Impact of dual uptime-reducing strategies, postponement, multi-delivery, and rework on a multiproduct fabrication-shipping problem

Abstract

This study examines the joint impact of outsourcing, overtime, multi-delivery, rework, and postponement on a multiproduct fabrication problem. A growing/clear trend in today’s customer requirements turned into rapid response and desired quality of multi-merchandises and multiple fixed-amount deliveries in equal-interval time. To satisfy customers’ expectations, current manufacturing firms must effectively design/plan their multiproduct production scheme with minimum fabrication-inventory-shipping expenses and under confined capacity. Motivated by assisting manufacturing firms in making the right production decision, this study develops a decision-support delayed-differentiation model considering multi-shipment, rework, and dual uptime-reducing strategies (namely, overtime and outsourcing). Our delayed-differentiation model comprises stage one, which makes all common/standard parts of multi-end-merchandises, and stage two, which produces multiple end merchandise. For cutting making times, the study proposes subcontracting a portion of the common/standard part’s lot size and adopting overtime-making end merchandise in stage two. The screening and reworking tasks identify and repair faulty items to ensure customers’ desired quality. The finished lots of end merchandise are divided into a few equal-amount shipments and distributed to customers in equal-interval time. We employ mathematical derivation and optimization methodology to derive the annual expected fabrication- inventory-shipping expense and the cost-minimized production-shipping policy. A numerical demonstration is presented to exhibit our research scheme’s applicability and exposes the studied problem’s critical managerial insights, which help the management make beneficial decisions.