Control Strategy and its Parameters Optimization for Outsourcing Production Inventory System Under Uncertainty

Xiaofeng Zhu, Le Cao, Fei Liu, and Haixia Wang


Simulation optimization, Modeling, Cascade movement


Control strategy influences the performance of the production inventory system to a certain extent. A control strategy based on production point and production lot is proposed for the outsourcing production inventory system where the production capability of collaborative enterprises (PCOCE) and transportation time are uncertain. The probability distribution of PCOCE as well as probability distribution of transportation time is assumed to be empirical which can be obtained by the historical records. A Control parameters optimization model is built with the objective of minimizing the total production cost, and a simulation-based control parameters optimization algorithm is designed to solve this model. Finally, the control strategy and the control parameters optimization algorithm are illustrated by an example.

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