Eliminating drift in inventory and order based production control systems

An Inventory and Order Based Production Control System lies at the heart of many commercial and bespoke ordering systems based on periodic review of stock and production targets. This simple and elegant control system works well, even when dealing with scenarios in which there are many competing value streams. However, such “interferences” inevitably cause some uncertainty in pipeline delivery times. We show via linear z-transform analysis that the consequences may include the possibility of inventory drift and instability. In this paper we establish the stability boundaries for such systems, and demonstrate an innovative method of eliminating inventory drift due to lead-time effect. This new principle is confirmed by simulation results.