Optimal allocation of inspection effort in a serial multi-stage production system

An economic design of inspection effort allocation is considered for a serial multistage production system in which a product consists of many identical components, only a limited number of automatic inspection machines are available, and the rate of production is constrained by the rate of inspection. A cost model is constructed and a method of finding optimal locations of inspection machines and inspection level—proportion of components inspected—is presented. For situations where the numbers of stages and inspection machines are large, a heuristic allocation algorithm using dynamic programming is proposed. A numerical example describing the solution procedure and a simulation study, evaluating performance of the proposed algorithm, are given.