Journal
OMEGA-INTERNATIONAL JOURNAL OF MANAGEMENT SCIENCE
Volume 33, Issue 4, Pages 307-318Publisher
PERGAMON-ELSEVIER SCIENCE LTD
DOI: 10.1016/j.omega.2004.05.001
Keywords
production planning; mean-risk; stochastic programming; mixed 0-1 programs; splitting variable; branch-and-fix coordination
Ask authors/readers for more resources
We present a two-stage full recourse model for strategic production planning under uncertainty, whose aim consists of determining product selection and plant dimensioning. The main uncertain parameters are the product price, demand and production cost. The benefit is given by the product net profit over the time horizon minus the investment depreciation and operation costs. The Value-at-Risk and the reaching probability are considered as risk measures in the objective function to be optimized as alternatives to the maximization of the expected benefit over the scenarios. The uncertainty is represented by a set of scenarios. The problem is formulated as a mixed 0-1 Deterministic Equivalent Model. The strategic decisions to be made in the first stage are represented by 0-1 variables. The tactical decisions to be made in the second stage are represented by continuous variables. An approach for problem solving based on a splitting variable mathematical representation via scenario is considered. The problem uses the Twin Node Family concept within the algorithmic framework known as Branch-and-Fix Coordination for satisfying the nonanticipativity constraints. Some computational experience is reported. (c) 2004 Elsevier Ltd. All rights reserved.
Authors
I am an author on this paper
Click your name to claim this paper and add it to your profile.
Reviews
Recommended
No Data Available