A Capacity Constrained Production-Inventory System with Stochastic Demand and Production Times

Research output: Contribution to journalArticle

Abstract

This paper considers a simple model of a capacity constrained production-inventory system with Poisson demand. The system is controlled by an S policy. The production time for a unit is modelled as a gamma distributed stochastic variable. Using M/G/1 queuing theory it is very easy to evaluate holding and backorder costs and optimise the ordering policy. The suggested model may be useful when evaluating investments in production.

Details

Authors
  • Sven Axsäter
Organisations
Research areas and keywords

Subject classification (UKÄ) – MANDATORY

  • Transport Systems and Logistics

Keywords

  • stochastic, production-inventory management, capacity constrained
Original languageEnglish
Pages (from-to)6203-6209
JournalInternational Journal of Production Research
Volume48
Issue number20
Publication statusPublished - 2010
Publication categoryResearch
Peer-reviewedYes