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An inventory planning methodology for a semiconductor manufacturer with significant sources of variability

IP.com Disclosure Number: IPCOM000128082D
Original Publication Date: 1999-Dec-31
Included in the Prior Art Database: 2005-Sep-14
Document File: 4 page(s) / 18K

Publishing Venue

Software Patent Institute

Related People

Graban, Mark R: AUTHOR [+3]

Related Documents

http://theses.mit.edu:80/Dienst/UI/2.0/Describe/0018.mit.theses/1999-106: URL

Abstract

The research and thesis focus on the development and implementation of a data-driven inventory and production planning methodology for the Eastman Kodak Company's Microelectronics Technology Division (MTD). The thesis gives an introduction to MTD's products, processes, and customers, as well as the current business conditions, recent improvements, and challenges present at MTD at the time of the research. The thesis examines the major causes of the need to hold inventory: to buffer against low yield, yield variability, long cycle times, cycle time variability, and uncertain demand. The thesis builds upon extensions of the Base Stock model to recommend target finished goods inventory (FGI) and work- inprocess (WIP) levels, as well as material release decisions. The model also allows MTD to predict expected customer service levels under their actual inventory situation. While the methodology is demonstrated for one important MTD product, the methodology can potentially be used for other MTD products with similar regular demand patterns. While holding inventory provides short-term solutions to problems such as cycle time variability, the framework provides a means for quantifying the impact of production system improvements on customer service and inventory costs. The model allows MTD to estimate the inventory and cost savings that would result from longer-term improvements such as cycle time reduction, yield improvement, or variability reduction. The thesis also outlines the processes for using this framework on an ongoing basis, periodically adjusting for changes to production system performance measures or demand. Thesis Advisors: Stanley B. Gershwin, Senior Research Scientist Stephen C. Graves, Abraham Siegel Professor of Management

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 This record is the front matter from a document that appears on a server at MIT and is used through permission from MIT. See http://theses.mit.edu:80/Dienst/UI/2.0/Describe/0018.mit.theses/1999-106 for copyright details and for the full document in image form.

An Inventory Planning Methodology for a Semiconductor Manufacturer with Significant Sources of Variability

by

Mark R. Graban
B.S., Industrial Engineering and Management Science Northwestern University, 1995 Submitted in partial fulfillment of the requirements for the degree of Master of Business Administration and Master of Science in Mechanical Engineering In conjunction with the Leaders for Manufacturing program

Sloan School of Management

at the Massachusetts Institute of Technology

May 1999 [June, 1999]

SIGNATURE OF author: [[signature omitted]]

Sloan School of Management Department of Mechanical Engineering CERTIFIED BY: [[SIGNATURE OMITTED]]

Stephen C. Graves Abraham Siegel Professor of Management Thesis Supervisor Stanley B. Gershwin

Senior Research Scientist Thesis Supervisor

ACCEPTED BY: [[SIGNATURE OMITTED]]

Lawrence S. Abelin Director of Master's Program Sloan School of Management Ain Sonin
Chairman, Committee on Graduate Students Department of Mechanical Engineering

ARCHIVES MASSACHUSETTS INSTITUTE OF TECHNOLOGY LIBRARIES JUN 16 1999

Massachusetts Institute of Technology Page 1 Dec 31, 1999

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An inventory planning methodology for a semiconductor manufacturer with significant sources of variability

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[2]

An Inventory Planning Methodology for a Semiconductor Manufacturer with Significant Sources of Variability

by Mark R. Graban

Submitted to the Sloan School of Management and the Department of Mechanical Engineering in partial fulfillment of the requirements for the degrees of Master of Business Administration and Master of Science in Mechanical Engineering

Abstract:

The research and thesis focus on the development and implementation of a data-driven inventory and production planning methodology for the Eastman Kodak Company's Microelectronics Technology Division (MTD). The thesis gives an introduction to MTD's products, processes, and customers, as well as the current business conditions, recent improvements, and challenges present at MTD at the time of the research.

The thesis examines the major causes of the need to hold inventory: to buffer against low yield, yield variability, long cycle times, cycle time variability, and uncertain demand. The thesis builds upon extensions of the Base Stock model to recommend target finished goods inventory (FGI) and work- inprocess (WIP) levels, as well as material release decisions. The model also allows MTD to predict expected customer service levels under their actual inventory situation. While the methodology is demonstrated for one important MTD product, the methodology can potentially be used for other MTD products with similar regular demand patterns.

While holding inventory pro...