Simulation of Decentralized Planning in Two Danish Organizations Using Linear Programming Decomposition

John Christensen and Börge Obel
Additional contact information
John Christensen: Odense University
Börge Obel: Odense University

Management Science, 1978, vol. 24, issue 15, 1658-1667

Abstract: This paper describes the results of two studies where decentralized planning has been simulated. The coordination mechanisms employed were based on the Dantzig-Wolfe decomposition algorithm, and the Ten Kate decomposition algorithm, which are price directive and budget directive planning procedures, respectively. The importance of the results is that the data and the structure of the two planning problems come from real organizations--a cooperative slaughterhouse and a forecast model for Danish agriculture. Thus conclusions based on using a price-directive and a budget-directive planning method to simulate decentralized planning in these organizations have relevance to the potential value of using such methods in real organizations. The main conclusions concern the importance of and the difficulties in finding good starting strategies for the two methods and the impact of the organizational structure on the rate of improvement for the methods.

Keywords: organizational studies: design; budget model; price model (search for similar items in EconPapers)
Date: 1978
References: Add references at CitEc
Citations: View citations in EconPapers (6)

Downloads: (external link)
http://dx.doi.org/10.1287/mnsc.24.15.1658 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:inm:ormnsc:v:24:y:1978:i:15:p:1658-1667

Access Statistics for this article

More articles in Management Science from INFORMS Contact information at EDIRC.
Bibliographic data for series maintained by Chris Asher ().