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Growing Science » International Journal of Industrial Engineering Computations » A vendor-buyer coordinated system featuring an unreliable machine, scrap, outsourcing, and multiple shipments

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International Journal of Industrial Engineering Computations

ISSN 1923-2934 (Online) - ISSN 1923-2926 (Print)
Quarterly Publication
Volume 11 Issue 3 pp. 341-358 , 2020

A vendor-buyer coordinated system featuring an unreliable machine, scrap, outsourcing, and multiple shipments Pages 341-358 Right click to download the paper Download PDF

Authors: Yuan-Shyi Peter Chiu, Zhong-Yun Zhao, Singa Wang Chiu, Victoria Chiu

DOI: 10.5267/j.ijiec.2020.1.004

Keywords: Fabrication runtime, Unreliable machine, Outsourcing, Vendor-buyer coordinated system, Multi-shipment, Scrap

Abstract: Operating in today’s highly competitive global markets, transnational enterprises always seek to optimize internal vendor-buyer coordinated systems to ensure timeliness and quality deliveries, given the reality of unreliable machines and limited capacity. To facilitate accurate decision making to help organizations gain competitive advantages in such situations, this study explores an intra-supply-chain problem featuring a partial outsourcing batch fabrication plan, random scrap, Poisson-distributed breakdown rate, and multiple shipments of end-product. First, we build a model to characterize the problem clearly. Then, we carry out formulations, analyses, and derivations of the model to attain the problem’s cost function. We then use differential calculus and propose a specific algorithm to confirm the convexity of the obtained cost function and derive the optimal runtime. Finally, we offer a numerical illustration to demonstrate the result’s applicability for other business circumstances. Additional elements of the problem are then discussed, including the individual and combined influence of variations in scrap, outsourcing, breakdown, and shipping frequency. The features of an optimal operating policy and cost relevant parameters are now revealed to assist management with strategic planning and decision making in real-world intra-supply-chain environments.



How to cite this paper
Chiu, Y., Zhao, Z., Chiu, S & Chiu, V. (2020). A vendor-buyer coordinated system featuring an unreliable machine, scrap, outsourcing, and multiple shipments.International Journal of Industrial Engineering Computations , 11(3), 341-358.

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Journal: International Journal of Industrial Engineering Computations | Year: 2020 | Volume: 11 | Issue: 3 | Views: 1393 | Reviews: 0

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