Dynamic scheduling to minimize lost sales subject to set-up costs

Authors:
Eungab Kim;Mark P. Van Oyen
Affiliations:
Joseph L. Rotman School of Management, University of Toronto, Toronto, Ontario, Canada M5S 3E6;Department of Industrial Engineering and Management Sciences, Northwestern University, Evanston, IL 60208-3119, USA
Venue:
Queueing Systems: Theory and Applications
Year:
1998

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Abstract

We consider scheduling a shared server in a two-class, make-to-stock, closed queueing network. We include server switching costs and lost sales costs (equivalently, server starvation penalties) for lost jobs. If the switching costs are zero, the optimal policy has a monotonic threshold type of switching curve provided that the service times are identical. For completely symmetric systems without set-ups, it is optimal to serve the longer queue. Using simple analytical models as approximations, we derive a heuristic scheduling policy. Numerical results demonstrate the effectiveness of our heuristic, which is typically within 10% of optimal. We also develop and test a heuristic policy for a model in which the shared resource is part of a series network under a CONWIP release policy.