Markovian Decision Models for Reject Allowance Problems

Morton Klein

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Supply Chain and Inventory Management Reliability and Maintenance Optimization Management and Optimization Techniques

Abstract

Most manufacturing processes produce some defective items. To compensate for this, the total quantity produced in attempting to satisfy an order is larger than the order size. The excess is called a reject allowance. In this paper it is shown how the Markovian decision framework can be used to determine the amount to produce when production is, or can be, divided so that the products can be inspected before the production run is ended.

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1996Managing Uncertainty in a Serial Production Line 1990Multiple lotsizing with random common-cause yield and rigid demand

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