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Determining optimal growth paths in logistics operations

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  • V. Srinivasan
  • G. L. Thompson

Abstract

This paper considers a logistics system modelled as a transportation problem with a linear cost structure and lower bounds on supply from each origin and to each destination. We provide an algorithm for obtaining the growth path of such a system, i. e., determining the optimum shipment patterns and supply levels from origins and to destinations, when the total volume handled in the system is increased. Extensions of the procedure for the case when the costs of supplying are convex and piecewise linear and for solving transportation problems that are not in “standard form” are discussed. A procedure is provided for determining optimal plant capacities when the market requirements have prespecified growth rates. A goal programming growth model where the minimum requirements are treated as goals rather than as absolute requirements is also formulated.

Suggested Citation

  • V. Srinivasan & G. L. Thompson, 1972. "Determining optimal growth paths in logistics operations," Naval Research Logistics Quarterly, John Wiley & Sons, vol. 19(4), pages 575-599, December.
    • Handle: RePEc:wly:navlog:v:19:y:1972:i:4:p:575-599
    DOI: 10.1002/nav.3800190403
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