Research output: Contribution to Journal/Magazine › Journal article › peer-review
Research output: Contribution to Journal/Magazine › Journal article › peer-review
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TY - JOUR
T1 - Classification for forecasting and stock control
T2 - a case study
AU - Boylan, John
AU - Syntetos, A. A.
AU - Karakostas, G. C.
PY - 2008/4/1
Y1 - 2008/4/1
N2 - Different stock keeping units (SKUs) are associated with different underlying demand structures, which in turn require different methods for forecasting and stock control. Consequently, there is a need to categorize SKUs and apply the most appropriate methods in each category. The way this task is performed has significant implications in terms of stock and customer satisfaction. Therefore, categorization rules constitute a vital element of intelligent inventory management systems. Very little work has been conducted in this area and, from the limited research to date, it is not clear how managers should classify demand patterns for forecasting and inventory management. A previous research project was concerned with the development of a theoretically coherent demand categorization scheme for forecasting only. In this paper, the stock control implications of such an approach are assessed by experimentation on an inventory system developed by a UK-based software manufacturer. The experimental database consists of the individual demand histories of almost 16 000 SKUs. The empirical results from this study demonstrate considerable scope for improving real-world systems.
AB - Different stock keeping units (SKUs) are associated with different underlying demand structures, which in turn require different methods for forecasting and stock control. Consequently, there is a need to categorize SKUs and apply the most appropriate methods in each category. The way this task is performed has significant implications in terms of stock and customer satisfaction. Therefore, categorization rules constitute a vital element of intelligent inventory management systems. Very little work has been conducted in this area and, from the limited research to date, it is not clear how managers should classify demand patterns for forecasting and inventory management. A previous research project was concerned with the development of a theoretically coherent demand categorization scheme for forecasting only. In this paper, the stock control implications of such an approach are assessed by experimentation on an inventory system developed by a UK-based software manufacturer. The experimental database consists of the individual demand histories of almost 16 000 SKUs. The empirical results from this study demonstrate considerable scope for improving real-world systems.
KW - categorization
KW - forecasting
KW - inventory
KW - intermittent demand
KW - case study
U2 - 10.1057/palgrave.jors.2602312
DO - 10.1057/palgrave.jors.2602312
M3 - Journal article
VL - 59
SP - 473
EP - 481
JO - Journal of the Operational Research Society
JF - Journal of the Operational Research Society
SN - 0160-5682
IS - 4
ER -