Production and order processing policies in make-to-order based process industry

In this study we develop a computer simulation model to evaluate the effects of various production and order processing policies measured in terms of on-time delivery rate and average waiting time of job orders. Policies considered include: eliminating inflated due date, lot splitting, loss time reduction, attaining full flexibility in production lines, and selective order promising scheme. Actual order-production data from a chemical company were used in the simulation model. Based on the simulation results, we make several suggestions that can significantly reduce the production lead time and increase the on-time delivery rate.