1. Matching Supply with Demand: An Introduction to Operations Management Gérard Cachon ChristianTerwiesch
All slides in this file are copyrighted by Gerard Cachon and Christian Terwiesch. Any instructor that adopts Matching Supply with Demand: An Introduction to Operations Management as a required text for their course is free to use and modify these slides as desired. All others must obtain explicit written permission from the authors to use these slides.

2. O’Neill’s Hammer 3/2 wetsuit

3. Hammer 3/2 timeline and economics

4. Oneill data

5. Oneill data

6. Forecasts vs actual graph
Forecasts and actual demand for surf wet-suits from the previous season

7. Empirical distribution function for the Hammer 3/2 using historical A/F ratios

8. A portion of the Standard Normal Distribution Function Table, F(z).

9. Empirical vs normal demand distribution
Empirical distribution function (diamonds) and normal distribution function with
mean 3192 and standard deviation 1181 (solid line)

10. Balancing the risk and benefit of ordering a unit

11. Hammer 3/2's expected loss sales table if the empirical distribution is the demand forecast

12. Performance measures relationship
Expected demand, m
Fill rate
If Normal demand, s
Expected sales
Loss function table
Expected lost sales
Order quantity, Q, and, if Normal demand, z = (Q – m)/s
Exp. left over inventory
Expected profit
In-stock probability
Distribution function table
Stockout probability
Price, cost, salvage value

13. Service measures of performance

14. Pareto curve