates considerable savings in makespan are possible when DBR is used in place of the cutting approach.

A composite EOQ model for situational decomposition

Abstract The simple EOQ model is embellished into a composite EOQ model by including shipping costs, inspection costs, in-transit holding costs, backorder costs, finite replenishment, and quality rejects in its formulation. The composite model can be disaggregated into numerous different deterministic hybrid models by using simple decomposition rules that apply to a variety of different operational situations. Additionally, composite EOQ extensions for quantity discounts and transitional price changes are devised which can be easily disaggregated with the same simple decomposition rules.

The changing role of middlemen in the distribution of personal computers

Abstract Channels of distribution evolve over time in response to changes in the business environment. The internet has emerged as a new channel system and, as E-commerce unfolds, new business models replace traditional ones. In this new channel system, the consumer has attained greater power over traditional channel intermediaries. New cybermediaries have emerged to perform some of the traditional channel functions, and are better able to provide the consumer with greater value through cost efficiencies, timely information, and a broader choice of products/services offered in a worldwide marketplace. Traditional channel intermediaries must now either adjust or face elimination according to the intermediation–disintermediation–reintermediation (IDR) cycle. The purpose of this article is to review the IDR cycle in the personal computer (PC) industry and to discuss some of the new business models that have emerged.

Introducing Quality Function Deployment in the Marketing Classroom

Today, product-oriented businesses focus on shortening the time to market, reducing costs and increasing product quality in the design and manufacture of new products. Quality function deployment (QFD) is one means to achieving these product development objectives. Central to the QFD process is the voice of the customer to drive design. Cross-functional product teams consisting of design engineers, operations management experts, and marketing researchers work closely to ensure that the customers’ needs are included in the design process. The House of Quality exercise described in this article represents the initial step in the QFD process and emphasizes marketing’s role in the voice of the customer research.

The Changing Manufacturing Environment: Implications for Marketing

Considers the response of US firms to the recent decline in productivity, growth etc and the subsequent adoption of just in time manufacturing pioneered by Japanese industry. Examines the concentration on the reduction in time and costs of the early stages of the product life cycle and the flexibility this allows the subsequent pricing strategies. Highlights the emphasis placed on distribution scheduling and the consolidation of transportation services. Concludes that US firms have accepted that JIT and cost and time reduction programs have been necessary in order to compete in the 1990s.

Relational Database Management Systems: A New Tool for Coding and Classification

In this article the properties of relational database management systems (DBMSs) are discussed. It is shown how they can be used as an effective tool for performing the function of primary‐key‐coding schemes for classifying product families in the application of group technology. The attributes of the relational DBMS are demonstrated and compared to traditional coding schemes.

The Evaluation of Wood-Fired Cogeneration Investments Using Monte-Carlo Simulation

Monte-Carlo simulation was used in a capital budgeting decision involving the purchase of a wood-fired cogeneration plant. Two alternative capacities, 6-MW and 9-MVV plants, were considered in the analysis using net present value as the evaluation criterion. Risk profiles were generated for both investments as well as for the mean and variance of returns. When cash flows were approximated using annual cash flows, the resulting risk profiles did not produce a clear choice. However, using more realistic monthly cash flows, the 6-MW plant showed both a higher return and less risk than the 9-MW facility. The difference in the results arises from the fact that the annual-period model masks the effects of the inherent monthly variability of some cash flows and timing of cash savings. Consequently, the use of probabilistic, monthly-period models is recommended over the annual-period model in this as well as in other investments that incorporate a large degree of seasonal variability.