An Integrated Approach to Inventory and Flexible Capacity Management under Non-stationary Stochastic Demand and Set-up Costs
نویسندگان
چکیده
In a manufacturing system with flexible capacity, inventory management can be coupled with capacity management in order to handle fluctuations in demand more effectively. A typical example is the effective use of temporary workforce. In this paper, we discuss an integrated model for inventory and flexible capacity management under nonstationary stochastic demand with the possibility of positive set-up costs, both for initiating production and ordering contingent capacity. We analyze the characteristics of the optimal policies for the integrated problem. We also evaluate the value of utilizing flexible capacity under different settings, which enable us to develop managerial insights.
منابع مشابه
Optimal flexible capacity in newsboy problem under stochastic demand and lead-time
In this paper, we consider a newsvendor who is going to invest on dedicated or flexible capacity, our goal is to find the optimal investment policy to maximize total profit while the newsvendor faces uncertainty in lead time and demand simultaneously. As highlighted in literature, demand is stochastic, while lead time is constant. However, in reality lead time uncertainty decreases newsvendor's...
متن کاملIntegrated capacity and inventory management with capacity acquisition lead times
In this paper we consider a make-to-stock production system whose permanent production capacity can be increased temporarily by making use of some contingent resources, while this capacity acquisition has a constant lead time associated with it. We present a model where the capacity management problem is handled in an integrated manner with the inventory management, under non-stationary and sto...
متن کاملProduction Planning under Stochastic Time-varying Demand: Flexible Service Level Approach
Consider stochastic production-inventory control problem in which there are multiple capacity sources, multiple heterogeneous products, non-stationary demand and time-varying costs. If shortage costs can be evaluated the natural objective is to minimize expected production, inventory and shortage costs. Otherwise one can use service level requirements as target inventory while trying to minimiz...
متن کاملIntegrated Workforce Capacity and Inventory Management Under Temporary Labor Supply Uncertainty
In a manufacturing environment with volatile demand, inventory management can be coupled with dynamic capacity adjustments for handling the fluctuations more effectively. In this study, we consider the problem of integrated capacity and inventory management under non-stationary stochastic demand and flexible capacity uncertainty. The capacity planning problem is investigated from the workforce ...
متن کاملA New model for integrated lot sizing and scheduling in flexible job shop problem
In this paper an integrated lot-sizing and scheduling problem in a flexible job shop environment with machine-capacity-constraint is studied. The main objective is to minimize the total cost which includes the inventory costs, production costs and the costs of machine’s idle times. First, a new mixed integer programming model,with small bucket time approach,based onProportional Lot sizing and S...
متن کامل