Stochastic reliability measurement and design optimization of an inventory management system

Abstract

Inventory management systems and dynamic reliability measures and controls remain challenging at every stage, especially when time variances and operating conditions are considered. An inventory management system must maintain its adeptness over time while coping with the uncertainty of inventory flow. Unexpected delays during inventory movement can harm the reliability and robustness of the entire system. This paper introduces a method of quantifying the reliability of an inventory management system. Also, a novel, reliability-based robust design optimization model has been developed to optimally allocate and schedule time while considering uncertainty associated with inventory movement. The processes involved include purchasing, shipping, receiving, tracking, warehousing, storage, and turnover. A case study of a furniture company in Saudi Arabia is presented to demonstrate the efficacy of the model.