2006 Prentice Hall, Inc. F – 1 Operations Management Module F – Simulation 2006 Prentice Hall, Inc. PowerPoint presentation to accompany PowerPoint presentation to accompany Heizer/Render Heizer/Render Principles of Operations Management, 6e Principles of Operations Management, 6e Operations Management, 8e Operations Management, 8e
This document is posted to help you gain knowledge. Please leave a comment to let me know what you think about it! Share it to your friends and learn new things together.
PowerPoint presentation to accompanyPowerPoint presentation to accompany Heizer/Render Heizer/Render Principles of Operations Management, 6ePrinciples of Operations Management, 6eOperations Management, 8e Operations Management, 8e
An attempt to duplicate the An attempt to duplicate the features, appearance, and features, appearance, and characteristics of a real systemcharacteristics of a real system
1.1. To imitate a real-world situation To imitate a real-world situation mathematicallymathematically
2.2. To study its properties and To study its properties and operating characteristicsoperating characteristics
3.3. To draw conclusions and make To draw conclusions and make action decisions based on the action decisions based on the results of the simulationresults of the simulation
1.1. Relatively straightforward and flexibleRelatively straightforward and flexible
2.2. Can be used to analyze large and Can be used to analyze large and complex real-world situations that complex real-world situations that cannot be solved by conventional cannot be solved by conventional modelsmodels
3.3. Real-world complications can be Real-world complications can be included that most OM models cannot included that most OM models cannot permitpermit
4.4. ““Time compression” is possibleTime compression” is possible
5.5. Allows “what-if” types of questionsAllows “what-if” types of questions
6.6. Does not interfere with real-world Does not interfere with real-world systemssystems
7.7. Can study the interactive effects of Can study the interactive effects of individual components or variables in individual components or variables in order to determine which ones are order to determine which ones are importantimportant
Disadvantages of SimulationDisadvantages of Simulation
1.1. Can be very expensive and may take Can be very expensive and may take months to developmonths to develop
2.2. It is a trial-and-error approach that may It is a trial-and-error approach that may produce different solutions in repeated produce different solutions in repeated runsruns
3.3. Managers must generate all of the Managers must generate all of the conditions and constraints for conditions and constraints for solutions they want to examinesolutions they want to examine
4.4. Each simulation model is uniqueEach simulation model is unique
1.1. Begin each simulation day by checking to see if Begin each simulation day by checking to see if ordered inventory has arrived. If if has, increase ordered inventory has arrived. If if has, increase current inventory by the quantity ordered.current inventory by the quantity ordered.
2.2. Generate daily demand using probability Generate daily demand using probability distribution and random numbers.distribution and random numbers.
3.3. Compute ending inventory. If on-hand is Compute ending inventory. If on-hand is insufficient to meet demand, satisfy as much as insufficient to meet demand, satisfy as much as possible and note lost sales.possible and note lost sales.
4.4. Determine whether the day's ending inventory has Determine whether the day's ending inventory has reached the reorder point. If it has, and there are reached the reorder point. If it has, and there are no outstanding orders, place an order. Choose no outstanding orders, place an order. Choose lead time using probability distribution and lead time using probability distribution and random numbers.random numbers.
Inventory SimulationInventory SimulationDaily order costDaily order cost == ((cost of placingcost of placing 1 1 orderorder) x ) x ((number of orders placed per daynumber of orders placed per day))
== $10 $10 per orderper order xx .3 .3 order per dayorder per day = $3 = $3Daily holding costDaily holding cost == ((cost of holdingcost of holding 1 1 unit forunit for 1 1 dayday) x ) x ((average ending inventoryaverage ending inventory))
== 50¢ 50¢ per unit per per unit per dayday xx 4.1 units 4.1 units per day per day
== $2.05$2.05Daily stockout costDaily stockout cost== ((cost per lost cost per lost salesale) x ) x ((averageaverage number of lost sales per daynumber of lost sales per day))
== $8 $8 per lost saleper lost sale xx .2 .2 lost sales per daylost sales per day
Using Software in SimulationUsing Software in Simulation
Commercial simulation programs are Commercial simulation programs are available for many applications - Extend, available for many applications - Extend, Modsim, Witness, MAP/1, Enterprise Modsim, Witness, MAP/1, Enterprise Dynamic, Simfactory, ProModel, Micro Dynamic, Simfactory, ProModel, Micro Saint, ARENASaint, ARENA
Spreadsheets such as Excel can be used Spreadsheets such as Excel can be used to develop some simulationsto develop some simulations