A new and general stochastic parallel machine ScheLoc problem with limited location capacity and customer credit risk

Abstract

Scheduling-Location (ScheLoc) problem considering machine location and job scheduling simultaneously is a relatively new and hot topic. The existing works assume that only one machine can be placed at a location, which may not be suitable for some practical applications. Besides, the customer credit risk which largely impacts the manufacturer’s profit has not been addressed in the ScheLoc problem. Therefore, in this work, we study a new and general stochastic parallel machine ScheLoc problem with limited location capacity and customer credit risk. The problem consists of determining the machine-to-location assignment, job acceptance, job-to-machine assignment, and scheduling of accepted jobs on each machine. The objective is to maximize the worst-case probability of manufacturer’s profit being greater than or equal to a given profit (referred to as the profit likelihood). For the problem, a distributionally robust chance-constrained (DRCC) programming model is proposed. Then, we develop two model-based approaches: (1) a sample average approximation (SAA) method; (2) a model-based constructive heuristic. Numerical results of 300 instances adapted from the literature show the average profit likelihood proposed by the constructive heuristic is 9.43% higher than that provided by the SAA, while the average computation time of the constructive heuristic is only 4.24% of that needed by the SAA.