Article ID: | iaor20051292 |
Country: | Netherlands |
Volume: | 132 |
Issue: | 1 |
Start Page Number: | 85 |
End Page Number: | 108 |
Publication Date: | Nov 2004 |
Journal: | Annals of Operations Research |
Authors: | Kekre Sunder, Rao Uday, Yi Jinxin, Sarthi Samarth |
Keywords: | planning |
We consider capacity management with a long-term strategic choice, such as the number of production lines to install before demand is known, and short-term tactical decisions relating to production, inventory, and subcontracting (recourse actions made after demand is known). We present an integrated scenario-based mathematical modeling and solution framework. For a single-product environment, we examine properties of total profit as a function of demand and the long-term capacity