How Yield Process Misspecification Affects the Solution of Disassemble-to-order Problems

Stephanie Vogelgesang (), Ian M. Langella () and Karl Inderfurth ()
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Stephanie Vogelgesang: Faculty of Economics and Management, Otto-von-Guericke University Magdeburg
Ian M. Langella: John L. Grove College of Business, Shippensburg University
Karl Inderfurth: Faculty of Economics and Management, Otto-von-Guericke University Magdeburg

No 120029, FEMM Working Papers from Otto-von-Guericke University Magdeburg, Faculty of Economics and Management

Abstract: Random yields from production are often present in manufacturing systems and there are several ways that this can be modeled. In disassembly planning, the yield uncertainty in harvesting parts from cores can be modeled as either stochastically proportional or binomial, two of these alternatives. A statistical analysis of data from engine remanufacturing of a major car producer fails to provide conclusive evidence on which kind of yield randomness might prevail. In order to gain insight into the importance of this yield assumption, the impact of possible yield misspecification on the solution of the disassemble-to-order problem is investigated. Our results show that the penalty for misspecifying the yield method can be substantial, and provide insight on when the penalty would likely be problematic. The results also indicate that in the absence of conclusive information on which alternative should be chosen, presuming binomial yields generally leads to lower cost penalties and therefore preferable results.

Keywords: Remanufacturing; Disassembly; Random yields; Disassemble-to-order problem; Binomial yields; Stochastically proportional yields (search for similar items in EconPapers)
Pages: 34 pages
Date: 2012-11
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Persistent link: https://EconPapers.repec.org/RePEc:mag:wpaper:120029

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