Determination of optimal part delivery dates in a stochastic assembly line

Abstract

We consider the problem of determining the optimal part delivery dates of a low volume, small lot assembly line which manufactures large and costly products. Parts are assembled at each stage to a subassembly. The arrival time of an assembly part from a vendor is assumed to be a normally distributed random variable. A dynamic programming algorithm is developed to minimize work-in-process inventory of parts and subassemblies. It is implemented on the single job problem. Its further extensions to the multi-job case and to incorporate the cost of setting delivery dates are also discussed.