Hedging policies for failure-prone manufacturing systems: Optimality of jit and bounds on buffer levels

James R. Perkins, R. Srikant

Research output: Contribution to journalArticlepeer-review

Abstract

The authors consider multiple part-type single-machine manufacturing systems subject to failures. They provide necessary conditions and sufficient conditions for the optimality of just-in-time (JIT) manufacturing and further show that the necessary and sufficient conditions coincide when the backlog costs for all the parts are equal. In general, finding optimal hedging policies for multiple part-type problems is extremely difficult. They provide bounds on the optimal hedging points and also prove that, under an optimal hedging policy, the buffer levels will be upper bounded.

Original languageEnglish (US)
Pages (from-to)953-957
Number of pages5
JournalIEEE Transactions on Automatic Control
Volume43
Issue number7
DOIs
StatePublished - Dec 1 1998

Keywords

  • Failure-prone machine
  • Fluid models
  • Hedging policy
  • Manufacturing systems
  • Stochastic control

ASJC Scopus subject areas

  • Control and Systems Engineering
  • Computer Science Applications
  • Electrical and Electronic Engineering

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