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Production Allocation Modeling System: Optimizing for Competitive Advantage in a Mature Manufacturing Industry (Classic Reprint) - Hardcover
Synopsis
Excerpt from Production Allocation Modeling System: Optimizing for Competitive Advantage in a Mature Manufacturing Industry
Setting production targets for geographically dispersed production sites is a common problem in large manufacturing companies. Although it is a routine decision, it encompasses important but sometimes subtle tradeoffs that have a direct impact on corporate performance. The location of production clearly affects the cost of production, because the cost of inputs, as well as taxes and other financial factors, may show wide geographic variation. It also affects the cost of distributing products to customers, which is largely a function of distance. Service levels are also strongly related to the proximity of the production point to customers, and to such factors as the capacity of the plant.
Production targets also set the stage for lower level manufacturing decisions, such as production scheduling and inventory management. More generally, targets largely determine the level of utilization for manufacturing sites. At the most extreme, the allocation of production may call for a site to be shut down or mothballed.
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About the Author
Jeremy Shapiro is a professor emeritus in the Sloan School of Management at MIT. For nine years he served as the co-director of MIT's Operations Research Center. Previously, he was employed by Procter and Gamble, Hughes Aircraft Company, and the Port of New York Authority. He received his B.M.E. and M.I.E. degrees from Cornell University and a Ph.D. degree in Operations Research from Stanford University. Dr. Shapiro has published over 60 papers in the areas of operations research, mathematical programming, logistics, supply chain management, finance, and marketing. He is also president of SLIM Technologies, LLC, a Boston-based firm specializing in the implementation and application of modeling systems for supply chain management and other business problems. His outside interests include reading, traveling, biking and playing tennis. He is married to Martha J. Heigham and has three children, Alexander, Lara, and Nicholas.
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