Illustration of the two main types of errors resulting from the use of economic order quantity (EOQ) as a tool for production planning. Designed to allow a class discussion to begin with a consideration of a common type of error, the error in the calculation of the EOC from the use of incorrect data input parameters of the formula. Analysis can proceed to a more general discussion of the second type of error, the wrong EOQ and reorder point (ROP) techniques to this system. Class discussions can be concluded with the student recommendations of alternative methods that may be better suited for Blanchard than EOQ / ROP method. "Hide
by Paul W. Marshall, Alan H. Drinan Source: Harvard Business School 11 pages. Publication Date: September 1, 1972. Prod. #: 673033-PDF-ENG
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