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Dynamic lot sizing for a warm/cold process: Heuristics and insights

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  • Toy, Ayhan Özgür
  • Berk, Emre

Abstract

We consider the dynamic lot sizing problem for a warm/cold process where the process can be kept warm at a unit variable cost for the next period if more than a prespecified quantity has been produced. Exploiting the optimal production plan structures, we develop nine rule-based forward solution heuristics. Proposed heuristics are modified counterparts of the heuristics developed previously for the classical dynamic lot sizing problem. In a numerical study, we investigate the performance of the proposed heuristics and identify operating environment characteristics where each particular heuristic is the best or among the best. Moreover, for a warm/cold process setting, our numerical studies indicate that, when used on a rolling horizon basis, a heuristic may also perform better costwise than a solution obtained using a dynamic programming approach.

Suggested Citation

  • Toy, Ayhan Özgür & Berk, Emre, 2013. "Dynamic lot sizing for a warm/cold process: Heuristics and insights," International Journal of Production Economics, Elsevier, vol. 145(1), pages 53-66.
    • Handle: RePEc:eee:proeco:v:145:y:2013:i:1:p:53-66
    DOI: 10.1016/j.ijpe.2012.09.006
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    1. de Sampaio, Raimundo J.B. & Wollmann, Rafael R.G. & Vieira, Paula F.G., 2017. "A flexible production planning for rolling-horizons," International Journal of Production Economics, Elsevier, vol. 190(C), pages 31-36.
    2. Yongjian Li & Xiaoqiang Cai & Lei Xu & Wenxia Yang, 2016. "Heuristic approach on dynamic lot-sizing model for durable products with end-of-use constraints," Annals of Operations Research, Springer, vol. 242(2), pages 265-283, July.

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