New Inventory Policy Saves Costs and Reduces Back Orders Dramatically
The article discusses a way to speed up delivery times by expediting orders when inventory is low, which can reduce back orders. The researchers developed a model to find the best parameters for this policy, considering different costs involved. They found that the optimal parameters can be efficiently calculated, leading to significant cost savings. The study showed that order expediting can save money, with the proposed policy capturing most of the potential savings.