Application of optimal control theory to adjust the production rate of deteriorating inventory system (Case study: Dineh Iran Co.)

摘要

In this paper, optimal control of production inventory system with deteriorating items is considered. It is assumed that deterioration rate follows the Weibull distribution. It is, also, assumed that the demand of the manufacturing product is time dependent. For building our model we will assume that the firm has set an inventory goal level and production goal rate. We will study a periodic policy review and Lagrangian technique is used. The objective is to determine the optimal production rate. We adjust the optimal production rate to minimum total (production and inventory) costs. The assumption of a time variant demand is more real in the world and makes the result of this research more practical for Industries. This model has been applied in Dineh Iran Co., The Group of Pharmaceutical, Hygienic & Food Industries.