The Integrated Decision-Making Support for Integrated Supplier Selection and Production Planning Problems with Discounted Prices

Abstract

A supplier selection problem involves allocating the number of raw materials to purchase from several suppliers, whereas production planning deals with deciding the amount of the products made from those raw materials. In this paper, we propose a newly developed integrated decision-making support in piecewise-objective linear programming that can be used to solve discounted supplier selection and production planning problems. Furthermore, the proposed model solves these two problems in an integrated manner, i.e., the optimal decision optimizes both problems and their interdependent raw material flows. The results of computational simulations demonstrated that the proposed model solved the randomly generated problem and is therefore applicable to solving problems in manufacturing industries.