Mathematical method for calculating batch fragmentations and their impacts on product recall within a FIFO assignment policy

TL;DR

This paper introduces a mathematical approach to quantify batch fragmentation and its influence on product recalls under FIFO policies, enabling proactive recall strategies through a new fragmentation indicator and probabilistic analysis.

Contribution

It presents a novel mathematical method and a management indicator to assess batch fragmentation impact on recalls, integrating proactive recall planning into batch sizing decisions.

Findings

Fragmentation amplifies recall impact during crises.

New equation accurately predicts expected recall size.

Simulation confirms effectiveness of the proposed approach.

Abstract

This study explores the interactions between order sizes, batch sizes and potential product recalls within a FIFO assignment policy. Evidence is provided that the extent of a product recall is related to the fragmentation of the batches of input materials as it amplifies the impact of a crisis. A new management indicator is proposed in order to quantify the expected number of fragments composing a customer order FrBO. A probabilistic analysis reveals that for a given likelihood of crisis, the presence of different batches in a customer order will largely increase its risk. Accordingly, a new equation is proposed for calculating the expected recall size. Taking into account the fragmentation measure allows, for the first time, for the integration of a proactive product recall policy in the batch sizing decision process. A Monte Carlo simulation is performed to validate the effectiveness of this approach.