Optimal investment in setup reduction in manufacturing systems with WIP inventories

T. J. Nye, E. M. Jewkes, D. M. Dilts

Research output: Contribution to journalArticlepeer-review

16 Scopus citations


A number of models have been proposed to predict optimal setup times, or optimal investment in setup reduction, in manufacturing cells. These have been based on the economic order quantity (EOQ) or economic production quantity (EPQ) model formulation, and have a common limitation in that they neglect work-in-process (WIP) inventories, which can be substantial in manufacturing systems. In this paper a new model is developed that predicts optimal production batch sizes and investments in setup reduction. This model is based on queuing theory, which permits it to estimate WIP levels as a function of the decisions variables, batch size and setup time. Optimal values for batch size and setup time are found analytically, even though the total cost model was shown to be strictly non-convex.

Original languageEnglish (US)
Pages (from-to)128-141
Number of pages14
JournalEuropean Journal of Operational Research
Issue number1
StatePublished - Nov 16 2001
Externally publishedYes


  • Inventory
  • Lot sizing
  • Manufacturing
  • Queuing
  • Setup time reduction

ASJC Scopus subject areas

  • Information Systems and Management
  • General Computer Science
  • Industrial and Manufacturing Engineering
  • Modeling and Simulation
  • Management Science and Operations Research


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