Identification and Classification of Intermittent Demand Patterns

International Journal of Productivity and Quality Management, Vol. 6, Issue 3, 304-317, 2016

Posted: 5 Mar 2016

See all articles by Pallavi Chitturi

Pallavi Chitturi

Temple University - Department of Statisitcs

Mark Gershon

Temple University

Jing Chen

Verisk Health, Inc.

Date Written: March 3, 2016

Abstract

Intermittent demand is often defined as random demand with a large proportion of zero values (Silver, 1981). However, the terms ‘intermittent demand’, ‘lumpy demand’, and ‘erratic demand’ are used interchangeably in the literature. There is also a widely held misconception that low demand items are, by definition, intermittent in nature. In this paper, we show that the term intermittent demand includes at least three distinct sub-groups of demand patterns that we call lumpy, limited, and erratic. We define the three distinct demand patterns and provide a step-by-step method for classifying items as members of each demand pattern. We provide examples of each demand pattern using inventory data from the U.S. Navy. Finally, we discuss some preliminary strategies for dealing with each distinct demand pattern.

Keywords: intermittent demand, lumpy demand, erratic demand, limited demand, moving average

Suggested Citation

Chitturi, Pallavi and Gershon, Mark and Chen, Jing, Identification and Classification of Intermittent Demand Patterns (March 3, 2016). International Journal of Productivity and Quality Management, Vol. 6, Issue 3, 304-317, 2016, Available at SSRN: https://ssrn.com/abstract=2741960

Pallavi Chitturi (Contact Author)

Temple University - Department of Statisitcs ( email )

Philadelphia, PA 19027
United States

Mark Gershon

Temple University ( email )

Philadelphia, PA 19122
United States

Jing Chen

Verisk Health, Inc. ( email )

201 Jones Road, 4th Floor
Waltham, MA 02451
United States

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