The Collective Influence of Component Commonality, Adjustable-Rate, Postponement, and Rework on Multi-Item Manufacturing Decision

Singa Wang Chiu, Liang-Wei You, Tsu-Ming Yeh and Tiffany Chiu
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Singa Wang Chiu: Department of Business Administration, Chaoyang University of Technology, Taichung 413, Taiwan
Liang-Wei You: Department of Industrial Engineering and Management, Chaoyang University of Technology, Taichung 413, Taiwan
Tsu-Ming Yeh: Department of Industrial Engineering and Management, National Quemoy University, Kinmen 892, Taiwan
Tiffany Chiu: Anisfield School of Business, Ramapo College of New Jersey, Mahwah, NJ 07430, USA

Mathematics, 2020, vol. 8, issue 9, 1-18

Abstract: The present study explores the collective influence of component commonality, adjustable-rate, postponement, and rework on the multi-item manufacturing decision. In contemporary markets, customer demand trends point to fast-response, high-quality, and diversified merchandise. Hence, to meet customer expectations, modern manufacturers must plan their multiproduct fabrication schedule in the most efficient and cost-saving way, especially when product commonality exists in a series of end products. To respond to the above viewpoints, we propose a two-stage multiproduct manufacturing scheme, featuring an adjustable fabrication rate in stage one for all needed common parts, and manufacturing diversified finished goods in stage two. The rework processes are used in both stages to repair the inevitable, nonconforming items and ensure the desired product quality. We derive the cost-minimized rotation cycle decision through modeling, formulation, cost analysis, and differential calculus. Using a numerical illustration, we reveal the collective and individual influence of adjustable-rate, rework, and postponement strategies on diverse critical system performances (such as uptime of the common part and/or end products, utilization, individual cost factor, and total system cost). Our decision-support model offers in-depth managerial insights for manufacturing and operations planning in a wide variety of contemporary industries, such as household merchandise, clothing, and automotive.

Keywords: multi-item manufacturing; rotation cycle; product commonality; adjustable-rate; postponement; rework (search for similar items in EconPapers)
JEL-codes: C (search for similar items in EconPapers)
Date: 2020
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