Assessment of stock size to minimize cutting stock production costs

A method for assessing the optimal stock size for the expected order size for a single-period one-dimensional cutting stock problem is proposed. The stock size is optimal when the expected total costs of trim loss, warehousing, and non-fulfilment are minimum. The stock size is the sum of all bar lengths in the stock, and the order size is the sum of shorter bar lengths in various numbers of pieces. Using simulated test cases, a statistical estimation of optimal stock size is conducted, which in our case is approximately 50% above the expected order. The proposed method can help company choose the appropriate level of stock to minimize their total costs.     

Predatory investment U.S. vs. IBM

This paper examines the most likely example of anticompetitive behavior uncovered in the U.S. vs. IBM antitrust suit: the introduction by IBM of its 360/90 ‘super computer’ in response to the introduction of a similar machine by a competitor. The two leading competing hypotheses are examined — that IBM introduced its system as a weapon of predation, and that IBM expected the system to be profitable — and both are found wanting. The paper concludes that IBM almost certainly knew that the system would be unprofitable, but that the hypothesis of predation is less appealing than that of product-market signaling.     

The takeover market in Europe: Control structures and the performance of large companies compared

This paper describes a number of significant differences which exist between countries with respect to the freedom of the take-over market of corporations. The basic division is that between, on the one hand, the oligarchically structured Germanic (and Japanese) firms, which are virtually impossible to take over against the will of the leadership of the company, backed up by various control structures. The Anglo-Saxon type of firm, on the other hand, is—save for some exceptions—democratically structured and subject to bids, even if these displace management. The third type—the one found in Latinic countries—lies in between these two, for various institutionalist reasons.The second part of the paper discusses whether theory can throw any light on the behavioural and performance consequences of these structural/institutional differences. The derivation from such considerations is that, indeed, important and systematic divergencies in corporate behaviour and performance are to be expected.     

Likely gains from market timing in Japan

This paper explores the potential gains and required predictive ability of market timing in Japan and then compares the results to previously reported findings from another developed financial market — the United States — and a developing Asia Pacific financial market — Singapore. Shifts between cash equivalents and common stocks are evaluated. The results demonstrate that the potential gains from market timing in Japan are quite attractive and that the minimum predictive accuracy required for successful market timing may be attainable by some portfolio managers. However, for the period examined, the results also indicate that larger incremental gains result from market timing Singapore stocks and cash equivalents.An earlier version of this paper was presented at the Second Annual Pacific Basin Finance Conference in Seoul, Korea in 1991. The author appreciates the helpful comments of Lim Kian Guan and two anonymous referees.     

The Use of Semi-Probabilistic Grading to Motivate Decision Analysis Students

The problem of determining cost minimum cutting conditions for machine tools is a classic problem In manufacturing economics. Recent interest In automated process planning has led researchers to examine ways to incorporate these calculations into the protean planning software. In this paper we examine the choice of cost parameters traditionally used in theBe models and argue that they have, in general, been incorrectly specified.     

Stock rationing under service level constraints in a vertically integrated distribution system

This paper addresses a rationing problem in a two-level, vertically integrated distribution system composed of one manufacturer and several retail points. The motivating case, developed in the vending machine sector and modeled as a newsvendor-like problem, is representative of many real settings where short-term changes in demand can be substantial while capacity modification is not a viable option. The paper provides an analytical discussion of the problem from two different standpoints: a pure profit-maximization perspective and a minimum service-level perspective, both subject to a product availability constraint that affects the service level the company can provide, and the related expected profit. By analyzing the Lagrangean formulation of the problem, we devise efficient computational procedures based on dichotomy search to find the optimal allotments to retailers, maximizing the expected profit and ensuring a minimum service level. Then, we extend the analysis to the evaluation of the highest service level that can be provided, under a product availability constraint. We identify conditions such that the proposed search procedures succeed in finding the optimal solutions, as well as bounds for the search domains. The proposed approach is legitimated under several demand distribution functions subject to a few commonly adopted restrictions that encompass many of the usually adopted continuous distributions. Finally, the paper presents a three-step decision-making framework using the proposed procedures, summarizing the decision paths the manufacturer might follow in order to optimize the allocation decision.     

Variance amplification and the golden ratio in production and inventory control

A discrete linear control theory model of a generic model of a replenishment rule is presented. The replenishment rule, which we term a “Deziel Eilon—automatic pipeline, inventory and order-based production control system”, is guaranteed to be stable. From a z-transform model of the policy, an analytical expression for bullwhip is derived that is directly equivalent to the common statistical measure often used in simulation, statistical and empirical studies to quantify the bullwhip effect. This analytical expression clearly shows that we can reduce bullwhip by taking a fraction of the error between the target and actual inventory and pipeline (or work in progress (WIP) or “orders placed but not yet received”) positions. This is in contrast to the common situation where ordering policies account for all of the error every time an order is placed. Furthermore, increasing the average age of the forecast reduces bullwhip, as does reducing the production/distribution lead-time. We then derive an analytical expression for inventory variance using the same procedure to identify the closed form bullwhip expression.We assume that a suitable objective function is linearly related to the bullwhip and inventory variance amplification ratios and then optimise the PIC system for different weightings of order rate and inventory level variance. We highlight two forms of the objective function, one where “the golden ratio” can be used to determine the optimal gain in the inventory and WIP feedback loop and another that allows the complete range of possible solutions to be visualised. It is interesting that the golden ratio, which commonly describes the optimum behaviour in the natural world, also describes the optimal feedback gain in a production and inventory control system.     

Farm subsidies and obesity in the United States: National evidence and international comparisons

Many commentators have claimed that farm subsidies have contributed significantly to the “obesity epidemic” by making fattening foods relatively cheap and abundant. But U.S. farm policies have generally small and mixed effects on farm commodity prices, which in turn have even smaller and still mixed effects on the relative prices of more- and less-fattening foods. Other factors have had much more influence on reducing the farm prices of food commodities and the consumer prices of food such that any effects of U.S. farm policies on U.S. obesity patterns must have been negligible. Moreover, while many arguments can be made for changing U.S. farm subsidies, even entirely eliminating the current programs could not be expected to have a significant influence on obesity rates. International evidence reinforces this finding. The countries that support their farmers most strongly tend to have relatively low obesity rates. In these countries the main support for farmers comes through trade barriers and higher consumer prices, which—like U.S. policies for sugar, dairy, orange juice, and beef—discourage consumption and reduce obesity. In contrast with agricultural subsidies, agricultural R&D has had a significant effect in the past on the relative price of food commodities and food, and has the potential to influence obesity patterns in the future, but R&D policy is a very blunt instrument for pursuing public health policy objectives.     

A note on “minimizing a weighted quadratic function of job lateness in the single machine system”

A set of jobs is to be scheduled on a single machine where an idle time is allowed to be inserted before the processing of the first job begins. The objective is to find an optimal sequence that minimizes the weighted sum of a quadratic function of job lateness. Sen et al. [Sen, T., Dileepan, P., Lind, M.R., 1995. Minimizing a weighted quadratic function of job lateness in the single machine system. International Journal of Production Economics 42(3), 237–243] presented a branch-and-bound algorithm for the problem; however, as shown in this note, their algorithm does not work because the branching rule for adjacent jobs is not applicable to non-adjacent jobs.     

六自由度并联机器人在金属切削机床中的应用

本文编译了并联机器人在金属切削机床中的应用,详细叙述了该新型机床的性能特点、试验分析及应用前景,因此可供并联机器人研究设计人员在开发与应用时参考。     

On the present worth of multivariate quality loss

Quality loss function has been introduced, by Taguchi, to be a quality performance measure for products since the 1980s. In this paper, we extend the work of Teran et al. [The Engineering Economist 42 (1) (1996) 39–52] and incorporate the concept of time value of money into the multivariate loss function. First, the model for the present worth of the expected multivariate quality loss (PWML) is established and its solution procedure is developed. Then, an example is provided to illustrate how the model can be applied. Some sensitivity analyses are conducted to study the effects of planning horizon, customer discount rate and coefficients of parameter drift on the optimal means at production time and the associated quality loss. From the results of analysis, the longer the planning horizon of the product is, the farther the means should be set relative to the targets at production time. Also, as the customer discount rate increases, the mean should be set closer to the target at production time.     

数控线切割编程中3B程序与CNC程序的转换及应用

数控线切割编程技术在线切割加工中起着主导作用。目前国内外采用的程序格式是CNC国际通用G代码,该程序操作简单、方便、快捷、准确。早期国产数控线切割机床的程序编制采用3B(4B)程序。这些机床的市场占有率仍很大,若更换为有G代码编程的控制柜其费用相当于原机床的售价。本文提出了一种简单的方法,可以将3B(4B)程序直接转换为CNC(ISO代码)程序,而使CNC编程的机床与原3B(4B)编程的国产机床实现数据共享。     

SCK电火花线切割机床的技术改造

通过对SCK电火花线切割机床的技术改造,把电火花加工技术和数控技术、微型计算机技术结合起来。在输入方式、控制系统及数据共享、资源共享等方面对SCK电火花线切割机床进行了重大改造。利用CAXA软件系统,完成了在传统编程方式下很难完成的工作,改造后的SCK电火花线切割机床现已成功地应用于教学与科研之中,其运行状态良好,性能稳定可靠,操作简单方便,低成本、高产出,创造了良好的经济效益与社会效益。     

OPTIMAL ECONOMIC TOOL REGRINDING WITH TAGUCHI'S QUALITY LOSS FUNCTION

One of the major cost components in tool economics is the cost incurred due to deviation in workpiece quality as a result of poor tool-cutting conditions. Commonly, the operating conditions of a culling tool may be restored via regrinding during periodic intervals of the tool's life. This paper proposes that optimal regrinding interval ought to be determined with respect to the optimal number of regrindings. The product of these two values defines the economic life of a tool. The objective function is the minimization of the sum of the expected costs of failure, regrinding, tool purchase, machining, and deviation in workpiece quality. The cost of deviation in workpiece quality is modelled using Tagucbi's loss function. The effect of cutting speed on tool regrinding interval is also explored.     

Case Study: Model for Economic Lifetime of Drilling Machines in the Swedish Mining Industry

The purpose of this article is to develop a practical economic replacement decision model to identify the economic lifetime of a mining drilling machine. A data-driven optimization model was developed for operating and maintenance costs, purchase price, and machine resale value. Equivalent present value of these costs by using discount rate was considered. The proposed model shows that the absolute optimal replacement time (ORT) of a drilling machine used in one underground mine in Sweden is 115 months. Sensitivity and regression analysis show that the maintenance cost has the largest impact on the ORT of this machine. The proposed decision-making model is applicable and useful and can be implemented within the mining industry.     

An economic analysis of the optimal information security investment in the case of a risk-averse firm

This paper presents an analysis of information security investment from the perspective of a risk-averse decision maker following common economic principles. Using the expected utility theory, we find that for a risk-averse decision maker, the maximum security investment increases with, but never exceeds, the potential loss from a security breach, and there exists a minimum potential loss below which the optimal investment is zero. Our model also shows that the investment in information security does not necessarily increase with increasing level of risk aversion of the decision maker. Relationships between vulnerability and investment effectiveness and two broad classes of security breach probability functions are examined, leading to interesting insights that can be used as guidelines for managers to determine the optimal level of security investment for certain types of security threats faced by risk-averse firms. Future research directions are discussed based on the limitations and possible extensions of this study.     

The effects of a free-repair warranty on the discrete-time periodic replacement policy

This paper presents the effects of a free-repair warranty on a periodic replacement policy with a discrete time process. Considering a repairable product that should be operational at the time over an indefinitely long operation cycle n (n=1, 2, …), under the discrete-time periodic replacement policy, a product is preventively replaced at pre-specified operation cycles N, 2N, 3N, … (N=1, 2, …). When the product fails, a minimal repair is performed at the time of failure, and the failure rate is not disturbed by each repair. The cost models from the customers' perspectives are developed for both warranted and non-warranted products. The corresponding optimal replacement period N? is derived such that the long-run expected cost rate is minimized. Under the assumption of the discrete time increasing failure rate, the existence and uniqueness of the optimal replacement period are shown, and the impact of a free-repair warranty on the optimal periodic replacement policies is investigated analytically. The optimal N* for a warranted product should be adjusted toward the end of the warranty period. Finally, numerical examples are demonstrated for the optimal policy illustration and verification. The observations from the numerical results provide valuable information for a buyer (user) to adjust the optimal periodic replacement policy if a product is operating in discrete time under a free-repair warranty.     

The Soviet burden on the world food system : Challenge and response

Through its disruptive entry into western food markets and its non —participation in global efforts at food policy management the Soviet Union has placed a burden upon the world food system. Dr Paarlberg examines this burden and the US response which has been to seek better information on Soviet agriculture, impose ad hoc controls on food sales and to enter a bilateral agreement in 1975. Three other suggested responses —grain reserves held without Soviet participation, a US wheat board, and a North American export cartel —are discussed. The author concludes that the Soviet burden is decreasing and is best lifted by increasing the free supply available for export. In future. Soviet reliance on food imports may draw it into a greater dependence on the non-socialist world.     

UNIT COST MODEL FOR THE TIMING OF CAPACITY CHANGE

The optimal capacity expansion time is an essential problem especially in capital intensive industries, and capacity expansion decisions have a great influence on the firm's operations and profitability. It can be said that the timing question is quite complex, and in practice the experience and intuition of the decision-makers have a central role. We can, however, use theoretical models to explain many essential relations and deepen our understanding of the nature of capacity changes. The actual object of this study is to develop a unit cost minimization model for the timing of capacity expansion. The model is based on the costs and capacities of old and new machines, and the arithmetic growth rate of demand. The analytical solution of the model shows that the relative timing of expansion can be presented with cost advantage and capacity change ratios. It is also shown that the analogical model can be used for capacity replacement and cutting. Finally, the model is extended, and it is shown that such timing can be found which minimizes unit costs and maximizes the profit of the planning period. The original contribution of the study is to suggest an alternative evaluation method for the timing of capacity changes and to present an analytical solution to the formulated problem. The presented model is applied to an illustrative case where capacity addition is planned either through expansion or replacement. The suggestion of the model to the case company is that it is preferable to replace the old machine with a bigger one rather than to acquire a totally new machine.     

Determination of an order-up-to policy in the stochastic economic lot scheduling model

We consider a production–inventory problem with compound renewal item demand. The model consists of stockpoints, one for each item, controlled according to (R,S)-policies and one machine which replenishes them. The replenishment orders are produced with a fixed rate on the machine with significant setup times and costs, which are stochastic and sequence dependent. The time between the release and the production of the replenishment order is called the waiting time. We develop analytical approximations for the first two moments of this waiting time, the order-up-to levels and the average physical inventory levels for all stockpoints, given the target fill rates. These analytical approximations allows for a quick evaluation of the waiting time which is important when optimization of the system is considered.