A Production Planning Model for an Unreliable Production Facility: Case of Finite Horizon and Single Demand

European Journal of Operational Research, , 143, 94-114, 2002.

35 Pages Posted: 9 Nov 2008

See all articles by Mohsen Elhafsi

Mohsen Elhafsi

University of California-Riverside

Abstract

We study a two-level inventory system that is subject to failures and repairs. The objective is to minimize the expected total cost so as to determine the production plan for a single quantity demand. The expected total cost consists of the inventory carrying costs for finished and unfinished items, the backlog cost for not meeting the demand due-date, and the planning costs associated with the ordering schedule of unfinished items. The production plan consists of the optimal number of lot sizes, the optimal size for each lot, the optimal ordering schedule for unfinished items, and the optimal due-date to be assigned to the demand. To gain insight, we solve special cases and use their results to device an efficient solution approach for the main model. The models are solved to optimality and the solution is either obtained in closed form or through very efficient algorithms.

Keywords: Production Planning, Inventory Control, Lot Sizing, Stochastic, Optimization

Suggested Citation

Elhafsi, Mohsen, A Production Planning Model for an Unreliable Production Facility: Case of Finite Horizon and Single Demand. European Journal of Operational Research, , 143, 94-114, 2002., Available at SSRN: https://ssrn.com/abstract=1298072 or http://dx.doi.org/10.2139/ssrn.1298072

Mohsen Elhafsi (Contact Author)

University of California-Riverside ( email )

School of Business
900 University Avenue
Riverside, CA 92521
United States
951 827 4557 (Phone)
951 827 3970 (Fax)

HOME PAGE: http://https://profiles.ucr.edu/app/home/profile/melhafsi

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