Economic Production Cycles with Imperfect Production Processes

TLDR: In this paper, the authors study the effects of an imperfect production process on the optimal production cycle time and derive the optimal cycle time for the case where the defective rate is a function of the set-up cost.

Abstract: In this paper, we study the effects of an imperfect production process on the optimal production cycle time. The system is assumed to deteriorate during the production process and produce some proportion of defective items. The optimal production cycle is derived, and is shown to be shorter than that of the classical Economic Manufacturing Quantity model. The analysis is extended to the case where the defective rate is a function of the set-up cost, for which the set-up cost level and the production cycle time are jointly optimized. Finally, we also consider the case where the deterioration process is dynamic in its nature, i.e., the proportion of defective items is not constant. Both linear, exponential, and multi-state deteriorating processes are studied. Numerical examples are provided to illustrate the derivation of the optimal production cycle time in these situations.