Journal of Korean Institute of Industrial Engineers (대한산업공학회지)

Korean Institute of Industrial Engineers (대한산업공학회)
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Optimal Production Controls in a Two-Stage Production System with a Component Selling Option

부품 판매 옵션을 갖는 두 단계 일렬 생산 시스템에서의 최적 생산 전략

  • Kim, Eungab (College of Business Administration, Ewha Womans University)
  • 김은갑 (이화여자대학교 경영대학)
  • Received : 2015.08.04
  • Accepted : 2015.09.16
  • Published : 2015.10.15
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Abstract

This paper considers a two-stage make-to-stock production system. The first stage produces a single-component and the second stage produces a make-to-stock product using components. In addition to internal demands, the first stage faces external demands with the option of accepting or rejecting. To ration component inventory, the manufacturer adopts a static rule. This paper analyzes the production controls at both facilities that maximizes the manufacturer's profit. Using the Markov decision process model, we characterize the optimal production policy by two monotonic switching curves.

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References

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