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Dynamic Inventory Pooling Policies To Deliver Differentiated Service, Yuanguang Zhong, Zhichao Zheng, Mabel C. Chou, Chung-Piaw Teo

Research Collection Lee Kong Chian School Of Business

Resource pooling strategies have been widely used in industry to match supply with demand. However, effective implementation of these strategies can be challenging. Firms need to integrate the heterogeneous service level requirements of different customers into the pooling model and allocate the resources (inventory or capacity) appropriately in the most effective manner. The traditional analysis of inventory pooling, for instance, considers the performance metric in a centralized system and does not address the associated issue of inventory allocation. Using Blackwell’s Approachability Theorem, we derive a set of necessary and sufficient conditions to relate the fill rate requirement of each customer …