On the importance of sequencing decisions in production planning and scheduling

We discuss the traditional hierarchical approach to production planning and scheduling, emphasiziing the fact that scheduling constraints are often either ignored or considered in a very crude way. In particular, we underline that the way scheduling is carried out is crucial for the capacity constraints on the lot sizes. Usual methods to handle capacity in theory or in practice are reviewed. Finally, we present an approach that tries to overcome these drawbacks by capturing the shop-floor capacity through scheduling considerations.