End-of-life inventory management problem: results and insights

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buir.contributor.authorErkip, Nesim Kohen
buir.contributor.orcidErkip, Nesim Kohen|0000-0003-4122-6375
buir.contributor.orcidArarat, Çağın|0000-0002-6985-7665
dc.citation.epage24en_US
dc.citation.spage1en_US
dc.citation.volumeNumber243en_US
dc.contributor.authorOzyoruk, E.
dc.contributor.authorErkip, Nesim Kohen
dc.contributor.authorArarat, Çağın
dc.date.accessioned2023-02-21T07:37:20Z
dc.date.available2023-02-21T07:37:20Z
dc.date.issued2021-09-30
dc.departmentDepartment of Industrial Engineeringen_US
dc.description.abstractWe consider a manufacturer who manages the end-of-life phase and takes one of the three actions at each period: (1) place an order, (2) use existing inventory, (3) stop holding inventory and use an outside/alternative source. Two examples of this source are discounts for a new generation product and delegating operations. Demand is described by a non-homogeneous Poisson process, and the decision to stop holding inventory is described by a stopping time. After formulating this problem as an optimal stopping problem with additional decisions and presenting its dynamic programming algorithm, we use martingale theory to facilitate the calculation of the value function. Moreover, we show analytical results to understand the additional difficulties of the problem solved, as well as structural results on optimal stopping times. Furthermore, we devise an expandable taxonomy and categorize the models in the literature. Analytical insights from the models as well as an extensive numerical analysis show the value of our approach. The results indicate that the loss can be high in case the manufacturer does not exploit flexibility in placing orders or use an outside source. Several managerial insights are obtained through numerical analysis as well as structural results to facilitate decision-making during the end-of-life horizon. © 2021 Elsevier B.V.en_US
dc.description.provenanceSubmitted by Ferman Özavinç (ferman.ozavinc@bilkent.edu.tr) on 2023-02-21T07:37:20Z No. of bitstreams: 1 End-of-life inventory management problem results and insights.pdf: 910828 bytes, checksum: 4ef708c3555feee8c04c75707972753d (MD5)en
dc.description.provenanceMade available in DSpace on 2023-02-21T07:37:20Z (GMT). No. of bitstreams: 1 End-of-life inventory management problem results and insights.pdf: 910828 bytes, checksum: 4ef708c3555feee8c04c75707972753d (MD5) Previous issue date: 2021-09-30en
dc.identifier.doi10.1016/j.ijpe.2021.108313en_US
dc.identifier.issn0925-5273
dc.identifier.urihttp://hdl.handle.net/11693/111567
dc.language.isoEnglishen_US
dc.publisherElsevieren_US
dc.relation.isversionofhttps://dx.doi.org/10.1016/j.ijpe.2021.108313en_US
dc.source.titleInternational Journal of Production Economicsen_US
dc.subjectEnd-of-life inventory managementen_US
dc.subjectManagement of end-of-life problemen_US
dc.subjectManagement of end-of-life problemen_US
dc.subjectOptimal stopping with additional decisionsen_US
dc.titleEnd-of-life inventory management problem: results and insightsen_US
dc.typeArticleen_US

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