Production planning in furniture settings via robust optimization

Publication year: 2012
Source: Computers & Operations Research, Volume 39, Issue 2, February 2012, Pages 139-150

Douglas, José Alem , Reinaldo, Morabito

Production planning procedures in small-size furniture companies commonly consists of decisions with respect to production level and inventory policy, while attempting to minimize trim-loss, backlogging and overtime usage throughout the planning horizon. Managing these decisions in a tractable way is often a challenge, especially considering the uncertainty of data. In this study, we employ robust optimization tools to derive robust combined lot-sizing and cutting-stock models when production costs and product demands are uncertainty parameters. Our motivation over the traditional two-stage stochastic programming approach is the absence of an explicit probabilistic description of the input data, as well as avoiding to…