Optimizing Egg Production in Indonesia Using a Robust Stochastic Approach of Planning
Objective: This study aims to address the challenges of demand variability in Indonesia's poultry industry, which often leads to production inefficiencies, including overproduction and shortages, by proposing a stochastic production plan that minimizes costs associated with these inefficiencies...
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| Format: | Article |
| Language: | English |
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Universitas Islam Nahdlatul Ulama Jepara
2024-12-01
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| Series: | Journal of Management and Entrepreneurship Research |
| Subjects: | |
| Online Access: | https://doi.org/10.34001/jmer.2024.12.05.2-51 |
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| Summary: | Objective: This study aims to address the challenges of demand variability in Indonesia's poultry industry, which often leads to production inefficiencies, including overproduction and shortages, by proposing a stochastic production plan that minimizes costs associated with these inefficiencies within the context of the Indonesian cooperative funding system. Research Design & Methods: A stochastic lot-sizing model was developed, and an experiment was set up with five assessment strategies: basic average demand plan, high reliability demand coverage, cumulative demand, cyclical surplus adjustment, and consecutive surplus adjustment plans. The evaluation phase was conducted at two confidence levels (α = 0.90 and α = 0.95) to assess each plan's ability to minimize total costs effectively. Findings: The results revealed that the cumulative demand strategy consistently outperformed other strategies, minimizing surplus and shortage costs at both α = 0.90 and α = 0.95. This plan demonstrated the lowest surplus-to-demand ratio, making it the most effective in managing production inefficiencies and reducing costs. Implications and Recommendations: Implementing the cumulative demand strategy could significantly enhance the efficiency of production planning in Indonesia's poultry industry by reducing waste and optimizing resources, especially in cooperative funding systems. Contribution & Value Added: This study contributes to the literature by providing an empirical analysis of production planning strategies in the context of demand variability, offering valuable insights into cost-effective solutions for handling production inefficiencies in the poultry industry. |
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| ISSN: | 2723-1658 2723-1666 |