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| Author: | Brown, G. |
| Title: | The Kellogg Company Optimizes Production, Inventory, and Distribution |
| Journal: | Interfaces
2001 : NOV-DEC, VOL. 31:6, p. 1-15 |
| Index terms: | PRODUCTION INVENTORY CONTROL DISTRIBUTION |
| Language: | eng |
| Abstract: | For over a decade, the Kellogg Company has used its planning system (KPS), a large-scale, multiperiod linear program, to guide production and distribution decisions for its cereal and convenience foods business. An operational version of KPS, at a weekly level of detail, helps determine where products are produced and how finished products and in-process products are shipped between plants and distribution centers. A tactical version of KPS, at a monthly level of detail, helps to establish plant budgets and make capacity-expansion and consolidation decisions. Operational KPS reduced production, inventory, and distribution costs by an estimated $4.5 million in 1995. Tactical KPS recently guided a consolidation of production capacity with a projected savings of $35 to $40 million per year. |
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