Yuan-Shyi Peter Chiu
Department of Industrial Engineering and Management, Chaoyang University of Technology, Taichung 413, Taiwan.
Jia-Hang Jhan
Department of Industrial Engineering and Management, Chaoyang University of Technology, Taichung 413, Taiwan.
Victoria Chiu
Department of Accounting, Finance and Law, State University of New York at Oswego, Oswego, NY 13126, USA.
Singa Wang Chiu
Department of Business Administration, Chaoyang University of Technology, Taichung 413, Taiwan.
DOI https://doi.org/10.33889/IJMEMS.2020.5.4.050
Abstract
Managers of today’s transnational firms, facing competitive global business environments, always intend to optimize their intra-supply chain systems to meet customers’ multiproduct demands with perfect quality goods, timely delivery, and minimum fabrication-shipping expenses. In the production units of intra-supply chain systems, random scraps are inevitable due to various unforeseen factors. Also, since the in-house capacity is limited, implementing a partial outsourcing plan can help release machine workloads, smooth production schedule, and reduce fabrication uptime. Inspired by these facts, this study explores an intra-supply chain system with random scraps and an external source. We build a mathematical model to portray the characteristics of the studied problem. Model analyses and the renewal reward theorem help us to obtain the expected system cost function. Optimization techniques and Hessian matrix equations are used to jointly decide the optimal cycle time and shipment policy that minimize the expected system cost. Through numerical illustration, we expose the individual and joint impact of diverse system features on the optimal operating policies and other crucial parameters of the studied problem, thus, facilitate managerial decision makings.
Keywords- Industrial engineering, Production management, Outsourcing, Scrap, Intra-supply chain system, Multiple shipments.
Citation
Chiu, Y. P., Jhan, J., Chiu, V., & Chiu, S. W. (2020). Fabrication Cycle Time and Shipment Decision for A Multiproduct Intra-Supply Chain System with External Source and Scrap. International Journal of Mathematical, Engineering and Management Sciences, 5(4), 614-630. https://doi.org/10.33889/IJMEMS.2020.5.4.050.
