Alternative approach for manufacturing and shipment policy making for a system with rework and a cost lessening product delivery plan

Authors:
Yuan-Shyi Peter Chiu;Singa Wang Chiu;Chih-Kai Chang;Chiu-Yen Shen
Affiliations:
Department of Industrial Engineering and Management, Chaoyang University of Technology, Taichung, Taiwan;Department of Business Administration, Chaoyang University of Technology, Taichung, Taiwan;Department of Industrial Engineering and Management, Chaoyang University of Technology, Taichung, Taiwan;Department of Business Administration, Chaoyang University of Technology, Taichung, Taiwan
Venue:
AMERICAN-MATH'12/CEA'12 Proceedings of the 6th WSEAS international conference on Computer Engineering and Applications, and Proceedings of the 2012 American conference on Applied Mathematics
Year:
2012

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Abstract

This paper uses an alternative approach to reexamine a prior study on joint determination of manufacturing lot-size and shipment policy in a vendor-buyer system with rework process and an improving delivery plan. The proposed method is a straightforward approach in terms of algebraic derivations. It is different from the conventional method that needs to apply the first-order and second-order differentiations to the system cost function for proof of convexity before derivation of the optimal production-shipment policy. The research result obtained in this paper is confirmed to be identical to what was derived by the use of the conventional method. The proposed algebraic approach may assist practitioners who may not have sufficient knowledge of differential calculus in understanding the solution procedures of such a real world integrated production-shipment problem in supply chain environments.