Article ID: | iaor1988988 |
Country: | United Kingdom |
Volume: | 27 |
Issue: | 6 |
Start Page Number: | 965 |
End Page Number: | 984 |
Publication Date: | Jun 1989 |
Journal: | International Journal of Production Research |
Authors: | Prentis E.L., Khumawala B.M. |
Keywords: | materials |
The research on lot sizing is extensive; however, no author in the literature reviewed to date provides an optimal solution algorithm to a prevalent problem which is found in manufacturing. A multi-level, general product-structure, variable-cost model is presented which follows the procedure of a closed-loop material requirements planning (MRP) system, and incorporates many conditions that production and material managers find in practice. A branch and bound (B&B) algorithm is developed. The efficiency of B&B is derived from effective lower bounds and solution procedures which are determined on the basis of the space-time structure of the MRP lot-sizing problem and its non-convex total-cost function. This path-dependent lower bound is computationally efficient and guarantees an optimal solution. The B&B algorithm is tested on problems and compared to heuristics in the literature.