Delay cost

Extend the safe useful operation life of major HT/HP power plant items, subject to time-dependent creep and thermal fatigue damage, with benefits in terms of delayed costs for component replacement. 

While most companies within the process industries recognize the importance of information technology in managing their businesses, this technology has been a source of considerable frustration and disappointment. Schedule delays, cost overruns, and failure of the final produc t to perform as expec ted have often eroded the credibility of information technology. However, immense potential remains for the technology, and process companies have no cnoice but to seek continuous improvement. 

For each end product or pre-product the density, the product value and the delay costs have to be defined. The density is necessary in order to convert the order quantity (kg) into order volume (1) (order quantity divided by the density of the corresponding product equals the order volume). 

Delay costs arise in case the product cannot be produced to meet a certain deadline. In order to determine these the value specified for each product is multiplied with the amount of days which the product has been produced late (example delay costs = 100 Euro, production ends four days after the due date — 400 Euro delay costs arise). 

Delay costs per day + operational costs per kg as given in the matrix... 

The first way to calculate the delay and stock costs of a quant is to multiply a delay cost factor/stock cost factor with the difference between the due date and the end of production or any time of the quant. In general this is a rough approximation for an easy and fast calculation. 

The due date calculated by backwards termination is a minimum over all latest ends of production for every successor quant. Therefore it is exact for quants with at most one successor. If there are two or more successors the delay costs calculated with the due date may be higher than the real delay costs because the due date is the smallest end necessary to supply the earliest successor. 

The planner can indude the stock costs in addition to the other costs, but as a consequence delay costs are balanced with stock costs. Here this effect is not wanted at first high demand satisfaction is required. Keeping this to the maximum level, stock costs are lowered around this optimum. The trade off between production for future demands and inventory costs can be maximized by the so called shift operator. 

The objective function of this scenario contains changeover costs, dday costs, stock costs and production costs. The delay costs and stock costs can be calculated in different ways dependent on the situation in which they are needed. 

Fig. 4.16 The examination of combining 236 of a total of 28770 quants (253 quants are visible). Change over costs are Euro 11.2 m. in the upper part, the stock costs are 235,000 Euro. When combining the selected quants the stock and delay costs are reduced to 45,000 Euro + Euro 4 m. for changeover.

Job Completion time (days) Tardiness (days) Delay cost ( )... 

To show how the objective function is computed, consider the sequence x = (3, 1, 2). The job completion times, tardiness values, and delay costs for this sequence are shown in Table 10.2A. 

The objective value for this sequence is the sum of the costs in the delay cost column ... 

The most economical pavement is the one which has the least overall total cost, including construction cost, as well as all future maintenance, rehabilitation, and user time delay costs. Minor variations in pavement thickness or material properties can sometimes make significant differences in the total cost of a pavement. 

Of equal importance to the successful initiation of a non-clinical program are several factors that can have a great impact on the rapidity with which a program can be implemented. Experience has shown that overlooking the importance of these factors can result in unanticipated delays, costing time and money. 

With completion of the project study (Chapter 6), proces development comes to a certain conclusion. If all of the boundary conditions are positive, then a strategic or economic decision must be made by the responsible company division or the board of directors on the basis of the available information (project study, marketing studies, patent situation, etc.). Every delay costs money, since the test plants (mini- or pilot plant) must be operated again, albeit to a lesser extent, or because a competitor could reach the market earlier. Popular excuses for further delaying a decision are ... 

You are part of a development group assigned to determine the properties and phase behavior of certain mixtures that are to be used in a new process for your company. Your supervisor is relying on the group to provide a quick and thorough assessment of the proposed process each day of production delay costs the company one million dollars. 

Exposure to schedule delay costs (offshore operations)... 

Dewan, S., H. Mendelson 1990. User Delay Costs and International Pricing for a Service Facility, Management Science 36, 1502-1517. 

Work on problems with multiple classes owes much to a few seminal papers that studied optimal pricing of homogeneous customers arriving to a service facility, see for example [44], [104], and [144]. The focus is generally on determining a price that balances the delay cost to the customer and the utilization of the server. The long-term service rate is also considered in many of these papers, which is effectively a capacity decision for the facility. 

Building on this, Mendelson and Whang [105] extend [104] to include multiple classes of users, the authors derive incentive-compatible pricing controls for an M/M/1 queue with constant delay cost per unit job. As defined by Mendelson and Whang, optimal incentive-compatible means that the arrival rate and execution priorities jointly maximize the expected net value of the system while being determined on a decentralized basis , i.e., individual customers determine their service level and whether to join the queue. 

In [66], Ha initially extends [104] to include a service rate decision by homogeneous customers in a GI/GI/1 queue where FIFO (first-in first-out) scheduling is used. For example, the service rate decision may be applicable when a customer has the ability to choose an amount of preprocessing on a task that would affect the server effort required to complete the task. Ha shows that a pricing scheme with a variable fee and fixed rebate based on delay cost... 

In [67], Ha extends this work to consider multiple customer classes that differ in their demand, delay costs, and service costs. For an M/G/s processor sharing queue, he shows that a single fee dependent on the time in the system can coordinate the system, and for an M/G/1 FIFO server, coordination can be effected through a pricing scheme that is quadratic in time of service. 

S. Dewan and H. Mendelson. User delay costs and internal pricing for a service facility. Management Science, 36 1502-1517, 1990. 

Min delay cost is second in priority after max delay in cost calculation. The min delay cost calculation is independent of path groups. It is the sum of all the worst min.delay violators. The min delay violation is calculated as the difference between the expected delay and the actual delay. A violation occurs when the expected delay is greater than... 

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