Technical note-optimal structural results for assemble-to-order generalized M-Systems
INFORMS Inst.for Operations Res.and the Management Sciences
571 - 579
Item Usage Stats
MetadataShow full item record
We consider an assemble-to-order generalized M-system with multiple components and multiple products, batch ordering of components, random lead times, and lost sales. We model the system as an infinite-horizon Markov decision process and seek an optimal policy that specifies when a batch of components should be produced (i.e., inventory replenishment) and whether an arriving demand for each product should be satisfied (i.e., inventory allocation). We characterize optimal inventory replenishment and allocation policies under a mild condition on component batch sizes via a new type of policy: lattice-dependent base stock and lattice-dependent rationing. © 2014 INFORMS.
Markov decision processes
Markov Decision Processes