Process Flexibility for Multiperiod Production Systems

Cong Shi (), Yehua Wei () and Yuan Zhong ()
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Cong Shi: Industrial and Operations Engineering, University of Michigan, Ann Arbor, Michigan 48109
Yehua Wei: Carroll School of Management, Boston College, Chestnut Hill, Massachusetts 02467
Yuan Zhong: Booth School of Business, University of Chicago, Chicago, Illinois 60637

Operations Research, 2019, vol. 67, issue 5, 1300-1320

Abstract: We develop a theory for the design of process flexibility in a multiperiod make-to-order production system. We propose and formalize a notion of “effective chaining” termed the generalized chaining gap (GCG), which can be viewed as a natural extension of classical chaining structure from the process flexibility literature. Using the GCG, we prove that, in a general system with high capacity utilization, one only needs a sparse flexibility structure with m plus n arcs to achieve similar performance as full flexibility, where m and n are equal to the number of plants and products in the system, respectively. The proof provides a simple and efficient algorithm for finding such sparse structures. Also, we show that the requirement of m plus n arcs is tight by explicitly constructing systems in which even the best flexibility structure with m plus n minus 1 arcs cannot achieve the same asymptotic performance as full flexibility. The goal of this paper is to make progress toward the better understanding of the key design principles of process flexibility structures in a multiperiod environment.

Keywords: process flexibility; flexible production; multiperiod; capacity planning; chaining condition (search for similar items in EconPapers)
Date: 2019
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Citations: View citations in EconPapers (12)

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