Modeling and simulation of order‐driven planning policies in build‐to‐order automobile production

In adopting build‐to‐order order fulfillment systems, automotive companies strive to better synchronize their production output with market demand. This essentially gives rise to a new paradigm in production planning. Since all business is linked to customer orders, the operational performance is substantially determined by order‐driven planning. Therefore, a clear understanding of the associated planning tasks, order promising and master production scheduling, as well as their dynamic interaction is essential. Based on the analysis of the decision situation of order‐driven planning in build‐to‐order settings, we provide a framework comprising separate interlinked quantitative models for order promising and master production scheduling. The focus of the contribution is on the modeling and evaluation of both models in a dynamic setting. The approach is evaluated by means of a simulative analysis using empirical data from the automotive industry. Conclusions regarding the potentials of such systems with respect to customer service, the leveling of resource utilization, and holding are presented.