Optimal development plan for new products: A control theoretic approach. (English) Zbl 0648.90048
Product quality affects a manufacturer’s profitability since better quality results in a bigger market share and greater revenue. Product quality can be improved by product development which costs money. Hence to maximize total profit the development plan must be selected optimally. This paper develops a dynamic model to optimally select the development rate and timing of release to maximize discounted expected profit.
MSC:
| 90B99 | Operations research and management science |
| 90B30 | Production models |
| 91B62 | Economic growth models |
Keywords:
optimal development plan; new products; product quality; quality improvement; development rate; dynamic model; timing of release; discounted expected profitReferences:
| [1] | Nguyen , D. G. D. N. P. Murthy Reliability Eng. |
| [2] | Zuckerman, ’A diffusion process for the optimal investment strategies of an R & D project’, J. Appl. Prob. 17 pp 646– (1980) · Zbl 0439.90045 |
| [3] | Kamien, Dynamic Optimization: The Calculus of Variations and Optimal Control in Economics & Management (1981) · Zbl 0455.49002 |
| [4] | Pontrayagin, The Mathematical Theory of Optimal Processes (1962) |
This reference list is based on information provided by the publisher or from digital mathematics libraries. Its items are heuristically matched to zbMATH identifiers and may contain data conversion errors. In some cases that data have been complemented/enhanced by data from zbMATH Open. This attempts to reflect the references listed in the original paper as accurately as possible without claiming completeness or a perfect matching.
