Abstract
Kanban system has been known to be a superior tool to control complex production and inventory systems operating in the just-in-time (JIT) environment. The kanban system works more effectively at low inventory levels when the consumption rates of parts necessary to produce finished goods are leveled. In this research, we propose two smoothed production ordering policies, in which the demand informed in advance as well as immediately delivered demand is exponentially smoothed, for a multi-stage single-item production and inventory system. The paper examines a performance of the proposed production ordering policies as compared to MRP system based on simulation experiments. We conclude that the production smoothing is quite effective as a production ordering policy.
