Batch scheduling in a multistage, multiproduct manufacturing system – an application

This paper reports the results of our collaborative work with Changde Telecommunication Equipment Company (CTEC) which produces digital transfer control systems for telephone networks. The manufacturing operations consist of two principle stages of module production and system assembly. Critical system components are produced in the module production stage where high inventories were a major managerial concern. We studied CTEC’s module production system and proposed three modifications to reduce inventories and improve system performance. The current system and the proposed modifications were simulated and compared in terms of various operational and financial criteria. The simulation was repeated in its entirety under a high level of demand due to CTEC’s anticipation of increased market share. The results, endorsed by CTEC’s management, demonstrate that significant operational and financial benefits can indeed be realized using the proposed modifications. This study provides motivation for the development of concepts and methodologies that will be useful in future theoretical and practical research.