Performance analysis of a multi-item production-inventory system under alternative policies

This paper explores the performance of a multi-item production-inventory system. The paper compares two alternative policies, representing different modes of collecting and utilizing information. It derives a closed-form measure of performance for one of them, the familiar first-come-first-served policy, and proposes a comparable approximation for the other, the longest-queue policy. These results are illustrated and tested through simulations. In this way the paper addresses several basic managerial issues: What is the value of centralized information in complex systems? How does the breadth of the product line affect performance?