An unreliable production system with fluctuating production and demand rates

Esmail Mohebbi

International Journal of Applied Management Science, 2010, vol. 2, issue 1, 20-35

Abstract: This paper contains an analytical formulation for performance measurement of an unreliable production-storage operation where production and demand rates for a single item are subject to random fluctuations in the operating environment. These fluctuations are represented as transitions among the states of a continuous-time Markov chain and the demand process is characterised as a compound Poisson process. Assuming that the storage space is limited and the stockouts are lost, the proposed model yields exact expressions for a number of popular performance measures. The model is accompanied by some numerical results.

Keywords: inventories; production systems; limited capacity; random environments; Markov modulated processes; level crossings; fluctuating rates; production rates; demand rates; management science; random fluctuations; operating environments; continuous-time Markov chains; compound Poisson processes; storage space; stockouts. (search for similar items in EconPapers)
Date: 2010
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