An integrated production scheduling and delivery route planning with multi-purpose machines: A case study from a furniture manufacturing company

Recently, many modern industries have adopted joint scheduling of production and distribution decisions. Such coordination is necessary in make-to-order (MTO) businesses, where it is challenging to achieve timely delivery at minimum total cost and meet the requirements for high customization. To deal with these challenges, a practical production configuration and delivery method is required, in addition to a closer link between production and distribution schedules. Hence, in this study, we address an integrated production scheduling-vehicle routing problem with a time window, where it is assumed that production is performed in a flexible job-shop system. Our framework is modeled as a novel bi-objective mixed integer problem, in which the first objective function aims to minimize a sum of the production and distribution scheduling costs, and the second objective function tries to minimize a weighted sum of delivery earliness and tardiness. To practically validate the application of our framework, a case study from a furniture manufacturing company producing customized goods is considered, and experimental data are derived. Based on the real data, the model is first optimally solved by an epsilon-constraint method, and then a Hybrid Particle Swarm Optimization (HPSO) algorithm is developed to solve the model for medium- and large-sized problems in a reasonable time. We discuss the benefits of integration by comparing the results of the proposed model with that of the separate approach. The results show that the company can establish a proper rational balance between cost and customer concerns, and they can use the integration policy as a lever to improve customer satisfaction without the system experiencing a significant increase in total operational cost.