A Receding Optimization Control Policy for Production Systems with Quadratic Inventory Costs

Abstract

For stochastic disturbance, such as stochastic demands and breakdown of the system, the production systems is presented as a piecewise deterministic process model. At any given time only one type of product can be produced by the system. A setup (with setup time and cost) is required if production is to be switched from one type of product to another. Preventive maintenance activity is performed for reducing the aging of the system, and the jump rates of the system state depend on the aging of the system. The objective of the problem is to minimize the costs of setup, production, maintenance and the quadratic costs of inventory. The decision variables are a sequence of setups and the production and preventive maintenance plan. According to two time horizons, the original problem is decomposed into two sub-problems. The asymptotic optimality solution of the original problem is constructed via receding optimize the sub-problems. Simulation results show the feasibility of the proposed approach in practice.