JOINTLY OPTIMAL INVENTORY AND MAINTENANCE POLICIES.
STANFORD UNIV CALIF DEPT OF OPERATIONS RESEARCH
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A deterministic, continuous time, nonstationary inventory model is formulated to find the number of orders, the order quantities, and the times at which orders should be placed which minimize the total cost over a finite time horizon of meeting demand given by a requirements function. Conditions are given for the existence of an optimal policy with a regeneration point property. A deterministic, finite horizon inventory-maintenance system model is formulated to minimize total costs when the inventory demand is generated by choosing a sequence of equipment replacement intervals. Using the inventory results above, conditions are derived for the existence of an optimal policy such that orders are received only at times the equipment is replaced. Inventory and maintenance policies are determined which jointly minimize total avoidable cost when a single component of an equipment required to operate over a finite horizon fails stochastically with an increasing failure rate. The structure of the optimal replacement policies is characterized. Author
- Administration and Management
- Operations Research