Year: 1995
Type: article
Abstract: We develop heuristic and optimal methods for determining lot sizes when setup cost reductions occur over time due to emphasis on continuous improvement, learning effects and incremental process changes. Our heuristic methods are intuitively appealing, easy to implement, require little information about setup costs, and have low computational burden. Computational studies show that choosing the appropriate heuristic yields nearly optimal solutions. Recommendations for choosing the appropriate heuristic are also provided. The optimal method developed in this paper is also useful to managers for evaluating investments in hardware and/or worker training for setup reduction. Concepts and methods are illustrated with numerical examples. Managerial implications of using our policies are discussed.
Source: Journal of Operations Management
Authors: Ram Rachamadugu, Thomas J. Schriber
Institutions: University of Toledo, University of Michigan
Language: English
Subfield: Management Information Systems
Domain: Social Sciences
Open Access status: green
Funder: Strong
OpenAlex ID: W2053718408