Abstract
In this study we focus on coordination of the production planning of finished products and intermediate products in the process industry. The problem consists of two manufacturing facilities with similar production environment, one producing the intermediates and the other producing end products that are separated by a distance. There is transportation between the facilities. The problem considered has been formulated as a Mixed Integer linear Programming problem (MIP). In this study we present, integrated approach and two-step approach to solve the production and transportation problem over the two manufacturing facilities. Our computational study, which compares the results from the two approaches, shows a significant cost reduction is achieved using the integration approach, however, the decision maker may not be able to obtain results in real time to be of any use for implementation since computational time will increase exponentially as the number of integer variables increase.
Highlights
In recent years, there has been an increased interest in coordinated production planning problems in the multi product chemical industry
Models for both approaches are developed for 12 time periods; our extensive computational works conclude that in order to find optimal solution in good computational time, the number of integer variables has to be reduced
One practical way of solving this problem that we have find it useful is to restrict the integer variables to certain time horizon, in our case, the solutions are developed for 12 time periods of which 6 are with integer restrictions and the remaining planning periods are free from such restrictions
Summary
There has been an increased interest in coordinated production planning problems in the multi product chemical industry. We present two approaches that aim to solve production and transportation problem over two manufacturing facilities. = Bmax it Maximum batch size of end product i in period t rmt = Total regular time in hours available in period t in facility II Skt = Set up cost per batch for intermediate k in period t hkt = Inventory carrying cost per unit of intermediate product k per period t rt = Cost per man-hour of regular time labour in period t in facility I
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