Advanced search
Add to list

Capacity allocation and safety stock placement in general acyclic supply chains with budget and storage space constraints under the guaranteed service approach

Foad Ghadimi (UGent) and Tarik Aouam (UGent)
(2020)
Author
Organization
Abstract
This paper addresses the problem of production capacity and safety stock placement in general acyclic supply chains facing demand uncertainty. The problem consists of setting capacity at production stages with capacity-dependent lead times and safety stocks at logistics stages in order to minimize total supply chain cost and meeting a target customer service level. We consider the case where different parts of the supply chain have limited budgets to allocate capacity, i.e. budget groups, and inventory holding locations have finite storage space. Following the guaranteed service approach (GSA), the problem is first formulated as a mixed integer nonlinear program (MINLP) and then a Lagrangian decomposition method is presented to solve the production capacity and safety stock placement problem. Computational experiments on data sets adapted from real-world supply chains show that a standard MINLP solver is unable to provide feasible solutions even for small instances, while the proposed solution procedure finds optimal or near-optimal solutions.
Keywords
Supply chain management, production capacity, storage capacity, safety stocks, guaranteed service, Lagrangian decomposition.

Citation

Please use this url to cite or link to this publication:

MLA
Ghadimi, Foad, and Tarik Aouam. Capacity Allocation and Safety Stock Placement in General Acyclic Supply Chains with Budget and Storage Space Constraints under the Guaranteed Service Approach. 2020.
APA
Ghadimi, F., & Aouam, T. (2020). Capacity allocation and safety stock placement in general acyclic supply chains with budget and storage space constraints under the guaranteed service approach. Presented at the Twenty-first International Working Seminar on Production Economics, Innsbruck, Austria.
Chicago author-date
Ghadimi, Foad, and Tarik Aouam. 2020. “Capacity Allocation and Safety Stock Placement in General Acyclic Supply Chains with Budget and Storage Space Constraints under the Guaranteed Service Approach.” In .
Chicago author-date (all authors)
Ghadimi, Foad, and Tarik Aouam. 2020. “Capacity Allocation and Safety Stock Placement in General Acyclic Supply Chains with Budget and Storage Space Constraints under the Guaranteed Service Approach.” In .
Vancouver
1.
Ghadimi F, Aouam T. Capacity allocation and safety stock placement in general acyclic supply chains with budget and storage space constraints under the guaranteed service approach. In 2020.
IEEE
[1]
F. Ghadimi and T. Aouam, “Capacity allocation and safety stock placement in general acyclic supply chains with budget and storage space constraints under the guaranteed service approach,” presented at the Twenty-first International Working Seminar on Production Economics, Innsbruck, Austria, 2020.
@inproceedings{8654273,
  abstract     = {This paper addresses the problem of production capacity and safety stock placement in general acyclic supply chains facing demand uncertainty. The problem consists of setting capacity at production stages with capacity-dependent lead times and safety stocks at logistics stages in order to minimize total supply chain cost and meeting a target customer service level. We consider the case where different parts of the supply chain have limited budgets to allocate capacity, i.e. budget groups, and inventory holding locations have finite storage space. Following the guaranteed service approach (GSA), the problem is first formulated as a mixed integer nonlinear program (MINLP) and then a Lagrangian decomposition method is presented to solve the production capacity and safety stock placement problem. Computational experiments on data sets adapted from real-world supply chains show that a standard MINLP solver is unable to provide feasible solutions even for small instances, while the proposed solution procedure finds optimal or near-optimal solutions.},
  author       = {Ghadimi, Foad and Aouam, Tarik},
  keywords     = {Supply chain management,production capacity,storage capacity,safety stocks,guaranteed service,Lagrangian decomposition.},
  language     = {eng},
  location     = {Innsbruck, Austria},
  title        = {Capacity allocation and safety stock placement in general acyclic supply chains with budget and storage space constraints under the guaranteed service approach},
  year         = {2020},
}