A Perceptions Framework For Categorizing Inventory Policies In Single-Stage Inventory Systems

In this paper we propose a perceptions framework for categorizing a range of inventory policies, including optimal inventory policies, that can be employed in a single-stage supply chain. We take the existence of a wide range of inventory policies, including what we would term optimal and suboptimal policies, as given and strive not to model the reasons that the policies persist but seek a way to categorize them via their effects on inventory levels, orders placed and the demand faced by the inventory system. Using a perspective that we consider natural and thus appealing, the categorization involves the use of conceptual perceptions of demand which underpin the link between the three characteristics of the inventory system: inventory levels, orders placed and actual demand faced.