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Partial Characterization of Optimal Hedging Point Policies in Unreliable Two-Part-Type Manufacturing Systems

Author

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  • N. Srivatsan

    (Intel Corporation, Chandler, Arizona)

  • Yves Dallery

    (Université Pierre et Marie Curie, Paris, France)

Abstract

The production control problem in unreliable manufacturing systems has generated a great deal of interest recently. The goal is the real-time calculation of production rates to minimize total expected surplus and backlog costs in a production system. A class of feedback control policies, called hedging point policies, has been studied in literature and shown to be optimal for certain single-part-type systems. This paper focuses mainly on the performance of hedging point policies in two-part-type systems. We first generalize known stability results for hedging point policies in single-part-type systems and extend them to two-part-type systems. An average cost analysis of trajectories is then used to partially characterize an optimal policy belonging to this class. A complete characterization is obtained for special parameter values. The results in this paper provide insights for designing simple yet effective heuristics for controlling manufacturing systems producing many part-types.

Suggested Citation

  • N. Srivatsan & Yves Dallery, 1998. "Partial Characterization of Optimal Hedging Point Policies in Unreliable Two-Part-Type Manufacturing Systems," Operations Research, INFORMS, vol. 46(1), pages 36-45, February.
    • Handle: RePEc:inm:oropre:v:46:y:1998:i:1:p:36-45
    DOI: 10.1287/opre.46.1.36
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    References listed on IDEAS

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    1. Michael H. Veatch & Lawrence M. Wein, 1996. "Scheduling a Make-To-Stock Queue: Index Policies and Hedging Points," Operations Research, INFORMS, vol. 44(4), pages 634-647, August.
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    Cited by:

    1. Polotski, V. & Kenne, J.-P. & Gharbi, A., 2019. "Joint production and maintenance optimization in flexible hybrid Manufacturing–Remanufacturing systems under age-dependent deterioration," International Journal of Production Economics, Elsevier, vol. 216(C), pages 239-254.
    2. Vladimir Polotski & Jean-Pierre Kenne & Ali Gharbi, 2017. "Set-up and production planning in hybrid manufacturing–remanufacturing systems with large returns," International Journal of Production Research, Taylor & Francis Journals, vol. 55(13), pages 3766-3787, July.
    3. Chen Shaoxiang, 2004. "The Optimality of Hedging Point Policies for Stochastic Two-Product Flexible Manufacturing Systems," Operations Research, INFORMS, vol. 52(2), pages 312-322, April.
    4. Francis De Vericourt & Fikri Karaesmen & Yves Dallery, 2000. "Dynamic Scheduling in a Make-to-Stock System: A Partial Characterization of Optimal Policies," Operations Research, INFORMS, vol. 48(5), pages 811-819, October.
    5. S. P. Sethi & H. Yan & H. Zhang & Q. Zhang, 2002. "Optimal and Hierarchical Controls in Dynamic Stochastic Manufacturing Systems: A Survey," Manufacturing & Service Operations Management, INFORMS, vol. 4(2), pages 133-170.

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