An integrated control policy for cost and waste minimization in unreliable hybrid manufacturing-remanufacturing systems

This paper addresses production‑planning and control in a mixed‑configuration hybrid manufacturing–remanufacturing system where one dedicated facility manufactures, while a second shared facility alternates–via setup operations–between manufacturing and remanufacturing modes. This configuration provides valuable flexibility and superior resource utilization but must still contend with capacity limits, stochastic demand and returns, machine failures, and setup‑induced downtime. The objective is to establish an integrated control policy that synchronizes manufacturing, remanufacturing, setup, and disposal through hedging‑point production rules and stock‑threshold triggers for setup and disposal. A multi‑objective simulation–optimization approach, combining response‑surface methodology with a desirability function, optimizes the policy parameters to minimize total cost and disposed returns. Sensitivity experiments confirm robustness under different managerial priorities; emphasizing remanufacturing reduces waste, whereas favoring manufacturing mitigates stockouts and holding costs. These guidelines enable decision‑makers to leverage the mixed configuration’s capabilities while maintaining a practical balance between cost efficiency and sustainability in failure‑prone environments.