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Efficient, Effective Lot Sizing for Multistage Production Systems

Author

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  • Robin O. Roundy

    (Cornell University, Ithaca, New York)

Abstract

We consider a multistage, multiproduct production/inventory system in discrete time. When an order is placed for a component it is instantly delivered, and the required amounts of the components consumed in producing the given component are simultaneously withdrawn from their respective inventories. External demand occurs for a single component. We assume that the external demand for the component is nonconstant, deterministic, and must be met without backlogging. We propose two new cluster-based heuristics for this problem. We will show that the first of these heuristics has a worst-case relative cost that is between 1.44 and 2, and the second of these heuristics has a worst-case relative cost of 2. Computational tests indicate that, on the average, these heuristics are within 0.7% and 1.3% of optimal, respectively, and that their performance is very insensitive to the size of the system and to other input parameters.

Suggested Citation

  • Robin O. Roundy, 1993. "Efficient, Effective Lot Sizing for Multistage Production Systems," Operations Research, INFORMS, vol. 41(2), pages 371-385, April.
    • Handle: RePEc:inm:oropre:v:41:y:1993:i:2:p:371-385
    DOI: 10.1287/opre.41.2.371
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    Citations

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    Cited by:

    1. N.C. Simpson & S. Selcuk Erenguc, 2005. "Modeling multiple stage manufacturing systems with generalized costs and capacity issues," Naval Research Logistics (NRL), John Wiley & Sons, vol. 52(6), pages 560-570, September.
    2. Sarker, Bhaba R. & Diponegoro, Ahmad, 2009. "Optimal production plans and shipment schedules in a supply-chain system with multiple suppliers and multiple buyers," European Journal of Operational Research, Elsevier, vol. 194(3), pages 753-773, May.
    3. A. Kimms, 1997. "Demand shuffle—A method for multilevel proportional lot sizing and scheduling," Naval Research Logistics (NRL), John Wiley & Sons, vol. 44(4), pages 319-340, June.
    4. Erenguc, S. Selcuk & Simpson, N. C. & Vakharia, Asoo J., 1999. "Integrated production/distribution planning in supply chains: An invited review," European Journal of Operational Research, Elsevier, vol. 115(2), pages 219-236, June.
    5. Kimms, Alf & Drexl, Andreas, 1996. "Multi-level lot sizing: A literature survey," Manuskripte aus den Instituten für Betriebswirtschaftslehre der Universität Kiel 405, Christian-Albrechts-Universität zu Kiel, Institut für Betriebswirtschaftslehre.
    6. Alf Kimms, 1998. "Ablauforganisation bei Serienproduktion in Fließfertigungssystemen," Schmalenbach Journal of Business Research, Springer, vol. 50(7), pages 641-655, July.
    7. Ozelkan, Ertunga C. & Cakanyildirim, Metin, 2007. "Resource downgrading," European Journal of Operational Research, Elsevier, vol. 177(1), pages 572-590, February.
    8. Simpson, N. C., 1999. "Multiple level production planning in rolling horizon assembly environments," European Journal of Operational Research, Elsevier, vol. 114(1), pages 15-28, April.

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