Strategy

Our primary strategy was focused on increasing production flexibility to handle

variable demand. This can be achieved by reducing queues, increasing capacity,
adjust inventory levels to avoid stock-outs, reduce lead time and lower ordering
costs by reducing ordering frequency and requesting high quantities of inventory
per order. We also needed to find the perfect number of machines for each job. Thus
the major decision parameters were:
1.
2.
3.
4.
5.

Reorder Quantity
Safety Stock
Inventory
Lot Size
Reorder Point

Equipment Decision:
The utilization was very high in station 1 in the beginning of the simulation. The big
utilization generated big queues at the beginning of the simulation. So we will start
with buying more machines to reduce the utilization and by consequence, the
queues for all the three stations. Since cash can be a constraint, so our priority of
machine purchase would be Job Station 1, Job Station 3 and then Job Station 2
based on the capacity utilization.