Incorporating manufacturing lead times in joint production-marketing models: A review and some future directions |
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Authors: | Abhijit Upasani Reha Uzsoy |
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Institution: | (1) Laboratory for Extended Enterprises at Purdue, School of Industrial Engineering, Purdue University, 315 N. Grant Street, West Lafayette, IN 47907-2023, USA;(2) Edward P. Fitts Department of Industrial and Systems Engineering, North Carolina State University, 300 Daniels Hall, Raleigh, NC 27695-7906, USA |
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Abstract: | In many industries the pricing of a product over time can be used to manage demand for the product. Lead time, or promised
delivery time is often a significant factor in price negotiations. However, the production planning literature has largely
treated pricing decisions as exogeneous while focusing on the allocation of production capacity between products over time.
On the other hand, the marketing literature has generally ignored the effects of capacity constraints and focused on the effects
of pricing.
In this paper, we begin by reviewing the existing literature on integrative production-marketing research, focusing on those
models that consider lead times and capacity. We suggest a number of directions for future research that take advantage of
recent developments in production planning models, as well as explicit modeling of feedback loops governing key parameters,
which suggest a broader view of the problem. |
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Keywords: | Production/marketing interface Dynamic price and lead time quotation Load dependent lead time |
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