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On the service models for dynamic scheduling of multi-class base-stock controlled systems

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2005
Kat, Bora
This study is on the service models for dynamic scheduling of multi-class make-to-stock systems. An exponential single-server facility processes different types of items one by one and demand arrivals for different item types occur according to independent Poisson processes. Inventories of the items are managed by base-stock policies and backordering is allowed. The objective is to minimize base-stock investments or average inventory holding costs subject to a constraint on the aggregate fill rate, which is a weighted average of the fill rates of the item types. The base-stock controlled policy that maximizes aggregate fill rate is numerically investigated, for both symmetric and asymmetric systems, and is shown to be optimal for minimizing base-stock investments under an aggregate fill rate constraint. Alternative policies are generated by heuristics in order to approximate the policy that maximizes aggregate fill rate and performances of these policies are compared to those of two well-known Longest Queue and First Come First Served policies. Also, optimal policy for the service model to minimize average inventory holding cost subject to an aggregate fill rate constraint is investigated without restricting the attention to only base-stock controlled dynamic scheduling policies. Based on the equivalence relations between this service model and the corresponding cost model, it is observed that the base-stock controlled policy that maximizes aggregate fill rate is almost the same as the solution to the service model and cost model under consideration, especially when backorder penalties are large in the cost model as compared to cost parameters for inventory holding or equivalently when the target fill rate is large in the service model.