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Optimal multi-stage logistic and inventory policies with production bottleneck in a serial supply chain

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  • Hsiao, Yu-Cheng
  • Lin, Yi
  • Huang, Yun-Kuei

Abstract

Bottleneck appears in a serial supply chain if the minimum production rate at all stages is smaller than the demand rate. Operation manager must focus on keeping the bottleneck stage fully utilized and forcing the other stages to produce in synch with the bottleneck. This study applies the lot size division method, the recursive tightening method, and the drum-buffer-rope strategy. A pull and reverse pull algorithm is designed to solve the multi-stage logistic and inventory problem with a production bottleneck in a serial supply chain. A numerical example is included to illustrate the algorithm procedures.

Suggested Citation

  • Hsiao, Yu-Cheng & Lin, Yi & Huang, Yun-Kuei, 2010. "Optimal multi-stage logistic and inventory policies with production bottleneck in a serial supply chain," International Journal of Production Economics, Elsevier, vol. 124(2), pages 408-413, April.
    • Handle: RePEc:eee:proeco:v:124:y:2010:i:2:p:408-413
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    References listed on IDEAS

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    Cited by:

    1. Hoai Le Thi & Duc Tran, 2014. "Optimizing a multi-stage production/inventory system by DC programming based approaches," Computational Optimization and Applications, Springer, vol. 57(2), pages 441-468, March.
    2. Wen-Tsung Ho & Shu-Fang Lai & Yun-Kuei Huang, 2014. "An Optimal Mixed Batch Shipment Policy for Multiple Items in a Single-Supplier Multiple-Retailer Integrated System," Journal of Optimization Theory and Applications, Springer, vol. 160(2), pages 636-658, February.
    3. Wang, Kung-Jeng & Lin, Y.S. & Yu, Jonas C.P., 2011. "Optimizing inventory policy for products with time-sensitive deteriorating rates in a multi-echelon supply chain," International Journal of Production Economics, Elsevier, vol. 130(1), pages 66-76, March.

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