Operational planning models for distribution networks

The design and optimisation of a logistic network deals with a wide set of decisions, e.g. the determination of the best location and capacity of the different logistic facilities (production plants, distribution centres, transit points, wholesalers, etc.), the allocation of the product demand coming from customers in presence (or absence) of fractionable flows of material, the determination of the best transportation mode (truck, rail, etc.) as well as loading and routing of vehicles. These decisions involve multiple stages of a distribution network: customers-regional distribution centres (RDC), RDCs-central distribution centres (CDC) and CDCs-production plants and sources, in presence of multiple products and the variable time (i.e. time-dependent product demand and flows of material). This paper presents a top-down methodology that joins the strategic planning, the tactical planning and the operational planning of distribution networks with a special focus on the development of effective heuristic methods to face the vehicle routing problem. Original models and heuristic algorithms for the operational planning are illustrated. The impact of the strategic and tactical decisions on the performance of the operational planning is evaluated by the application of the proposed hierarchical approach to two realistic case studies. Obtained results are illustrated in a what-if experimental analysis conducted on multiple problem settings and realistic scenarios.     

A multi-objective simulated annealing approach to reactive power compensation

Reactive power compensation is an important problem in electrical distribution systems, involving the sizing and location of capacitors (sources of reactive power). The installation of capacitors also contributes to releasing system capacity and improving voltage level. A multi-objective simulated annealing approach to provide decision support in this problem is presented. This approach is able to compute a set of well-distributed and diversified solutions underlying distinct trade-offs, even for a challenging network. The characterization of the non-dominated front is relevant information for aiding planning engineers to select satisfactory compromise solutions (compensation schemes) to improve the network operation conditions.     

On the use of the hybrid causal logic method in offshore risk analysis

In the Norwegian offshore oil and gas industry risk analyses have been used to provide decision support for more than 20 years. The focus has traditionally been on the planning phase, but during the last years a need for better risk analysis methods for the operational phase has been identified. Such methods should take human and organizational factors into consideration in a more explicit way than the traditional risk analysis methods do. Recently, a framework, called hybrid causal logic (HCL), has been developed based on traditional risk analysis tools combined with Bayesian belief networks (BBNs), using the aviation industry as a case. This paper reviews this framework and discusses its applicability for the offshore industry, and the relationship to existing research projects, such as the barrier and operational risk analysis project (BORA). The paper also addresses specific features of the framework and suggests a new approach for the probability assignment process. This approach simplifies the assignment process considerably without loosing the flexibility that is needed to properly reflect the phenomena being studied.     

An integrated approach for production and distribution planning in supply chain management

Many firms have been trying to optimize their production and distribution systems separately, but using this approach limits any possible increase in profit. Thus, it is becoming more important to analyse these two systems simultaneously. This paper presents the solutions for integrated production and distribution planning and investigates the effectiveness of their integration through a computational study, in a multi-plant, multi-retailer, multi-item, and multi-period logistic environment where the objective is to maximize the total net profit. Computational results on test problems using the proposed heuristic confirm the substantial advantage of the integrated planning approach over the decoupled one. Sensitivity analysis on the input parameters indicates that, under the right conditions, the effectiveness of integrating production and distribution functions can be extremely high.     

Combined strategic and operational planning – an MILP success story in chemical industry

We describe and solve a real world problem in chemical industry which combines operational planning with strategic aspects. In our simultaneous strategic & operational planning (SSDOP) approach we develop a model based on mixed-integer linear (MILP) optimization and apply it to a real-world problem; the approach seems to be applicable in many other situations provided that people in production planning, process development, strategic and financial planning departments cooperate. The problem is related to the supply chain management of a multi-site production network in which production units are subject to purchase, opening or shut-down decisions leading to an MILP model based on a time-indexed formulation. Besides the framework of the SSDOP approach and consistent net present value calculations, this model includes two additional special and original features: a detailed nonlinear price structure for the raw material purchase model, and a detailed discussion of transport times with respect to the time discretization scheme involving a probability concept. In a maximizing net profit scenario the client reports cost saving of several millions US$. The strategic feature present in the model is analyzed in a consistent framework based on the operational planning model, and vice versa. The demand driven operational planning part links consistently to and influences the strategic. Since the results (strategic desicions or designs) have consequences for many years, and depend on demand forecast, raw material availability, and expected costs or sales prices, resp., a careful sensitivity analysis is necessary showing how stable the decisions might be wit h respect to these input data.     

‘Domain-specific’ patent analytics: Focus on company's technology priorities

This paper aims to depict a new usage of patent analytics on a corporate level mitigating the gap between strategy (technology policy making) and operational activities (R&D program development and actualisation).The approach proposed for such mitigation is based on three techniques enriching patent analytics practical implementation:1) knowledge modelling techniques;2) deep technical analysis based on knowledge model;3) ‘insight-driven analytics’ approach.Such three techniques aim to facilitate the implementation of PL in the company's technology management processes.The paper contains examples related to oil & gas, transport, and water treatment industries.     

Aggregate production planning for shipbuilding with variation-inventory trade-offs

Shipbuilding is a complex production system characterised by a complicated work and organisation structure, prolonged production lead time, and heterogeneous resource requirements. Thus, effectively planning all involved activities presents a challenging task and requires the timely coordination between the successive production stages at the plant level and effective resource allocation at the workshop level. With the work breakdown structure of all projects and their corresponding building strategies, the aggregate production planning (APP) is to address two important issues, namely, workforce level and inventory usage so that the fluctuating demands from downstream processes can be satisfied in a cost-effective manner. To achieve this, a novel APP model is proposed for ship production to minimise the variation of aggregate man-hour over the planning horizon and simultaneously minimise the logistic demands of the interim products. In view of the combinatorial nature and computational complexity, a directed genetic algorithm based solver has been developed to solve the two-conflicting-objective optimisation problem. The proposed approach has been applied to a case study and preliminary results have shown certain effectiveness in handling various situations with different planning strategies.     

Integration of manufacturing and distribution networks in a global car company – network models and numerical simulation

Global supply chain practices and their effects have received considerable attention over the last two decades. In the recent past, the need for integration across supply chains has been identified as a key for effective and efficient operations of supply chains. This is observed with the increasing trend of collaborative partnerships among supply chain partners. This paper presents an integrated approach for manufacturing and distribution networks within the supply chain system of a global car company. The paper shows that the integration of manufacturing and distribution networks creates the environment for effective planning of many components and execution/follow-up of those plans. These components include materials, resources, operations/activities, suppliers and customers. The main features of the integration include component integration at individual networks via use of a central warehouse. This integration reduces various interfacing steps between partners and enables representations of relationships (component precedence, parent-component and component-component). The proposed integrated model is numerically tested using past data from one of Japan's auto-makers, based in the emerging economy of Thailand. The paper concludes that the integrated supply network eliminates the need for interfacing of individual networks and enables simultaneous planning of many components as well as forward planning of supply components in global supply chain operations. It also shows that the integrated approach is capable of providing visibility, flexibility, and maintainability for further improvement in the supply network environment.     

Safety models incorporating graph theory based transit indicators

There is a considerable need for tools to enable the evaluation of the safety of transit networks at the planning stage. One interesting approach for the planning of public transportation systems is the study of networks. Network techniques involve the analysis of systems by viewing them as a graph composed of a set of vertices (nodes) and edges (links). Once the transport system is visualized as a graph, various network properties can be evaluated based on the relationships between the network elements. Several indicators can be calculated including connectivity, coverage, directness and complexity, among others. The main objective of this study is to investigate the relationship between network-based transit indicators and safety. The study develops macro-level collision prediction models that explicitly incorporate transit physical and operational elements and transit network indicators as explanatory variables. Several macro-level (zonal) collision prediction models were developed using a generalized linear regression technique, assuming a negative binomial error structure. The models were grouped into four main themes: transit infrastructure, transit network topology, transit route design, and transit performance and operations. The safety models showed that collisions were significantly associated with transit network properties such as: connectivity, coverage, overlapping degree and the Local Index of Transit Availability. As well, the models showed a significant relationship between collisions and some transit physical and operational attributes such as the number of routes, frequency of routes, bus density, length of bus and 3+ priority lanes.     

Multi-period response management to contaminated water distribution networks: dynamic programming versus genetic algorithms

Previous studies on consequence management assume that the selected response action including valve closure and/or hydrant opening remains unchanged during the entire management period. This study presents a new embedded simulation-optimization methodology for deriving time-varying operational response actions in which the network topology may change from one stage to another. Dynamic programming (DP) and genetic algorithm (GA) are used in order to minimize selected objective functions. Two networks of small and large sizes are used in order to illustrate the performance of the proposed modelling schemes if a time-dependent consequence management strategy is to be implemented. The results show that for a small number of decision variables even in large-scale networks, DP is superior in terms of accuracy and computer runtime. However, as the number of potential actions grows, DP loses its merit over the GA approach. This study clearly proves the priority of the proposed dynamic operation strategy over the commonly used static strategy.     

Implications of form postponement to manufacturing: a case study

Postponement is an approach that helps to deliver more responsive supply chains. Form postponement involves the delay of final manufacturing until a customer order is received and is commonly regarded as an approach to mass customization. However, while much is written in the literature about the benefits and strategic impact of form postponement, little is still known about its application. This paper addresses how form postponement was applied in terms of its operational implications within a manufacturing facility through a retrospective study that tracked implementation of form postponement in a manufacturer of specialist high-voltage cabling equipment, called here ‘ElectriCo’. The operational measures for products selected for form postponement were compared with those for products that continued to be made under make-to-order and make-to-stock regimes. Propositions were tested that addressed the operational implications of form postponement within the manufacturing facility, the impact of form postponement on selected performance metrics, and the demand profile for which form postponement was the preferred regime. Multiple data collection methods were used whereby documentary, archival and database evidence were used to measure operational characteristics across a broad front. The findings show that form postponement improved responsiveness but did not necessarily improve delivery reliability. The extent to which the order lead time can be reduced is dependent not only on the responsiveness of the postponed process, but also crucially on the responsiveness of the planning system. It was found that the problem of adapting the manufacturing planning and production scheduling systems at ElectriCo had been underestimated. This and other problems subsequently undermined the form postponement application and led to its eventual abandonment. The authors are undertaking further research of form postponement applications in different production contexts to provide further evidence for its operational implications.     

A novel approach for operational optimization of multi-stage refrigeration cycles in gas refineries

The efficient use of energy in refrigeration cycles of gas liquefaction plants is a contemporary topic of interest. The previous optimization studies on refrigeration cycles have not considered the components' operational limitations. By considering the fact that in operating plants, all constraints must be thoroughly taken into account, this paper presents a novel approach for operational optimization of in-use refrigeration cycles which takes into account the operational limitations of the components as well as the interaction between the refrigeration cycle and the core process. This novel approach exploits a combination of thermodynamic principles and pinch technology to express the multi-stage refrigeration cycles' power consumption as a function of several independent variables. To examine the applicability of the proposed approach, it is used to optimize a three-stage refrigeration cycle in a propane liquefaction plant. About 15.4% reduction in the specific power consumption is achieved.     

Strategic purchasing participation,supplier selection,supplier evaluation and purchasing performance

In this article, we examine how purchasing’s strategic participation influences supply management activities via the choice of appropriate operational and strategic criteria. Specifically, the study focuses on supplier selection and monitoring ongoing supplier performance evaluation based on operational and strategic criteria. A combination of choosing appropriate supplier selection criteria and monitoring supplier performance ensures that the benefits of purchasing’s participation in strategic planning translate into better purchasing performance of cost, quality, delivery, flexibility and innovation. We test the hypotheses using survey data collected from manufacturing companies in the US by means of a path model. Our results provide support for the tenet that purchasing’s participation in strategic planning influences purchasing performance directly as well as through the mediating effects of supplier selection criteria and supplier performance evaluation. We discuss the theoretical and managerial implications of the findings and propose directions for further research.     

Coordination Approaches and Systems – Part II: An Operational Perspective

This is the second of two papers surveying research in coordination approaches and systems. This paper is concerned with operational coordination, which is aimed at coordinating activities such that the design process can be performed in a near optimal manner with respect to time, and the allocation and utilisation of resources. Aspects of coordination categorised as operational include resource management, scheduling and planning. The first of these two papers presents a review of coordination from a strategic perspective, which is concerned with the decision management aspects of coordination. Greater emphasis is now being placed on the significance of organising the design process as this affects time to market, product quality, cost, and consequently product success. The aim of this paper is to present a fundamental review of operational coordination approaches and systems. The 1990s has seen much progress being made towards a greater understanding and appreciation of coordination in various disciplines through the development of a wide range of approaches and systems. However, there remains a requirement to formally identify the key issues involved in coordination such that a widely accepted representation can be agreed upon. Consequently, research should continue to be supported in the exploration for a unified approach to coordination which will permit a broader and greater understanding of those aspects involved.     

企业"走出国门"应有的步骤

基于国际经营成功的实践,论述了企业“走出国门”应有的步骤,即评价自身潜力,接受专家忠告与咨询,选择走出去的国家,制订国际战略及经营计划,选择销售中介及检查实施情况及追踪决策。     

Lifecycle operational reliability assessment of water distribution networks based on the probability density evolution method

In this study, a lifecycle operational reliability assessment framework for water distribution networks (WDNs) is proposed on the basis of the probability density evolution method (PDEM). The occurrence models of daily accidents are fitted using the maintenance data provided by a local water administration sector. For a given accident, two types of accidents (e.g., leaks and bursts) are distinguished in different occurrence probabilities and simulated in various ways. The pipe deterioration process in the lifecycle is reflected by incorporating the time-dependent pipe roughness model. Considering various randomness in the model, PDEM, a newly proposed and developed method for a stochastic system, is used to evaluate the lifecycle operational reliability of WDNs. The framework is demonstrated using an actual WDN, and the nodal reliabilities in the lifecycle are obtained. Comparisons of the operational reliabilities of all nodes calculated via the PDEM and Monte Carlo simulations prove that PDEM is an accurate and highly efficient method.     

A manufacturing control model

Be it teaching or discussing logistic target attainment with practitioners, there is often a confusing gap between the manufacturing control methods applied on the one hand and the logistic objectives on the other hand. Which method is appropriate to increase on-time delivery, which to decrease the WIP? When configuring manufacturing control the discussion often quickly turns to choosing one method over the other and too often the results are disappointing. In order to provide a framework for a more systematic approach, a model has been developed that links the tasks of manufacturing planning and control with the logistic objectives.     

Work-in-process clearing in supply chain operations planning

In this study we provide insights into the effectiveness of the clearing function concept in a hierarchical planning context. The clearing function is a mathematical representation of the relation between the Work-In-Process (WIP) and the throughput of a production process. We use it in a deterministic order release planning model to anticipate the dynamics of the operational level, which is subject to uncertainties. A multi-period single-item order release and scheduling problem is considered in which the delivery schedule of the orders is determined through the planned lead times, and the capacity loading decisions are separated from the order release decisions in a way so as to plan for on-time deliveries. Early or late delivery of the orders, which are released and delivered in batches, has not been considered explicitly in previous studies on clearing functions, and it significantly affects the inventory costs. Both linear and non-linear clearing functions are tested using a simulation approach. The results indicate that modeling the clearing of WIP by a shop should be based on the short-term operational dynamics of the shop rather than on the long-term average shop behavior, since it improves the consistency between the operational planning and scheduling levels of the hierarchy. The presented methods and results provide valuable information on modeling production characteristics in aggregate production planning and scheduling models.     

Operational Planning of Verification of Measuring Instruments of Complicated Technical Systems

The effectiveness of operational planning of measuring instrument verification is assessed, using the example of the ARM-2 automated work station in a mobile measuring technique laboratory. An operational planning algorithm for measuring instrument verification is presented.