Investigating Production Yield Effect on Inventory Control through a Hybrid Simulation Approach

Production Planning and Control (PPC) plays a key role in stabilizing and improving manufacturing processes under external and internal uncertainties by providing transparency in the whole system. This study focuses on PPC with internal uncertainties such as losses of work-in-process products during a contact lens manufacturing process. Although such losses are expected, the yield rates are uncertain and vary at different production stages. A hybrid agent-based simulation (ABS) and discrete-event simulation (DES) approach was utilized to resemble the underlying dynamics of the manufacturing system with uncertain yield rates. The results of the simulation experiments demonstrated that a simple average yield approach for production planning would cause potential backlogs and extra holding costs for the excess inventory. The proposed hybrid simulation could be used to support the decision-making process on a weekly basis to help a production planning team make a schedule that would improve efficiency and customer satisfaction.