Stochastic modelling and optimisation of multi-plant capacity planning problem. (9th December 2014)

• Record Type: Journal Article
• Authors: Verma, Anoop; Shukla, Nagesh; Tyagi, Satish; Mishra, Nishikant
• Is Part Of: International journal of intelligent engineering informatics. Volume 2: Number 2/3 (2014)
• Page Start: 139
• Page End: 165
• Publication Date: 2014-12-09
• Subjects: capacity planning -- stochastic optimisation -- AMPL/CPLEX -- Markowitz-mean variance; Artificial intelligence -- Engineering applications -- Periodicals; Engineering -- Computer programs -- Periodicals; Knowledge management -- Periodicals; 620.0028563
• Languages: English
• ISSNs: 1758-8715

Abstract

In this paper, the problem of capacity planning under risk from demand and price/cost uncertainty of the finished products is addressed. The deterministic model is extended into a two-stage stochastic model with fixed recourse by means of various expected levels of demand as random. A recourse penalty is also included in the objective for both shortage and surplus in the finished products. The model is analysed to quantify the risk using Markowitz mean-variance model.