Supply planning and inventory control under lead time uncertainty: A review

Abstract

In literature, most papers examine several stochastic demand processes where order lead times are constant. In reality, lead time is rarely constant; unpredictable events in the supply system cause unpredictable delays. It is true that in certain special cases, lead time uncertainty has essentially no effect and can be ignored. Nevertheless more often, lead time fluctuations strongly degrade performance, just as demand uncertainty does. Seemingly, lead time uncertainty has been neglected for a long time in favor of studying demand uncertainties. Industry agrees that it is overdue and there is a need to rectify this oversight. Nowadays, this gap in research activity begins to be filled in order to respond to companies having non-deterministic lead-times constraints. This paper reviews some of existing literature of supply planning under uncertainty of lead times. The extensive literature review that we compiled consists of citations from 1970 to 2012. A classification scheme for supply planning under uncertainty is defined.