An effective two-phase approach in solving a practical multi-site order scheduling problem

Abstract

The trend of globalization has been driving the investment of multi-site production facilities to improve both service level and production costs. Uneven distribution or insufficient capacity may occur occasionally. Facing a multi-site production planning problem, a fishing-net manufacturing company owning three factories in different countries needs to negotiate with customers and plan the production schedule more accurately. Aiming at maximizing profit, a two-phase planning model is built. In the first phase, a heuristic is designed to screen out the orders that cannot be satisfied. The planner will then negotiate with customers to postpone the due date or to cancel these orders. The accepted orders are planned by the second phase that uses integer programming formulation to solve the multi-site production planning problem. The proposed methodology is compared with the existing method. Simulation is adopted for the empirical illustrations. The results are very promising for the proposed methodology for solving practical applications.