With the effect of increasing production rate, the probability of shifting the manufacturing process from “in-control” state to “out-of-control” increases with the passage of time. This happens due to the degradation of the mechanism which results in production of defective items. This study helps in examining the effect of changed production rate on the quality of goods produced. This research further examines the influence of manufacturing rate on “mean time to failure (MTTF)”. This increased production rate is not always environmental friendly due to the emission of contaminated gases after production process. The idea of making a specific investment initiation is incorporated in this paper to attain a sustainable environment development. Also, the information exchange is assumed in the supply chain system to achieve a better profitability. The mathematical model thus created and is validated with enough data, numerical experimentation, and graphical representation. The study concluded that higher degree of quality function reduces the MTTF of machine, also setup and environmental investment has highest impact on the total cost.

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Improving product quality is one of the most salient features in modern business to reach numerous numbers of customers. Thus, every company is working to improve customer satisfaction level by increasing product quality. But, to satisfy customer’s demand, companies may, sometimes increase the rate of production which affects the production system. This paper develops a supply chain system with one manufacturer and one retailer. In manufacturer’s end, an investment is considered to improve the system performance which is measured through a probabilistic value (“out-of-control” probability). A model is discussed in this paper regarding the dependency of production with the “out-of-control” probability with a negative exponential function of production rate. Besides that, the retailer also incurs an investment to reduce its setup cost. This paper develops a decentralized supply chain model and is analysed mathematically and validated with numerical and graphical analysis.