The impact of flexibility on engineer-to-order production planning

• Published in: International journal of production economics Vol. 239; p. 108183
• Main Authors: Brachmann, Robert, Kolisch, Rainer
• Format: Journal Article
• Language: English
• Published: Elsevier B.V 01.09.2021; Elsevier Science Publishers
• Subjects: Aggregated production planning; Business schools; Engineer-to-Order; Engineers; Flexible resource capacity; Flexible resource demand; Multi-project scheduling; Multi-project scheduling; Aggregated production planning; Engineer-to-Order; Flexible resource capacity; Flexible resource demand
• ISSN: 0925-5273; 1873-7579
• DOI: 10.1016/j.ijpe.2021.108183

This paper addresses the tactical production planning problem of engineer-to-order companies. For this, we extend the resource-constrained project scheduling problem with flexible resource profiles (FRCPSP) to the multi-project case as well as flexible resource availability. We model the problem as a deterministic discrete-time mixed-integer program using step-variables. For each activity the start time, the duration, and the allocation of a given resource requirement over time has to be determined, taking into account precedence constraints between activities and availability of resources. The capacity of resources is not fixed but can vary subject to working time accounts. Using a lexicographic ordering approach, the primary objective is to minimize the total weighted lateness of projects, while the secondary objective is to balance working time accounts. In our computational study, we solve real-world instances from a mid-size company with up to 100 projects and 1725 activities. We show that optimal solutions can be derived in reasonable computation time with off-the-shelf commercial solvers. From a managerial point of view, our results demonstrate the value of flexibility.