Showing papers in "Iie Transactions in 1999"

A review of integrated analysis of production–distribution systems

Abstract: This paper reviews recent work on integrated analysis of production-distribution systems, and identifies important areas where further research is needed. By integrated analysis we understand analysis performed on models that integrate decisions of different production and distribution functions for a simultaneous optimization. We review work that explicitly considers the transportation system in the analysis, since we are interested in the following questions: (i) how have logistics aspects been included in the integrated analysis? and (ii) what competitive advantages, if any, have been obtained from the integration of the distribution function to other production functions within a company and among different companies? In our review we also mention whether the work has been done at the strategic level, i.e., if it concerns the design of the distribution system, or at the tactical level, i.e., if it concerns optimization problems for which the characteristics of the distribution system are provided.

A literature survey on planning and control of warehousing systems

Abstract: We present a literature survey on methods and techniques for the planning and control of warehousing systems. Planning refers to management decisions that affect the intermediate term (one or multiple months), such as inventory management and storage location assignment. Control refers to the operational decisions that affect the short term (hours, day), such as routing, sequencing, scheduling and order-batching. Prior to the literature survey, we give an introduction into warehousing systems and a classification of warehouse management problems.

On combinatorial auction and Lagrangean relaxation for distributed resource scheduling

Abstract: Most existing methods for scheduling are based on centralized or hierarchical decision making using monolithic models. In ihis study, we investigate a new method based on a distributed and locally autonomous decision structure using the notion of combinatorial auction. In combinatorial auction the bidders demand a combination of dependent objects with a single bid. We show that not only can we use this auction mechanism to handle complex resource scheduling problems, but there exist strong links between combinatorial auction and Lagrangean-based decomposition. Exploring some of these properties, we characterize combinatorial auction using auction protocols and payment functions. This study is a first step toward developing a distributed scheduling framework that maintains system-wide performance while accommodating local preferences and objectives. We provide some insights to this framework by demonstrating four different versions of the auction mechanism using job shop scheduling problems.

Forming teams: an analytical approach

Abstract: The selection of multi-functional teams is a key issue in problem solving. Currently there are no papers in the literature that discuss analytical approaches to forming teams. Furthermore, no comprehensive model exists to prioritize team membership based on customer requirements or product characteristics. To deal with the underlying complexities of the team selection process, a methodology for team formation is developed. The methodology is based on the Analytical Hierarchy Process (AHP) approach and the Quality Function Deployment (QFD) method. A QFD planning matrix is used to organize the factors considered in the team selection. The importance measure for each team member is determined with the AHP approach. A mathematical programming model is developed to determine the composition of a team. The methodology developed in this paper is tested by the selection of teams in concurrent engineering. A detailed discussion of the model implementation and hov/ to reduce the number of comparisons in the AHP pro...

A primal decomposition method for the integrated design of multi-period production–distribution systems

Abstract: We study the integrated design of strategic supply chain networks and the determination of tactical production–distribution allocations in the case of customer demands with seasonal variations. Given a set of potential suppliers, potential manufacturing facilities and distribution centers with multiple possible configurations, and customers with seasonal demands, the goal is to determine the configuration of the production–distribution system with the lowest sum of supply, production, transportation, inventory, and facility costs such that seasonal customer demands are met. We develop a mixed integer programming formulation and an integrated design methodology based on primal (Benders) decomposition. For a case study in the packaging industry, specialized acceleration techniques reduced the running times by a factor of 480. The company projects savings of 2% or $8.3 million by using the integrated rather than the optimal hierarchical configuration.

An equilibrium analysis of linear, proportional and uniform allocation of scarce capacity

Abstract: In many industries a supplier's total demand from the retailers she supplies frequently exceeds her capacity. In these situations, the supplier must allocate her capacity in some manner. We consider three allocation schemes: proportional, linear and uniform. With either proportional or linear allocation a retailer receives less than his order whenever capacity binds. Hence, each retailer has the incentive to order strategically; retailers order more than they desire in an attempt to ensure that their ultimate allocation is close to what they truly want. Of course, they will receive too much if capacity does not bind. In the capacity allocation game, each retailer must form expectations on how much other retailers actually desire (which is uncertain) and how much each will actually order, knowing that all retailers face the same problem. We present methods to find Nash equilibria in the capacity allocation game with either proportional or linear allocation. We find that behavior in this game with either of those allocation rules can be quite unpredictable, primarily because there may not exist a Nash equilibrium. In those situations any order above one's desired quantity can be justified, no matter how large. Consequently, a retailer with a high need may be allocated less than a retailer with a low need; clearly an ex post inefficient allocation. However, we demonstrate that with uniform allocation there always exists a unique Nash equilibrium. Further, in that equilibrium the retailers order their desired amounts, i.e., there is no order inflation. We compare supply chain profits across the three allocation schemes.

The GLRT for statistical process control of autocorrelated processes

Abstract: This paper presents an on-line Statistical Process Control (SPC) technique, based on a Generalized Likelihood Ratio Test (GLRT), for detecting and estimating mean shifts in autocorrelated processes that follow a normally distributed Autoregressive Integrated Moving Average (ARIMA) model. The GLRT is applied to the uncorrelated residuals of the appropriate time-series model. The performance of the GLRT is compared to two other commonly applied residual-based tests ‐ a Shewhart individuals chart and a CUSUM test. A wide range of ARIMA models are considered, with the conclusion that the best residual-based test to use depends on the particular ARIMA model used to describe the autocorrelation. For many models, the GLRT performance is far superior to either a CUSUM or Shewhart test, while for others the diAerence is negligible or the CUSUM test performs slightly better. Simple, intuitive guidelines are provided for determining which residual-based test to use. Additional advantages of the GLRT are that it directly provides estimates of the magnitude and time of occurrence of the mean shift, and can be used to distinguish diAerent types of faults, e.g., a sustained mean shift versus a temporary spike.

An integrated group decision-making approach to quality function deployment

Abstract: Quality Function Deployment (QFD) is a multi-disciplinary team process in which team member preferences are often in conflict with respect to varied individual objectives. Successful applications of QFD, thus, rely on: (1) effective communication among team members to reach a consensus; (2) assigning importance levels that reflect each individual member's preferences; and (3) mutual interaction of these two factors. No previous paper in the QFD literature has attempted to aggregate team members' opinions in the case where each individual has his or her own criteria. In this study, we consider both agreed criteria, if any, and individual criteria, simultaneously; whereas AHP, MAUT, and others are based only on an agreed set of criteria. Specifically, we modify the nominal group technique to obtain customer requirements, and integrate agreed and individual criteria methods to assign customer's importance levels in general situations where some members in a team have an agreed criteria set while others prefer individual criteria sets. By using voting and linear programming techniques, the proposed approaches consolidate individual preferences into a group consensus in situations starting with or without (partial) agreed criteria sets. This integrated group decision-making system minimizes inconsistency over group and individual preferences and provides preference ordering for alternatives through iterative communication and the resolution of any inconsistencies that exist between the group and individuals, and amongst the individuals themselves.

The components of complexity in engineering design

Abstract: The axiomatic design approach has contributed to the advancement of design practice by creating good design evaluation criteria based on design axioms. Complexity measure is important in design evaluation in order to simplify the engineering design. In this paper, we use Boltzmann entropy as the complexity measure and derive mathematical relationships between design complexity and various components in engineering design in the context of the axiomatic design approach. Three components of the design complexity are identified, they are variability, vulnerability and correlation, in which the vulnerability is related to the size of the design problem, the interdependency of design parameters and the sensitivity of functional requirements of the design towards the change in design parameters.

Integrated production maintenance and quality model for imperfect processes

Abstract: In this paper, we develop an integrated model for the joint optimization of the economic production quantity, the economic design of x¯-control chart, and the optimal maintenance level. This is done for a deteriorating process where the in-control period follows a general probability distribution with increasing hazard rate. In the proposed model, Preventive Maintenance (PM) activities reduce the shift rate to the out-of-control state proportional to the PM level. Compared to the case with no PM, the extra cost of maintenance results in lower quality control cost which may lead to lower overall expected cost. These issues are illustrated using an example of a Weibull shock model with an increasing hazard rate.

A comparison of control charting procedures for monitoring process dispersion

Abstract: We consider several control charts for monitoring normal processes for changes in dispersion We present comparisons of the average run length performances of these charts We demonstrate that a CUSUM chart based on the likelihood ratio test for the change point problem for normal variances has an ARL performance that is superior to other procedures Graphs are given to aid in designing this control chart

Designing cellular manufacturing systems with dynamic part populations

Abstract: The effectiveness of a cellular manufacturing system is sensitive to fluctuations in the demand for products and the product mix. This paper presents a new formulation of the part family/machine cell formation problem that addresses the dynamic nature of the production environment by considering a multi-period forecast of product mix and demand during the formation of part families and machine cells. The goal of the multi-period formulation is to obtain a cellular design that continues to perform well with respect to the design objectives as the part population changes with time.

An analytical comparison of long and short term contracts

Abstract: In this paper, we describe an analytical model to determine contracting policies for a firm that purchases components from external suppliers. The model evaluates the tradeoff between the flexibility offered by short term contracts and the fixed investments, improvement opportunities and price certainty associated with long term contracts. We show that long term contracts may not always be optimal, and discuss conditions under which short term contracts may be justified. During a recent survey of supply managers, we observed that managers often tend to participate in short term contracts, even though they claim to seek long term relationships with suppliers. Sensitivity analysis of our model provides some explanation for this observed inconsistency. We also discuss managerial implications of the analysis.

Optimal preventive maintenance in a production inventory system

Abstract: We consider a production inventory system that produces a single product type, and inventory is maintained according to an (S, s) policy. Exogenous demand for the product arrives according to a random process. Unsatisfied demands are not back ordered. Such a make-to-stock production inventory policy is found very commonly in discrete part manufacturing industry, e.g., automotive spare parts manufacturing. It is assumed that the demand arrival process is Poisson. Also, the unit production time, the time between failures, and the repair and maintenance times are assumed to have general probability distributions. We conjecture that, for any such system, the down time due to failures can be reduced through preventive maintenance resulting in possible increase in the system performance. We develop a mathematical model of the system, and derive expressions for several performance measures. One such measure (cost benefit) is used as the basis for optimal determination of the maintenance parameters. The model application is explained via detailed study of 21 variants of a numerical example problem. The optimal maintenance policies (obtained using a numerical search technique) vary widely depending on the problem parameters. Plots of the cost benefit versus the system characteristic parameters (such as, demand arrival rate, failure rate, production rate, etc.) reveal the parameter sensitivities. The results show that the actual values of the failure and maintenance costs, and their ratio are significant in determining the sensitivities of the system parameters.

The capacitated lot sizing problem with setup carry-over

Abstract: Although there is a significant amount of literature on the capacitated lot sizing problem, there has been insufficient consideration of planning problems in which it is possible for a lot size, or production run, to continue over consecutive time periods without incurring multiple setups. While there are papers that consider this feature, they typically restrict production to at most one product in each period. We present a set of mixed integer linear programs for the capacitated lot sizing problem that incorporate setup carry-over without restricting the number of products produced in each time period. Efficient reformulations are developed for finding optimal solutions, and a Lagrangian decomposition heuristic is provided that quickly generates near-optimal solutions. The computational results demonstrate that incorporating setup carry-over has a significant effect on both cost and lot sizes.

Long run and transient analysis of a double EWMA feedback controller

Abstract: The “predictor-corrector” feedback controller is a popular adjustment scheme proposed for the quality control of certain semiconductor manufacturing process steps. This controller is based on a double Exponentially-Weighted Moving Average (EWMA) scheme; thus the performance of the closed-loop system depends on the two weight parameters of the EWM A equations. In this paper, the conditions the weights must satisfy to ensure closed-loop stability are discussed. The optimal determination of the controller weights depends on a trade-off between long-run process variance and transient bias performance. It is shown that small weights, although they can guarantee stability, may result in severe, long transients, an important concern if fabrication is in small batches. An optimization model for finding the controller weights is given and numerically solved. An extension of this type of controllers to the multiple controllable factor case is described. The performance of the controller is illustrated with...

Optimal routing in an automated storage/retrieval system with dedicated storage

Abstract: We address the sequencing of requests in an automated storage/retrieval system with dedicated storage. We consider the block sequencing approach, where a set of storage and retrieval requests is given beforehand and no new requests come in during operation. The objective for this static problem is to find a route of minimal total travel time in which all storage and retrieval requests may be performed. The problem of sequencing a list of retrievals is equivalent to the Traveling Salesman Problem (TSP), and thus NP-hard in general. We show that the special case of sequencing under the dedicated storage policy can be solved in polynomial time. The results apply to systems with arbitrary positions of the input and output stations. This generalizes the models in the literature, where only combined input/output stations are considered. Furthermore we identify a single command area in the rack. At the end we evaluate the model against heuristic procedures.

Integrating early sales with production decisions: analysis and insights

Abstract: Faster product development and increased competition in retail industries is resulting in shorter and shorter product life-cycles. This phenomenon is making it more difficult for a firm to accurately estimate random demand of such products and to plan their one-time order quantity accordingly. In this paper, we develop a model to assess the multiple effects of coordinated – i.e., joint – stocking and prior-sale discount decisions: (i) on the reduction of demand uncertainty; (ii) on maximization of the expected profit; and (iii) on the probability of achieving or exceeding it. We develop the joint optimal decisions that maximize the expected profit and discuss a procedure for computing the probability that the realized value of the (random) profit will exceed its maximum expected value. We present qualitative results on the varying effects of joint decisions on increasing the expected profit and the probability of achieving or exceeding it. We also describe a detailed numerical study examining the effects of varying parameter values on the percentage increase in expected profit with joint decision making. The paper concludes with extensions of the model that can deal with more general situations.

Product modeling within the framework of the World Wide Web

Abstract: This paper presents an approach to the development of an open collaborative design environment in the Computer Aided Design (CAD) setting of a networked enterprise. Demand for high quality and variety of low to medium quality of products or 'mass customization’ has led to the concept of 'virtual organizations’. The de-centralized design teams of such an organization require a framework to manage the CAD product information. By integrating the emerging standard for 3D geometry on the World Wide Web with conventional CAD packages, we describe a framework for the development of a product model with various levels of abstractions. The syntactic content of the product model, accessible through any Internet interface such as Netscape Navigator associates itself with a centralized database for embedding technological information at the face and feature levels. The semantic and syntactic content of the product model can then be accessed and manipulated through the single Internet interface. The system is deployed on a test-bed utilizing both a UNIX box and a machine operating under the Windows NT system, to demonstrate it's open architecture and interoperability.

Fleet management models and algorithms for an oil-tanker routing and scheduling problem

Abstract: This paper explores models and algorithms for routing and scheduling ships in a maritime transportation system. The principal thrust of this research effort is focused on the Kuwait Petroleum Corporation (KPC) Problem. This problem is of great economic significance to the State of Kuwait, whose economy has been traditionally dominated to a large extent by the oil sector, and any enhancement in the existing ad-hoc scheduling procedure has the potential for significant savings. A mixed-integer programming model for the KPC problem is constructed in this paper. The resulting mathematical formulation is rather complex to solve due to the integrality conditions and the overwhelming size of the problem for a typical demand contract scenario. Consequently, an alternate aggregate model that retains the principal features of the KPC problem is formulated. The latter model is computationally far more tractable than the initial model, and a specialized rolling horizon heuristic is developed to solve it. The proposed heuristic procedure enables us to derive solutions for practical sized problems that could not be handled by directly solving even the aggregate model. The initial formulation is solved using CPLEX-4.0-MIP capabilities for a number of relatively small-sized test cases, whereas for larger problem instances, the aggregate formulation is solved using CPLEX-4.0-MIP in concert with the developed rolling horizon heuristic, and related results are reported. An ad-hoc routing procedure that is intended to simulate the current KPC scheduling practice is also described and implemented. The results demonstrate that the proposed approach substantially improves upon the results obtained using the current scheduling practice at KPC.

Managing design of assembly sequences for product lines that delay product differentiation

Abstract: The integration of product design and operations could potentially enhance the ability of manufacturers to provide large variety in the product line while keeping their operations competitive. At the plant level, an improved assembly sequence can lead to superior operational response to customer demands. While this has been intuitively accepted, there is a scarcity of models that can adequately reflect the operational benefits of a costlier yet better design. In this paper, we present integrated models applicable at a plant level that can provide quantification of certain operational benefits. Further, through a computational study, we also provide qualitative insights on several issues such as the effect of : (i) features in the product line; (ii) variance of demand for the different features on the optimal assembly design; (iii) set-up times; and (iv) life cycle of the product line.

A capacitated vehicle routing problem for just-in-time delivery

Abstract: This paper focuses on the formulation and solution of the problem of planning vehicle routes for material delivery within the premises of a plant working under a just-in-time production system. The unique characteristic of this problem is that the quantity to be delivered at each of the demand nodes is a function of the route taken by the vehicle assigned to serve that node. The problem is modeled by adding a non-linear capacity constraint to the standard vehicle routing model, such that vehicle idle times and inventories at the customer locations are minimized. A heuristic solution procedure is outlined, and the formulation of a lower-bound relaxation is suggested. The performance of the heuristic solution procedure is evaluated in comparison to the lower-bound relaxation, and the heuristic procedure is shown to provide generally good results.

Lot streaming and scheduling multiple products in two-machine no-wait flowshops

Abstract: We consider the problem of minimizing makespan in two-machine no-wait flowshops with multiple products requiring lot streaming. A “product” (or lot) consists of many identical items. Lot streaming (lot sizing) is the process of creating sublots (or transfer batches) to move the completed portion of a production sublot to downstream machines so that operations can be overlapped. The number of sublots for each product is fixed. When the flowshop produces only a single product, we obtain optimal continuous-sized sublots. It is shown that these sublot sizes are also optimal for the problem of simultaneous lot streaming and scheduling of multiple products. The optimal scheduling of products can be accomplished by application of the algorithm due to Gilmore and Gomory [1]. Then, we devise an efficient heuristic for the problem of simultaneous lot streaming (finding optimal integer-sized sublots) and scheduling of multiple products. Computational results indicate that this heuristic can consistently deliver close-to-optimal solutions for the problem. A comparison of this heuristic is also made with a heuristic that first divides items belonging to each product into nearly equal-sized sublots and then constructs a schedule for such sublots. Finally, we extend our solution procedures to a traditional and more general lot streaming model, where the number of sublots for each product is a decision variable.

Review and classification of reliability measures for multistate and continuum models

Abstract: In this paper we examine a variety of customer-centered reliability measures, generalized to multistate and continuum contexts. A classification scheme is proposed for these measures, and a new measure based on customer-usage patterns is defined. In each case, reliability measures are defined such that they are equally valid for binary, multistate, continuum, and mixed systems. Techniques which facilitate the use of continuum models are discussed, and time-dynamic, infinite-time, and partial-information modeling considerations are also addressed.

Operations planning in a supply chain system with fixed-interval deliveries of finished goods to multiple customers

Abstract: Raw material ordering policy and the manufacturing batch size for fixed-interval deliveries of finished goods to multiple customers play a significant role in economically managing the supply chain logistics. This paper develops an ordering policy for raw materials and determines an economic batch size for a product at a manufacturing center which supplies finished products to multiple customers, with a fixed-quantity at a fixed time-interval to each of the customers. In this model, an optimal multi-ordering policy for procurement of raw materials for a single manufacturing system is developed to minimize the total cost incurred due to raw materials and finished goods inventories. The carried over inventory of finished goods from the previous cycle is used as initial finished goods inventory, resulting in shifting the production schedule ahead for the next cycle. A closed-form solution to the problem is obtained for the minimal total cost. The algorithm is demonstrated for multiple customer systems.

Single-machine scheduling with sequence dependent setup to minimize total weighted squared tardiness

Abstract: This paper addresses the NP-hard problem of scheduling N independent jobs on a single machine with release dates, due dates, sequence dependent setup times, and no preemption where the objective is to minimize the weighted sum of squared tardiness. A Lagrangian relaxation based approach is developed for single-machine scheduling with sequence dependent setup times that is based on a list scheduling concept in conjunction with Lagrangian relaxation. Sequence dependent setup times are formulated as capacity constraints, and then are relaxed using Lagrangian multipliers. The primal problem is decomposed into job-level subproblems which are solved optimally and an approximate dual problem is then solved using a sub-gradient technique. The result of the relaxation is a list of jobs sequenced by beginning times that is then improved via a three-way swap. Experimental results are compared with EDD (Earliest Due Date) and ATCS (Apparent Tardiness Cost with Setups) dispatching rules, a four-way swap local search, tabu search, and simulated annealing. The adopted approach results in superior solution quality with respect to EED, ATCS, four-way swap, and tabu search results. It has comparable solution quality to the simulated annealing results, but is substantially more computationally efficient. Overall, the approach is capable of dealing with realistically sized single machine scheduling problems with release dates, due dates, and sequence dependent setup times.

Integrated design of run-to-run PID controller and SPC monitoring for process disturbance rejection

Abstract: An integrated design methodology has been developed for a run-to-run PID controller and SPC monitoring for the purpose of process disturbance rejection. In the paper, the process disturbance is assumed to be an ARMA (1,1) process. A detailed procedure is developed to design a PID controller which minimizes process variability. The performance of the PID controller is also discussed. A joint monitoring of input and output, using Bonferroni's approach, is then designed for the controlled process. The ARL performance is studied. One major contribution of the paper is to develop a complete procedure and design plots, which serve as tools to conduct all the aforementioned tasks. An example is provided to illustrate the integrated design approach.

Modeling and analysis of dynamic robust design experiments

Abstract: This paper investigates the modeling issue of the dynamic robust design problem. Taguchi (1986) proposes a loss model approach which models the loss measures as functions of the control factor effects. Miller and Wu (1996) propose a response function model approach which models the loss measures as functions of the effects of both the control and noise factors. In this paper we propose a response model approach which directly models the response as a function of the effects of the control, noise, and signal factors. It is found that the effect estimates of the intercept and slope functions from the three approaches are identical. The significant effects identified from the loss model and the response function model approaches may be spurious. The loss model approach may lead to non-optimal solutions and information loss. The three modeling approaches are compared in a real example.

A branch-and-bound algorithm for permutation flow shops with sequence-dependent setup times

Abstract: This paper presents a branch-and-bound enumeration scheme for the makespan minimization of the permutation flow shop scheduling problem with sequence-dependent setup times. The algorithm includes the implementation of both lower and upper bounding procedures, a dominance elimination criterion, and special features such as a partial enumeration strategy. A computational evaluation of the overall scheme demonstrates the effectiveness of each component. Test results are provided for a wide range of problem instances.

The power of coordinated decisions for short-life-cycle products in a manufacturing and distribution supply chain

Abstract: This paper explores ways of conceptualizing and studying the power of coordination and strategic alliances within a manufacturing and distribution supply chain consisting of one manufacturer and one distributor. The supply chain operates to meet price-sensitive random demand of a product with a short product life cycle. We derive closed-form multi-attribute measures of performance for the supply chain in the presence of and in the absence of coordination of pricing and production/ordering decisions. The optimal coordinated pricing and production/ordering policies, as well as each party's optimal policies in the absence of coordination, are developed. Our results yield insights into basic managerial issues for this type of manufacturing and distribution supply chains.