Joint Optimization of Production Lot Sizing and Preventive Maintenance Threshold Based on Nonlinear Degradation

In a manufacturing system, lot sizing and maintenance are interdependent and interact with each other. Few studies jointly investigated production lot sizing and maintenance management considering system degradation. However, during the production process, the system and critical component performance will undergo inevitable degradation over time. For example, equipment wears out due to both its own internal causes and the external environment. To monitor the degradation process, interval inspection is usually performed to obtain information about the system degradation and nonlinear degradation is more general. Thus, based on the nonlinear degradation of the production system, this study developed a joint optimization model of production lot sizing and preventive maintenance (PM) thresholds with the goal of maximizing profit per unit of time. The maintenance decision follows the control limit principle, i.e., the choice between preventive maintenance (PM), corrective maintenance (CM), or neither (do nothing) is based on the magnitude of degradation. A simulation algorithm is proposed to obtain the optimal lot-sizing allocation and PM thresholds. The effectiveness of this joint optimization model algorithm is illustrated by numerical examples and the results show that the maximum profit per unit time can be obtained by reasonably formulating PM thresholds and production lot sizing.