Journal of the Korean Operations Research and Management Science Society (한국경영과학회지)

The Korean Operations Research and Management Science Society (한국경영과학회)
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Integrated Inventory Allocation and Customer Order Admission Control in a Two-stage Supply Chain with Make-to-stock and Make-to-order Facilities

계획생산과 주문생산 시설들로 이루어진 두 단계 공급망에서 재고 할당과 고객주문 수용 통제의 통합적 관리

  • 김은갑 (이화여자대학교 경영대학)
  • Received : 2009.10.26
  • Accepted : 2010.02.05
  • Published : 2010.03.31
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Abstract

This paper considers a firm that operates make-to-stock and make-to-order facilities in successive stages. The make-to-stock facility produces components which are consumed by the external market demand as well as the internal make-to-order operation. The make-to-order facility processes customer orders with the option of acceptance or rejection. In this paper, we address the problem of coordinating how to allocate the capacity of the make-to-stock facility to internal and external demands and how to control incoming customer orders at the make-to-order facility so as to maximize the firm's profit subject to the system costs. To deal with this issue, we formulate the problem as a Markov decision process and characterize the structure of the optimal inventory allocation and customer order control. In a numerical experiment, we compare the performance of the optimal policy to the heuristic with static inventory allocation and admission control under different operating conditions of the system.

Keywords

References

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