Planning Production and Workforce in a Discrete-Time Financial Model: Optimizing Cash-Flows Released

Pedro Martins ()
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Pedro Martins: Quinta Agrícola - Bencanta

A chapter in Computational Management Science, 2016, pp 115-121 from Springer

Abstract: Abstract Production planning interacts with a number of functional aspects within the entire system of a company. Two of those aspects involve workforce and financial planning. In effect, growing production amounts may demand further workforce, which increases financial costs. On the contrary, lower levels of production may decrease workforce needs, while possibly resulting in lower financial incomes. So, there should exist an adequate balance on the production levels such that the cash-flows can generate the highest returns, along the entire financial stream. This suggests that these three elements of the system (production, workforce and cash-flows) are tightly connected, and that they should be planned together. This paper discusses this interaction, proposing a mixed integer linear programming formulation for a general outline of this three elements system. In order to simplify the discussion, while focusing in the interaction, we consider a single-product in a capacitated production process. Decisions involving cash-flows released along the planning horizon are also incorporated, including dividends payments, allowing the system to decide when and how much should be released outwards such that a given sustainability condition or a final outcome condition is met.

Keywords: Planning Horizon; Mixed Integer Linear Programming; Initial Capital; Production Stream; Cash Balance (search for similar items in EconPapers)
Date: 2016
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Persistent link: https://EconPapers.repec.org/RePEc:spr:lnechp:978-3-319-20430-7_15

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DOI: 10.1007/978-3-319-20430-7_15

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