Abstract
Designing competitive manufacturing systems with high levels of productivity and quality at a reasonable cost is a complex task. Decision makers must face numerous decision variables which involve multiple and iterative analysis of the estimated cost, quality and productivity of each design alternative. This paper adresses this issue by providing a fast algorithm for solving the buffer sizing and inspection positioning problem of large production lines by combining heuristic and exact algorithms. We develop a multilevel hybrid search method combining a genetic algorithm and tabu search to identify promising locations for the inspection stations and an exact method that optimizes rapidly (in polynomial time) the buffers' sizes for each location. Our method gives valuable insights into the problem, and its solution time is a small fraction of that required by the exact method on production lines with 10-30 machines.