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      Single item lot - sizing problem for a warm/cold process with immediate lost sales

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      Author
      Berk, E.
      Toy, A. Ö.
      Hazır, Ö.
      Date
      2008-06-16
      Journal Title
      European Journal of Operational Research
      Print ISSN
      0377-2217
      Publisher
      Elsevier
      Volume
      187
      Issue
      3
      Pages
      1251 - 1267
      Language
      English
      Type
      Article
      Metadata
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      Please cite this item using this persistent URL
      http://hdl.handle.net/11693/11597
      Abstract
      We consider the dynamic lot-sizing problem with finite capacity and possible lost sales for a process that could be kept warm at a unit variable cost for the next period t + 1 only if more than a threshold value Qt has been produced and would be cold, otherwise. Production with a cold process incurs a fixed positive setup cost, Kt and setup time, St, which may be positive. Setup costs and times for a warm process are negligible. We develop a dynamic programming formulation of the problem, establish theoretical results on the structure of the optimal production plan in the presence of zero and positive setup times with Wagner–Whitin-type cost structures. We also show that the solution to the dynamic lot-sizing problem with lost sales are generated from the full commitment production series improved via lost sales decisions in the presence of a warm/cold process. 2006 Elsevier B.V. All rights reserved.
      Published as
      http://dx.doi.org/10.1016/j.ejor.2006.06.070
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