Production and Operations Management 2003

ANALYSIS OF THE LEAD TIME AND LEARNING FOR CAPACITY EXPANSIONS

Cheryl Gaimon^1,2; Robert H. Burgess^1,3

¹ Georgia Institute of Technology · ² Technology Management Company (United States) · ³ The Centers

Abstract

Firms capable of reducing the time required to bring new products to the marketplace realize significant competitive gains. In this context, the existing literature on capacity expansion is limited because it does not consider the lead time required to construct and operationalize new capacity. Models are introduced here that capture the capacity expansion lead time as well as two types of learning. Specifically, learning may reduce the lead time or cost required to complete an expansion. Analytic and numerical results show that the optimal solution can be significantly affected by the explicit treatment of the lead time and learning.

DOI

10.1111/j.1937-5956.2003.tb00202.x

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APA 7 MLA 9 Chicago (author–date) Harvard Elsevier Harvard (JFE, JBF…) The Accounting Review Academy of Management American Marketing Association INFORMS (Management Science) Copy citation Copied ✓