For an unreliable production system, process monitoring, quality control, and maintenance are essential activities for assuring the proper operation of the production system and for managing the quality of the system’s outputs. Although these activities are interrelated, they are seldom studied simultaneously. This paper interrelates and synthesizes the economic design of these activities and the management of an unreliable production system described in terms of an M/G/1 queue. A mathematical model is developed to determine the optimal policies of these activities when both the quality and quantity issues in the system are considered. Then, managerial insights are provided regarding the role and interrelationship of these activities. Finally, hypothetical data are used to illustrate the impact of these activities on the operating characteristics of the production system.
ASJC Scopus subject areas
- Strategy and Management
- Management Science and Operations Research
- Industrial and Manufacturing Engineering