Sensitivity analysis for a make-to-order inventory–production system with limited order acceptance level

This paper considers a make-to-order inventory–production system in which customer orders are admitted only when the number of outstanding customer orders is below a value committed by the system. We deal with general distributions for the customer order inter-arrival, production, and replenishment lead time processes. Monotonicities of the optimal average cost with respect to these distribution parameters are established using sample path coupling arguments. When distributions are given as an exponential one, we implement a sensitivity analysis on the optimal inventory policy and show that it has monotonicities with respect to system costs using dynamic programming.