Joint investment in quality improvement and setup reduction

Hong, Jae‐Dong; Hayya, Jack C.

doi:10.1016/0305-0548(94)00054-c

Cited by 51 publications

(19 citation statements)

References 7 publications

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“…His work has encouraged many researchers to deal with modelling the quality improvement problems (e.g. Keller and Noori 1988, Hwang et al 1993, Moon 1994, Hong and Hayya 1995, Ouyang and Chang 1999. In these papers, a common approach that has been utilized to establish the new total cost function for a quality improvement model is to add the costs of capital invested in improving process quality to the system operating costs (such as the setup cost, holding cost, etc.…”

Section: Introductionmentioning

confidence: 99%

Fuzzy opportunity cost for EOQ model with quality improvement investment

Chang¹

2003

International Journal of Systems Science

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The cost of capital (i.e. opportunity cost) is one of the key factors that will influence the inventory and investment decisions. Previously, the classical EOQ model has been extended to include an imperfect production process and quality improvement investment, where the opportunity cost rate (interest rate or discounted rate) for evaluating the cost of capital investment is known with certainty. However, in some practical situations, the opportunity cost rate probably incurs disturbance due to the unstable environments. To capture this reality, this paper attempts to combine the statistical technique and fuzzy sets concept to deal with the unstable opportunity cost rate, so as to modify the aforementioned inventory/investment model. We derive the optimal lot size and the optimal process quality level in the fuzzy sense utilizing the logarithmic investment cost function. A numerical example is provided, and the results are compared with those obtained from a crisp opportunity cost rate model.

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Section: Introductionmentioning

confidence: 99%

Fuzzy opportunity cost for EOQ model with quality improvement investment

Chang¹

2003

International Journal of Systems Science

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“…Hwang et al (1993) studied the multiproduct economic lot size models in which setup reduction and quality improvement can be achieved with a one-time initial investment. Hong and Hayya (1995) presented a model including a budget constraint and other types of continuous functions for quality enhancement and setup cost reduction. Ouyang and Chang (2000) investigated the impact of quality improvement on the modified lot size reorder point models involving variable lead time and partial backorders.…”

Section: Introductionmentioning

confidence: 99%

Integrated supply chain inventory model with quality improvement involving controllable lead time and backorder price discount

Jindal¹,

Solanki²

2016

10.5267/j.ijiec

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For the past four decades the integrated vendor and buyer supply chain inventory model has been an interesting topic, but quality improvement of defective items in the integrated inventory model with backorder price discount involving controllable lead time has been rarely discussed. The aim of this paper is to minimize the total related cost in the continuous review model by considering the order quantity, reorder point, lead time, process quality, backorder price discount and number of shipment as decision variables. Moreover, we assume that an investment function is used to improve the process quality. The lead time demand follows a normal distribution. In addition, the buyer offers backorder price discount to motivate the customers for possible backorders. There are some defective items in the arrival lot, so its treatment is also taken in account in this paper. We develop an iterative procedure for finding the optimal values of decision variables and numerical example is presented to illustrate the solution procedure. Additionally, sensitivity analysis with respect to major parameters is also carried out.

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“…Hwang et al [37] studied the multiproduct economic lot size models in which setup reduction and quality improvement can be achieved with a one-time initial investment. Hong and Hayya [38] presented a model including a budget constraint and other types of continuous functions for quality enhancement and setup cost reduction. Ouyang and Chang [39] investigated the impact of quality improvement on the modified lot size reorder point models involving variable lead time and partial backorders.…”

Section: Literature Reviewmentioning

confidence: 99%

“…Tripathy et al [41] presented an EOQ model with an imperfect production process and the unit production cost is directly related to process reliability and inversely related to the demand rate. The relative models [34][35][36][37][38][39][40][41] that tackled quality improvement focused on the classical EOQ/EPQ model. These models neglect the opportunity of commonalities to obtain a better control on the system.…”

Section: Literature Reviewmentioning

confidence: 99%

Effects of process commonalities in production system under various uncertain factors

Wazed

Ahmed

Nukman

2009

2009 International Conference for Technical Postgraduates (TECHPOS)

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Abstract-In this paper, the authors studied the effects of process commonality and uncertain factors (viz. lead time, machine breakdown etc.) on deliverable parameters of a multi product, multi-period and multistage production system. The throughput of finished products and average production time of the system are examined. Simulation models are developed, verified and validated with the historical data from a company. Simulation package, namely WITNESS is used for this research. Analyses show that enclosure of common process in manufacturing system is always beneficial over the noncommonality environment, especially i) in uncertain situations, ii) for long procurement lead time of components and iii) when the number of parts increase in the system. The combination of uncertain factors has more impact on outcomes (throughput and average production time) compared to the individual factor.

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Joint investment in quality improvement and setup reduction

Cited by 51 publications

References 7 publications

Fuzzy opportunity cost for EOQ model with quality improvement investment

Fuzzy opportunity cost for EOQ model with quality improvement investment

Integrated supply chain inventory model with quality improvement involving controllable lead time and backorder price discount

Effects of process commonalities in production system under various uncertain factors

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