Optimum ordering policy for an imperfect single-stage manufacturing system with safety stock and planned backorder

Optimum ordering policy for an imperfect single-stage manufacturing system with safety stock and... Manufacturing industries prefer to produce extra units as safety stock especially when demand for these units varies. The phenomena of producing additional units is also observed when processes are imperfect and production managers are sure that product can be consumed in market. In addition, customer is also willing to wait for demands to be backordered in the case of shortages. However, inventory carrying and backordering costs may play vital role if products are produced in relatively large amount. Therefore, a mathematical model is needed that can define the ordered quantity taking safety stock and planned backordering into consideration with imperfect production setup. This paper is an attempt towards development of such mathematical model that considers safety stock, lot size, and planned backorders for a single-stage imperfect production setup. Mathematical model is developed based on minimization of total average cost function. Three decision variables including order quantity, safety stock, and planned backorders have been optimized simultaneously using classical optimization approach. Numerical examples are used to illustrate the proposed model for calculation of decision variables. Impact of changes in processes imperfection, holding costs, and backordering costs over variables have been numerically computed to highlight model significance in daily industrial life. Results prove that safety stock and planned backorder reduce the total cost significantly. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png The International Journal of Advanced Manufacturing Technology Springer Journals

Optimum ordering policy for an imperfect single-stage manufacturing system with safety stock and planned backorder

Loading next page...
 
/lp/springer_journal/optimum-ordering-policy-for-an-imperfect-single-stage-manufacturing-AvTSmKzMML
Publisher
Springer London
Copyright
Copyright © 2017 by Springer-Verlag London Ltd.
Subject
Engineering; Industrial and Production Engineering; Media Management; Mechanical Engineering; Computer-Aided Engineering (CAD, CAE) and Design
ISSN
0268-3768
eISSN
1433-3015
D.O.I.
10.1007/s00170-017-1065-8
Publisher site
See Article on Publisher Site

Abstract

Manufacturing industries prefer to produce extra units as safety stock especially when demand for these units varies. The phenomena of producing additional units is also observed when processes are imperfect and production managers are sure that product can be consumed in market. In addition, customer is also willing to wait for demands to be backordered in the case of shortages. However, inventory carrying and backordering costs may play vital role if products are produced in relatively large amount. Therefore, a mathematical model is needed that can define the ordered quantity taking safety stock and planned backordering into consideration with imperfect production setup. This paper is an attempt towards development of such mathematical model that considers safety stock, lot size, and planned backorders for a single-stage imperfect production setup. Mathematical model is developed based on minimization of total average cost function. Three decision variables including order quantity, safety stock, and planned backorders have been optimized simultaneously using classical optimization approach. Numerical examples are used to illustrate the proposed model for calculation of decision variables. Impact of changes in processes imperfection, holding costs, and backordering costs over variables have been numerically computed to highlight model significance in daily industrial life. Results prove that safety stock and planned backorder reduce the total cost significantly.

Journal

The International Journal of Advanced Manufacturing TechnologySpringer Journals

Published: Oct 12, 2017

References

You’re reading a free preview. Subscribe to read the entire article.


DeepDyve is your
personal research library

It’s your single place to instantly
discover and read the research
that matters to you.

Enjoy affordable access to
over 18 million articles from more than
15,000 peer-reviewed journals.

All for just $49/month

Explore the DeepDyve Library

Search

Query the DeepDyve database, plus search all of PubMed and Google Scholar seamlessly

Organize

Save any article or search result from DeepDyve, PubMed, and Google Scholar... all in one place.

Access

Get unlimited, online access to over 18 million full-text articles from more than 15,000 scientific journals.

Your journals are on DeepDyve

Read from thousands of the leading scholarly journals from SpringerNature, Elsevier, Wiley-Blackwell, Oxford University Press and more.

All the latest content is available, no embargo periods.

See the journals in your area

DeepDyve

Freelancer

DeepDyve

Pro

Price

FREE

$49/month
$360/year

Save searches from
Google Scholar,
PubMed

Create lists to
organize your research

Export lists, citations

Read DeepDyve articles

Abstract access only

Unlimited access to over
18 million full-text articles

Print

20 pages / month

PDF Discount

20% off