Single Cycle Continuous Review Policies for Arborescent Production/Inventory Systems.
SCHWARZ (LEROY B) ROCHESTER N Y
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In this paper the author examines optimal and near-optimal continuous review policies for a deterministic arborescent inventory system known and constant outside demand must be met without backlogging or lost sales at minimum average system cost per unit time. Costs are of two types a fixed order cost at each stage and proportional holding costs on each stages echelon inventory. The author describes some characteristics of optimal policies and, under farily mild conditions e.g., zero initial inventory, prove that the optimal stationary policy is a single-cycle policy. An efficient branch-and-bound algorithm for determining optimal single-cycle policies for arborescent systems is presented. The near-optimality of system myopic single-cycle policies is also examined.
- Administration and Management
- Manufacturing and Industrial Engineering and Control of Production Systems