Quality assurance inspection in supply chain production systems

A manufacturer needs to satisfy an order in its entirety, i.e., the demand is rigid. This scenario mandates the performance of quality assurance. After the production is completed, the manufacturer inspects the batch and discards any defective item. If the manufacturer finds out after the inspection, that the number of conforming units falls short of the outstanding demand, he needs to continue producing more items, till the demand is satisfied. Once enough conforming units are found to satisfy the entire demand, the process terminates. While most other studies focus on the production process, we concentrate on the inspection process. It turns out that the lot to be processed depends on the inspection procedures and the costs. We consider several yield patterns and show the different inspection policies for each yield.