IDEAS home Printed from https://ideas.repec.org/a/eee/proeco/v147y2014ipap38-45.html
   My bibliography  Save this article

Modeling cost benefit analysis of inspection in a production line

Author

Listed:
  • Tirkel, Israel
  • Rabinowitz, Gad

Abstract

Production management aims to maximize profit by increasing salable output while reducing the cost related with inspection, where inspection is defined as the measurement and quality assessment of items produced. This study is based on a semiconductor production line with consecutive deteriorating machines. Each machine is inspected via the items it produces and an inspection result triggers a machine's repair, if needed. Inspection related cost includes fixed and variable cost of inspection capacity, Yield Loss Cost generated due to unsalable throughput, and delivery delay cost caused by inspection flow-time. The effects of inspection capacity and inspection rate on cost are investigated using analytical and simulation models. Under a given inspection capacity, Yield Loss Cost decreases with growing inspection rate until a minimum is reached, and then starts to increase with further growing rate. This increase is explained by the impact of higher load on the inspection facility, which prolongs the inspection response time. Thus, an optimal inspection rate can be derived for a given inspection capacity. It will be shown that the higher the capacity, the higher the optimal rate, and the lower the yield loss. Determination of optimal inspection capacity considers the capacity cost against the other costs and minimizes the total expected inspection related costs.

Suggested Citation

  • Tirkel, Israel & Rabinowitz, Gad, 2014. "Modeling cost benefit analysis of inspection in a production line," International Journal of Production Economics, Elsevier, vol. 147(PA), pages 38-45.
    • Handle: RePEc:eee:proeco:v:147:y:2014:i:pa:p:38-45
    DOI: 10.1016/j.ijpe.2013.05.012
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0925527313002387
    Download Restriction: Full text for ScienceDirect subscribers only
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Araz, Ceyhun & Ozkarahan, Irem, 2007. "Supplier evaluation and management system for strategic sourcing based on a new multicriteria sorting procedure," International Journal of Production Economics, Elsevier, vol. 106(2), pages 585-606, April.
    2. Haque, Lani & Armstrong, Michael J., 2007. "A survey of the machine interference problem," European Journal of Operational Research, Elsevier, vol. 179(2), pages 469-482, June.
    3. Li, Na & Zhang, Mike Tao & Deng, Shiming & Lee, Zu-Hsu & Zhang, Lawrence & Zheng, Li, 2007. "Single-station performance evaluation and improvement in semiconductor manufacturing: A graphical approach," International Journal of Production Economics, Elsevier, vol. 107(2), pages 397-403, June.
    4. Wang, Hongzhou, 2002. "A survey of maintenance policies of deteriorating systems," European Journal of Operational Research, Elsevier, vol. 139(3), pages 469-489, June.
    5. Tang, Christopher S., 2006. "Perspectives in supply chain risk management," International Journal of Production Economics, Elsevier, vol. 103(2), pages 451-488, October.
    6. Hu, Fei & Zong, Qun, 2009. "Optimal production run time for a deteriorating production system under an extended inspection policy," European Journal of Operational Research, Elsevier, vol. 196(3), pages 979-986, August.
    7. Gunasekaran, A. & Sarhadi, M., 1998. "Implementation of activity-based costing in manufacturing," International Journal of Production Economics, Elsevier, vol. 56(1), pages 231-242, September.
    8. Liao, Gwo-Liang, 2007. "Optimal production correction and maintenance policy for imperfect process," European Journal of Operational Research, Elsevier, vol. 182(3), pages 1140-1149, November.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Guo, Chiquan & Wang, Yong J. & Metcalf, Ashley, 2014. "How to calibrate conventional market-oriented organizational culture in 21st century production-centered firms? A customer relationship perspective," International Journal of Production Economics, Elsevier, vol. 156(C), pages 235-245.
    2. Puchkova, Alena & McFarlane, Duncan & Srinivasan, Rengarajan & Thorne, Alan, 2020. "Resilient planning strategies to support disruption-tolerant production operations," International Journal of Production Economics, Elsevier, vol. 226(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Andrei Sleptchenko & M. Eric Johnson, 2015. "Maintaining Secure and Reliable Distributed Control Systems," INFORMS Journal on Computing, INFORMS, vol. 27(1), pages 103-117, February.
    2. Trkman, Peter & McCormack, Kevin, 2009. "Supply chain risk in turbulent environments--A conceptual model for managing supply chain network risk," International Journal of Production Economics, Elsevier, vol. 119(2), pages 247-258, June.
    3. Chakravarthy, Srinivas R., 2012. "Maintenance of a deteriorating single server system with Markovian arrivals and random shocks," European Journal of Operational Research, Elsevier, vol. 222(3), pages 508-522.
    4. Kuzu, Kaan & Li, Wanxi, 2016. "Exploring supplier performance risk and the buyer's role using chance-constrained data envelopment analysisAuthor-Name: Ross, Anthony D," European Journal of Operational Research, Elsevier, vol. 250(3), pages 966-978.
    5. de Jonge, Bram & Scarf, Philip A., 2020. "A review on maintenance optimization," European Journal of Operational Research, Elsevier, vol. 285(3), pages 805-824.
    6. Jie Wu & Zhixin Chen & Xiang Ji, 2020. "Sustainable trade promotion decisions under demand disruption in manufacturer-retailer supply chains," Annals of Operations Research, Springer, vol. 290(1), pages 115-143, July.
    7. Gunasekaran, Angappa & Irani, Zahir & Choy, King-Lun & Filippi, Lionel & Papadopoulos, Thanos, 2015. "Performance measures and metrics in outsourcing decisions: A review for research and applications," International Journal of Production Economics, Elsevier, vol. 161(C), pages 153-166.
    8. Hashemi, M. & Asadi, M. & Zarezadeh, S., 2020. "Optimal maintenance policies for coherent systems with multi-type components," Reliability Engineering and System Safety, Elsevier, vol. 195(C).
    9. Xiang, Yisha, 2013. "Joint optimization of X¯ control chart and preventive maintenance policies: A discrete-time Markov chain approach," European Journal of Operational Research, Elsevier, vol. 229(2), pages 382-390.
    10. Coria, V.H. & Maximov, S. & Rivas-Dávalos, F. & Melchor, C.L. & Guardado, J.L., 2015. "Analytical method for optimization of maintenance policy based on available system failure data," Reliability Engineering and System Safety, Elsevier, vol. 135(C), pages 55-63.
    11. Tang, Liang & Jing, Ke & He, Jie & Stanley, H. Eugene, 2016. "Robustness of assembly supply chain networks by considering risk propagation and cascading failure," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 459(C), pages 129-139.
    12. Hsu, Jia-Tzer & Hsu, Lie-Fern, 2013. "An EOQ model with imperfect quality items, inspection errors, shortage backordering, and sales returns," International Journal of Production Economics, Elsevier, vol. 143(1), pages 162-170.
    13. Zhao, Na, 2019. "Managing interactive collaborative mega project supply chains under infectious risks," International Journal of Production Economics, Elsevier, vol. 218(C), pages 275-286.
    14. Berrade, M.D. & Cavalcante, C.A.V. & Scarf, P.A., 2013. "Modelling imperfect inspection over a finite horizon," Reliability Engineering and System Safety, Elsevier, vol. 111(C), pages 18-29.
    15. Boulaksil, Youssef, 2016. "Safety stock placement in supply chains with demand forecast updates," Operations Research Perspectives, Elsevier, vol. 3(C), pages 27-31.
    16. Seyed Habib A. Rahmati & Abbas Ahmadi & Kannan Govindan, 2018. "A novel integrated condition-based maintenance and stochastic flexible job shop scheduling problem: simulation-based optimization approach," Annals of Operations Research, Springer, vol. 269(1), pages 583-621, October.
    17. Wu, Shaomin & Scarf, Philip, 2015. "Decline and repair, and covariate effects," European Journal of Operational Research, Elsevier, vol. 244(1), pages 219-226.
    18. Hassan Arabshahi & Hamed Fazlollahtabar, 2018. "Classifying Innovative Activities Using Decision Tree and Gini Index," International Journal of Innovation and Technology Management (IJITM), World Scientific Publishing Co. Pte. Ltd., vol. 15(03), pages 1-14, June.
    19. Li, Yongjian & Zhen, Xueping & Qi, Xiangtong & Cai, Gangshu (George), 2016. "Penalty and financial assistance in a supply chain with supply disruption," Omega, Elsevier, vol. 61(C), pages 167-181.
    20. Laurent Lim, Lâm & Alpan, Gülgün & Penz, Bernard, 2014. "Reconciling sales and operations management with distant suppliers in the automotive industry: A simulation approach," International Journal of Production Economics, Elsevier, vol. 151(C), pages 20-36.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:proeco:v:147:y:2014:i:pa:p:38-45. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Nithya Sathishkumar). General contact details of provider: http://www.elsevier.com/locate/ijpe .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.