A heuristic to control integrated multi-product multi-machine production-inventory systems with job shop routings and stochastic arrival, set-up and processing times

This paper investigates a multi-product multi-machine production-inventory system, characterized by job shop routings and stochastic demand interarrival times, set-up times and processing times. The inventory points and the production system are controlled integrally by a centralized decision maker. We present a heuristic that minimizes the relevant costs by making near-optimal production and inventory control decisions while target customer service levels are satisfied. The heuristic is tested in an extensive simulation study and the results are discussed.