Determining optimal uptime considering an unreliable machine, a maximum permitted backorder level, a multi-delivery plan, and disposal/rework of imperfect items

Abstract

To remain competitive in unstable business environments, production managers of contemporary manufacturing firms must simultaneously achieve some important operating goals while planning batch fabrication. These goals may include ensuring high product quality, satisfying buyer demand with timely deliveries and acceptable stock availability, lowering cost, and keeping the batch fabrication process undisruptive. In production planning, permitting shortage backordering is an effective policy to reduce stock holding cost, given that stock availability meets an acceptable level of customer’s satisfaction. In addition, in an actual manufacturing environment, random equipment breakdowns and imperfect items are inevitable due to unpredictable issues in manufacturing processes. This study develops a decision support model to explore a fabrication uptime problem considering an unreliable machine, a maximum permitted backorder level, a multi-delivery plan, and disposal/rework of imperfect items to assist manages with the aforementioned operating goals. With the help of mathematical modeling, an optimization method, and a solution-seeking algorithm, the proposed precise model is capable of not only determining the optimal fabrication uptime policy, but also revealing the individual and joint impact(s) of various key system parameters on the problem, thus facilitating managerial decision-making.