Using an incentive-compatibility due-date quotation to improve the performance for one-of-a-kind production shop floors controlled by load-based pull systems

Abstract

ABSTRACT For one-of-a-kind production (OKP) manufacturers adopting an engineer-to-order or make-to-order marketing strategy, it is very important to set an appropriate due date. We design an incentive-compatibility due-date quotation procedure to help OKP manufacturers obtain the rational due-date quotation from OKP customers. Based on the rational due-date quotation decision-making, the performance of an OKP shop floor controlled by load-based pull systems is evaluated in simulation. Our findings show that if the collaboration of due-date quotations and load-based pull control is effective, the order profit of OKP manufacturers will not be reduced when the delivery delay occurs. This study can provide more insights on order quotation decision-making and pull production control for OKP manufacturers.