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Integrated Scheduling of Production and Two-Stage Delivery of Make-to-Order Products: Offline and Online Algorithms

Author

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  • Lixin Tang

    (Liaoning Engineering Laboratory of Operations Analytics and Optimization for Smart Industry, Institute of Industrial and Systems Engineering, Northeastern University, Shenyang 110819, China;)

  • Feng Li

    (School of Management, Huazhong University of Science & Technology, Wuhan 430074, China;)

  • Zhi-Long Chen

    (Robert H. Smith School of Business, University of Maryland, College Park, Maryland 20742)

Abstract

We study integrated production- and delivery-scheduling problems that arise in practical make-to-order settings in several industries. In these problems, make-to-order products are first processed in a plant and then delivered to customer sites through two stages of shipping: first, from the plant to a pool point (e.g., a port, a distribution, or a consolidation center) and, second, from the pool point to customer sites. The objective is to obtain a joint schedule of job processing at the plant and two-stage shipping of completed jobs to customer sites to optimize a performance measure that takes into account both delivery timeliness and total transportation costs. We consider two problems in which delivery timeliness is measured by total or maximum lead time of the jobs and study both offline and online versions of these problems. For the offline problems involving a single production line at the plant, we provide optimal dynamic programming algorithms. For the more general offline problems involving multiple production lines at the plant, we propose fast heuristics and analyze their worst-case and asymptotic performances. For the online problems, we propose online algorithms and analyze their competitive ratios. By comparing our offline heuristics with lower bounds using randomly generated test instances, it is shown that these heuristics are capable of generating near-optimal solutions quickly. Using real data from Baosteel’s Meishan plant, we also show that our corresponding offline heuristic generates significantly better solutions than Baosteel’s rule-based approach. In addition, our computational results on the performance of the online algorithms relative to the offline heuristics generate important methodological insights that can be used by practitioners in choosing a specific solution approach.

Suggested Citation

  • Lixin Tang & Feng Li & Zhi-Long Chen, 2019. "Integrated Scheduling of Production and Two-Stage Delivery of Make-to-Order Products: Offline and Online Algorithms," INFORMS Journal on Computing, INFORMS, vol. 31(3), pages 493-514, July.
  • Handle: RePEc:inm:orijoc:v:31:y:2019:i:3:p:493-514
    DOI: 10.1287/ijoc.2018.0842
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    References listed on IDEAS

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    1. Zhi-Long Chen & George L. Vairaktarakis, 2005. "Integrated Scheduling of Production and Distribution Operations," Management Science, INFORMS, vol. 51(4), pages 614-628, April.
    2. Liu, Ming & Chu, Chengbin & Xu, Yinfeng & Zheng, Feifeng, 2010. "An optimal online algorithm for single machine scheduling with bounded delivery times," European Journal of Operational Research, Elsevier, vol. 201(3), pages 693-700, March.
    3. Han, Bin & Zhang, Wenjun & Lu, Xiwen & Lin, Yingzi, 2015. "On-line supply chain scheduling for single-machine and parallel-machine configurations with a single customer: Minimizing the makespan and delivery cost," European Journal of Operational Research, Elsevier, vol. 244(3), pages 704-714.
    4. James Blocher & Dilip Chhajed, 2008. "Minimizing customer order lead-time in a two-stage assembly supply chain," Annals of Operations Research, Springer, vol. 161(1), pages 25-52, July.
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    8. Kathryn E. Stecke & Xuying Zhao, 2007. "Production and Transportation Integration for a Make-to-Order Manufacturing Company with a Commit-to-Delivery Business Mode," Manufacturing & Service Operations Management, INFORMS, vol. 9(2), pages 206-224, September.
    9. Valerie Tardif & Sridhar Tayur & James Reardon & Reid Stines & Pete Zimmerman, 2010. "OR Practice---Implementing Seasonal Logistics Tactics for Finished Goods Distribution at Deere & Company's C&CE Division," Operations Research, INFORMS, vol. 58(1), pages 1-15, February.
    10. Zhi-Long Chen, 2010. "Integrated Production and Outbound Distribution Scheduling: Review and Extensions," Operations Research, INFORMS, vol. 58(1), pages 130-148, February.
    11. Lixin Tang & Ying Meng & Zhi-Long Chen & Jiyin Liu, 2016. "Coil Batching to Improve Productivity and Energy Utilization in Steel Production," Manufacturing & Service Operations Management, INFORMS, vol. 18(2), pages 262-279, May.
    12. Ullrich, Christian A., 2013. "Integrated machine scheduling and vehicle routing with time windows," European Journal of Operational Research, Elsevier, vol. 227(1), pages 152-165.
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    Cited by:

    1. Li, Feng & Xu, Shifu & Xu, Zhou, 2023. "New exact and approximation algorithms for integrated production and transportation scheduling with committed delivery due dates and order acceptance," European Journal of Operational Research, Elsevier, vol. 306(1), pages 127-140.
    2. Wenjie Li & Jinjiang Yuan, 2021. "Single-machine online scheduling of jobs with non-delayed processing constraint," Journal of Combinatorial Optimization, Springer, vol. 41(4), pages 830-843, May.
    3. Wang, Julong & Liu, Zhixue & Li, Feng, 2024. "Integrated production and transportation scheduling problem under nonlinear cost structures," European Journal of Operational Research, Elsevier, vol. 313(3), pages 883-904.

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