Accelerating Benders decomposition approach for robust aggregate production planning of products with a very limited expiration date

Benders Decomposition Algorithm for Robust Aggregate Production Planning Considering Pricing Decisions in Competitive Environment: A Case Study

“…Their approach, called \Elastic p-Robustness," resolved the need for estimating the probability distribution of uncertain parameters when managing operational uncertainties of SC. Using production postponement policy, Makui et al [7] contributed the robust APP problem to the literature for products with a very limited expiration date. In fact, they developed the model proposed by Leung and Ng [49].…”

“…Because one manufacturer company has more power to acquire market share and act as a leader, the competition is modeled using BLP with regard to the concept of Stackelberg game [15], which properly matches the problem. Also, the basic APP model has been taken from the study by Makui et al [7] and developed for the real competitive conditions. Figure 1 clearly illustrates the structure of the problem and the relationship between the leader and the follower in the competitive market.…”

“…Using the scenario-based robust stochastic programming, the concepts of solution robustness and model robustness, which are illustrated in Section 5.3, can be integrated. It also should be noted that some basic studies have used this approach for the APP and they note that \as economic scenarios are taken into account, changes in uncertain data do not have signi cant e ect on an optimized production planning" [7,64]. The interested readers can refer to references [10,61,[65][66][67][68][69][70][71] to obtain more information about the robust optimization ap-proach.…”

“…As one of the most important problems in production systems, especially in current competitive mar-kets, production planning aims at coordinating the production activities and providing an e ective plan that optimizes objectives of the companies. In fact, production planning is a decision-making process of allocating resources to the production activities in a cost-e ective manner that makes it possible for the manufacturer to be the winner of the competitive market [7]. APP, as a special production planning, comprises the simultaneous determination of production, inventory, and employment levels as well as other important production variables of a company during a nite planning horizon.…”

“…Considering the inherent uncertainty makes the modeling of problems much closer to the real conditions. According to the research of Makui et al [7], the APP problems are among the strongly NPhard ones and the use of meta-heuristic methods for solving such problems would not guarantee obtaining accurate and global optimal solutions. Consequently, it can be claimed that the developed model is NPhard and an e cient algorithm is needed to overcome its computational complexity.…”