## About lot sizingThere is a lot of literature about the lot sizing techniques, starting from 1913 when Thomas Harris invented the economic order quantity locution. The EOQ wants to be a scientific concept, a quantity determined minimizing a cost function. The cost function take into account, in the original formulation, the stock keeping costs and the ordering costs for the new order.The EOQ formula is explained in every operations management book and is taught in many university courses, despite great conceptual limits in the problem formulation and the lean thinking movement. The economic order quantity calculation is based on the availability of data which are difficult to collect and that vary with time, as the capital interest rate and the ordering cost. Moreover there are many simplifying hypotheses underlying the EOQ calculation. These make the formula simple and understandable but constrain its validity. Here are some of these limitations: |