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Formulation and solution of an optimal control problem for industrial project control

Author

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  • Klaus Werner Schmidt

    (Middle East Technical University)

  • Öncü Hazır

    (Rennes School of Business)

Abstract

In this paper, we consider the monitoring and control of industrial projects that are performed by executing different activities within a given time duration. Hereby, it is desired to apply project control to each activity in order to avoid unexpected deviations in the project cost, respecting that the amount and cost of project control needs to be limited. We model the general setting of industrial project control as an optimal control problem with the goal of maximizing the cost reduction (savings) when applying control, while meeting constraints on the control effort. We then prove that it is optimal to apply a constant control effort to each activity during a given time duration. Consequently, we show that the exact optimal control solution can be obtained by nonlinear programming. We illustrate our results by an application example from the construction industry.

Suggested Citation

  • Klaus Werner Schmidt & Öncü Hazır, 2019. "Formulation and solution of an optimal control problem for industrial project control," Annals of Operations Research, Springer, vol. 280(1), pages 337-350, September.
    • Handle: RePEc:spr:annopr:v:280:y:2019:i:1:d:10.1007_s10479-019-03262-7
    DOI: 10.1007/s10479-019-03262-7
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    References listed on IDEAS

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