Analysing optimum push/pull junction point location using multiple criteria decision‐making for multistage stochastic production system

Abstract

This research focuses on solving the multistage process push/pull junction point location problem. An aim is to implement a hybrid push/pull production system that can satisfy both high service‐levels and low inventory levels. Simultaneously, we consider sophisticated variability, such as multi‐products, random setup, indiscriminate break‐downs, yield loss, batch processes, and other contingencies. The problem can be solved by a multiple criteria decision‐making (MCDM) method. A technique for order‐preference by similarity‐to‐ideal solution (TOPSIS) is used to select a suitable option. The optimisation involves evaluation of stochastic performance measures within alternative scenarios among candidate junction‐point locations using a discrete event simulation model. A practical thin film transistor‐liquid crystal display (TFT‐LCD) process case‐study is utilised to illustrate the proposed method. After implementing a hybrid push/pull production strategy, simulation results indicate that the inventory level was reduced by over 18% while the service level remained about the same. For another scenario, a 3.4% decrease in service‐level can be paid off by a 46% decrease in inventory level and 34% improvement in lead time.