Critical Ratio Scheduling: Dynamic Due-Date Procedures under Demand Uncertainty

This paper is concerned with the problem of maintaining order due dates in job shops that manufacture products to replenish a finished goods inventory controlled by an order point system. Two different strategies for maintaining order due dates-static and dynamic due date procedures-are analyzed using both shop and inventory system performance measures. This study examines the influence of the degree of predictability of the final product demand pattern on the performance of the static and dynamic procedures. The demand pattern for individual products is characterized by a long-run demand rate, a period-to-period serial correlation coefficient of demand, and a coefficient of demand variation. The results indicate that the dynamic due-date procedure does not provide a significant improvement in the performance of the production system in comparison with the static procedure - even when the predictability of the demand during the replenishment lead time is improved.