Component ordering strategies in assembly systems with uncertain capacity and random yield |
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| Institution: | 1. School of Management, Hainan University, Haikou 570228, China;2. School of Economic and Management, Southeast University, Nanjing 210000, China;3. Department of Management Sciences, Sun Yat-sen Business School, Sun Yat-sen University, Guangzhou 510275, China;4. Ningbo China Institute for Supply Chain Innovation, Ningbo, 315832, China;5. Department of Credit Management, School of Credit Management Guangdong University of Finance, Guangzhou 510521, China;1. Center of Materials Science and Optoelectronics Engineering, College of Materials Science and Opto-Electronic Technology, University of Chinese Academy of Sciences, Beijing 100049, China;2. Qiushi Honors College, Tianjin University, Tian jin 300350, China;3. McGill Metals Processing Centre, McGill University, Montreal, Quebec H3A 2B2 Canada;1. Industrial Engineering Department, Faculty of Engineering, Ferdowsi University of Mashhad, PO Box: 91775-111, Mashhad, Iran;2. Department of Mechanics, Institute of Construction and Architecture, Slovak Academy of Sciences, 84503 Bratislava, Slovakia;1. School of Science, Henan Institute of Technology, Xinxiang 453003, PR China;2. School of Mathematical Sciences, Dalian University of Technology, Dalian 116024, PR China;3. School of Ocean Engineering, Guangdong Ocean University, Zhanjiang 524088, PR China;4. School of Naval Architecture, State Key Laboratory of Structural Analysis for Industrial Equipment, Dalian University of Technology, Dalian 116024, PR China;5. Collaborative Innovation Center for Advanced Ship and Deep-Sea Exploration, Shanghai 200240, PR China;1. Institute of Petroleum Geology and Geophysics SB RAS, 3 Koptug ave., Novosibirsk 630090, Russia;2. Sobolev Institute of Mathematics SB RAS, 4 Koptug ave., Novosibirsk 630090, Russia;3. Novosibirsk State University, 2 Pirogova st., Novosibirsk 630090, Russia;4. Mathematical Center in Akademgorodok, 2 Pirogova st. & 4 Koptug ave., Novosibirsk 630090, Russia |
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| Abstract: | Sourcing components in a complex global supplier network may lead to a high degree of supply uncertainty. Events, such as unexpected production defects or insufficient supplier capacity, can cause unexpected shortages of required components and halt the assembly of final products. Accordingly, the assembly enterprises must effectively manage various supply uncertainties in their component ordering decisions to avoid such component shortfalls. These issues have guided this research to investigate the optimal ordering strategies of an assembler facing the following two types of supply uncertainty: the uncertain production capacity of a standard component (component 1) and the random production yield of a core component (component 2). The assembler makes the component ordering decisions before these supply uncertainties are realized. We characterize the optimal ordering decision and find that the assembler should order components 1 and 2 according to a fixed ratio, which only depends on the random yield of component 2 and the production cost of component 1, but not on the uncertain capacity of component 1. A case study is presented to further explore the intertwined effects of these two uncertainties in an assembly system. Finally, the model is extended to consider a secondary option of buying additional component 1 s after observing some or all of the supply uncertainties, and this secondary option endows the firm with different capabilities in counteracting the supply uncertainties. |
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