Minimizing operating expenditures for a manufacturing system featuring quality reassurances, probabilistic failures, overtime, and outsourcing

Abstract

Production management operating in recent competitive marketplaces must satisfy the client desired quality and shorter order lead-time and avoid internal fabricating disruption caused by inevitable defects and stochastic equipment failures. Achieving these operational tasks without undesirable quality goods, missing due dates, and fabrication interruption help the management minimize operating expenditures. Motivated by assisting manufacturing firms in the situations mentioned this study explores a manufacturing system that features quality reassurances through reworking or removal of defectives, correction of probabilistic failures, and partial overtime and outsourcing options for reducing uptime. This study finds the function of system operating expenditures through model building, mathematical formulations, optimization approaches, and algorithm proposition, shows its convexity, and derives the optimal batch time for the studied manufacturing model. Finally, this study offers numerical illustrations to confirm our work’s applicability and disclose its capability to provide various profound crucial system information that helps the management make strategic operating decisions.