Optimal Production Planning in Pull Flow Lines with Multiple Products
European Journal of Operational Research, Vol. 119, No. 3, pp. 582-604, December 1999
Posted: 8 Apr 2008
Date Written: 1999
The paper is concerned with the problem of optimal production planning in deterministic pull flow lines with multiple products. The objective is to specify the production policy that minimizes the total inventory and backlog costs overtime. Assuming constant product demands and non-decreasing unit holding costs along the flow, an algorithm which obtains the optimal production policy is developed. This algorithm works for the discounted-cost function as well. The HJB equation is used to verify the optimality of the policy, and the computational complexity of the algorithm is discussed. Some illustrative examples are also included.
Keywords: Production planning, HJB equation, Pull systems, Optimal Control
JEL Classification: M11, C61
Suggested Citation: Suggested Citation