DISCRETE MARKOV DECISION PROCESS – INVENTORY CONTROL IN A SERVICE FACILITY SYSTEM

Abstract

This article addresses the problem of inventory control in a service facility system in which ordering level is controlled by MDP. A discrete time service facility system is studied in which demand process follows a Bernoulli process. If a customer finds a free server, then he/ she enter the server immediately, otherwise join the waiting space with finite capacity say N. Inventory pool with maximum level S is maintained at service station to satisfy the customers. The (s, S) type policy is adopted to the inventory the lead times and service times are assumed to follow a geometric distribution. Average cost criteria based MDP is implemented to fix the optimal policy to be implemented. The results are illustrated numerically.