A DSS framework for integrating inventory management and purchasing in ATO production environment

Abstract

This paper proposes a framework for a Decision Support System (DSS) that integrates inventory management and purchasing in an Assemble-To-Order (ATO) production environment. Under the ATO production environment, the final product is assembled from different components that are produced in a make-to-stock system. The focus of this paper is on how to manage the appropriate stock quantities for each related component throughout the production process in ATO system. The DSS generates scenarios based on management specifications such as the effect of variations in demand, stock control level, re-order point, total cost and lead time. The proposed system can be used to improve inventory management, profit and inventory cost calculations in practical problems between supplier and order placement in production system.