Dynamic order acceptance and capacity planning in a stochastic multi-project environment with a bottleneck resource

Philipp Melchiors, Roel Leus, Stefan Creemers and Rainer Kolisch

International Journal of Production Research, 2018, vol. 56, issue 1-2, 459-475

Abstract: We study the integration of order acceptance and capacity planning in multi-project environments with dynamically arriving projects. We model this planning problem as a continuous-time Markov decision process to determine long-term optimal decisions. We examine whether macro-process planning should be performed before or after order acceptance. We characterise the structure of optimal policies, and explore the dependence on a number of parameters such as project payoff, project cost and order arrival time. We also look into the effects of set-up costs and the use of non-regular capacity.

Date: 2018
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DOI: 10.1080/00207543.2018.1431417

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