Analysis of Flexibility in Lot Sizing Problems

• Grant number: 15/18325-9
• Support Opportunities: Scholarships abroad - Research Internship - Post-doctor
• Start date: April 01, 2016
• End date: March 31, 2017
• Field of knowledge: Engineering - Production Engineering - Operational Research
• Principal Investigator: Silvio Alexandre de Araujo
• Grantee: Diego Jacinto Fiorotto
• Supervisor: Raf Jans
• Host Institution: Instituto de Biociências, Letras e Ciências Exatas (IBILCE). Universidade Estadual Paulista (UNESP). Campus de São José do Rio Preto. São José do Rio Preto , SP, Brazil
• Institution abroad: École des Hautes Études Commerciales (HEC Montréal), Canada
• Associated to the scholarship: 14/22816-5 - Analysis of flexibility in lot sizing problems, BP.PD

Abstract

As expected, up to the present stage of the post-doc, we have initiated the studies of flexibility to lot sizing problems. The first source of flexibility that we are working is the machine flexibility. In the standard lot sizing problem on parallel machines, each item can be produced on any of the machines and incurs a setup cost and time before production. In this case we have complete machine flexibility. However, in practice, it can be very costly to install machines that have complete flexibility, especially if the products are very different. Therefore, it might be interesting to only implement a limited amount of flexibility (each machine can produce only certain types of items). We are studying the value of machine flexibility in lot sizing models in order to determine what the best flexibility configuration would be for a given budget in order to balance the benefits and costs of flexibility. In this research project we intend to finish the initial studies on machine flexibility and study an extension the problem, where we consider clients dispersed around the different factories, and there are also distribution costs involved. Furthermore, we will start to analyse the a second source of flexibility that is Bill-Of-Material (BOM) flexibility. In this case, we consider a lot sizing problem of a final product that can be produced by blending different ingredients. The Bill-Of-Material (or recipe) indicates which components (or ingredients) are used and in which proportion. In some productive process there is some flexibility with respect to the proportion imposed for each of the ingredients, where it can vary between a minimum and maximum level instead of being fixed. This provides flexibility in the production planning process.