Int. J. Production Economics 83 (2003) 65–84 Freezing the master production schedule under single resource constraint and demand uncertainty Jinxing Xie a , Xiande Zhao b, *, T.S. Lee b a Department of Mathematical Sciences, Tsinghua University, Beijing 100084, China b Department of Decision Sciences and Managerial Economics, Chinese University of Hong Kong, Shatin, N.T., Hong Kong, China Received 5 May 2000; accepted 16 May 2002 Abstract This paper investigates the impact of freezing the master production schedule (MPS) in multi-item single-level systems with a single resource constraint under demand uncertainty. It also examines the impact of environmental factors on the selection of MPS freezing parameters. A computer model is built to simulate master production scheduling activities in a multi-item system under a rolling time horizon. The result of the study shows that the parameters for freezing the MPS have a significant impact on total cost, schedule instability and the service level of the system. Furthermore, the selection of freezing parameters is also significantly influenced by some environmental factors such as capacity tightness and cost structure. While some findings concerning the performance of MPS freezing parameters without capacity constraints can be generalised to the case of limited capacity, other conclusions under capacity constraints are different from those without capacity constraints. r 2002 Published by Elsevier Science B.V. Keywords: Master production scheduling; Capacitated lot sizing; Schedule instability; Computer simulation 1. Introduction Master production scheduling is a very impor- tant activity in manufacturing planning and control. The quality of the master production schedule (MPS) can significantly influence the total cost, schedule instability and service level of a production inventory system. The MPS drives the material requirements planning (MRP) system and provides the important link between the forecast- ing, order entry and production planning activities on the one hand, and the detailed planning and scheduling of components and raw materials on the other hand. Frequent adjustments to the MPS can induce major changes in the detailed MRP schedules. These changes can lead to increases in production and inventory costs and deterioration in customer service level. This phenomenon is called ‘‘schedule instability’’ or ‘‘MRP nervousness’’. Maintaining a stable MPS in view of changing customer requirements, adjustments in sales forecasts, and unforeseen suppliers or production problems is a difficult proposition for many firms (Sridharan et al., 1988). *Corresponding author. Tel.: +85226097650; fax: +85226 036840. E-mail addresses: jxie@math.tsinghua.edu.cn (J. Xie), xian- de@baf.msmail.cuhk.edu.hk (X. Zhao), tslee@baf.msmail.cuh- k.edu.hk (T.S. Lee). 0925-5273/02/$-see front matterr 2002 Published by Elsevier Science B.V. PII:S0925-5273(02)00262-1