Compacity planning in manufacturing and computer networks

This paper addresses capacity planning in manufacturing and computer networks. More specifically, given a manufacturing or computer system modeled as a network of queues, we consider the minimum cost selection of capacity levels from a discrete set of choices such that a single system performance constraint is satisfied. We focus on settings where the cost of obtaining capacity is a concave function, allowing fixed charges and economies of scale to be handled. To solve this class of capacity planning problems, we present a branch and bound algorithm that globally minimizes a concave cost function over a single convex nonlinear performance constraint and lower and upper bounds on the discrete capacity variables. We also present reoptimization procedures that allow the subproblems to be solved more efficiently. Computational results with the algorithm are reported.