Many firms face environments with long production lead times, great product variety, and uncertain, non-stationary demand. A challenge is how to plan production and inventories to provide competitive customer service at least cost. In this paper, we first describe an application at Teradyne in which we implemented an inventory hedge to protect against cyclic demand variability. Based on this ex...

This paper implements the inventory model developed in the first part of this paper in a simplified problem to simultaneously reduce costs and risks in JIT systems. This model is developed to ascertain an optimal ordering strategy for procuring raw materials by using regular multi-external and local backup suppliers to reduce the total cost of the products, and at the same time to reduce the ri...

We consider a production control problem in a manufacturing system with failure-prone machines and a constant demand rate. The objective is to minimise a discounted inventory holding and backlog cost over an infinite planning horizon. The availability of the machines is improved through a corrective maintenance strategy. The decision variables are the production and the machine repair rates, wh...

We consider a serial production system controlled by the base-stock policy, in which customer demands must be satisfied immediately or it will be considered lost. Since the exact analysis is impossible for the general system,we present a phase-type approximation for a base-stock controlled serial production system. The numerical results indicate that this approximation provides good estimates f...

This paper focuses on an inventory model considering imperfect manufacturing and re-manufacturing system under single management. In manufacturing system, the items are produced from original raw materials but in re-manufacturing process, returned and defective items produced in previous manufacturing process are the raw materials. Both the production system shift from ‘ in control state ‘ to ‘...

In the classical inventory models, the common unrealistic assumption is that all the items produced are of good quality in nature. However, in realistic environment, it can be observed that there may be some defective items in an ordered lot. These items are usually picked up during the screening process and are sold as a single lot at the end of screening process. Further, it is tacitly assume...

Recently, in Mathematical and Computational Applications Journal Chiu et al. [1] and Chen and Chiu [2] propose an inventory model based on EPQ with rework to determine the replenishment lot size and the number of shipments for a vendor-buyer integrated production-inventory system. They solve the inventory problem by considering both variables as continuous. However, the number of shipments must...

Stability is a fundamental design property of inventory systems. However, the often exploited linearity assumptions in the current literature create a major gap between theory and practice. In this paper the stability of a constrained production and inventory system with a Forbidden Returns constraint (that is, a non-negative order rate) is studied via a piecewise linear model, an eigenvalue an...

This paper aims to investigate the integrated production/distribution and inventory planning for perishable products with fixed life time in the constant condition of storage throughout a two-echelon supply chain by integrating producers and distributors. This problem arises from real environment in which multi-plant with multi-function lines produce multi-perishable products with fixed life ti...