This study was prepared for a leading company, Miele GmbH, the global premium brand of domestic appliances and commercial machines in the field of laundry care, dishwashing and disinfection in Germany. The production line of Miele GmbH in Bielefeld, Germany was analyzed to develop a model that can be used for all the firms in the group. Dynamic programming models are widely used by companies to efficiently meet the demand for a variety of products. In a flow shop, each product has to be processed by a number of machines in synchronized lines. The production smoothing problems under the presence of setup and processing times vary among the products. The master production-inventory problem of Miele GmbH was divided into two sub-problems which were concerned with determining the batch sizes and production sequences of products, respectively. A dynamic programming procedure was developed to solve the batching problem for the current problem. A dynamic computational study for the first case was conducted so that the solution method is effective in meeting the goals of the firm and efficient in its computational requirements. Scientific problem –the firm has a problem of high logistics. Moreover, they want to decrease the cost of production in order to compete with their competitors. Their competitors start to make some of their production in low labour countries such as China. Miele is a special brand for upper level. However, they now have a more strict competition with new global players and one way to stay competitive in the market is to decrease the costs and find new market segments. The aim of the research –The dynamic programming algorithm is suggested to them to decrease the costs. The numbers of products are decreased to explain the algorithm. An example with calculations of this algorithm was explained in this study. The number of variables and constraints can be increased. After the logic of algorithm is understood, it can be applied many similar problems. The algorithm can be developed by using different software such as Java. Then, the variables and values of algorithm can be input for the algorithm and the results can be gotten in a short time. The object of the research – Inventory and Production mix projects. The methods of the research –Dynamic Programming.
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