| Having materials at the right place at the right time at lowest possible cost has always been as an important goal of organizations. Depending on the scope and time horizon involved, logistics decisions can be categorized into three hierarchical levels: strategic, tactical, and operational. Strategic decisions require large capital investments and are effective over a long time horizon, ranging from 5 to 10 years.; The main focus of this research is strategic supply chain network design, defined as: Given a set of potential suppliers, potential manufacturing facilities and distribution centers with multiple alternative configurations, determine the configuration of the production-distribution system with the lowest sum of supply, production, transportation, inventory, and facility costs such that customer demands and service requirements are met.; Businesses commonly encounter the strategic production-distribution network design problem whenever expansion, reduction, or reengineering is in progress. However, techniques for integrated and comprehensive modeling and design of distribution systems have not kept up with recent theoretical developments in optimization. The contribution of this research is that it develops an integrated design methodology for strategic production and distribution systems by exploring the relationships between the problems through primal decomposition theory for mixed integer linear programs. The information flow from the production system to the transportation system design is well defined. This research completes the information cycle by defining the data required by the production system from the transportation system for the integrated design of strategic production-distribution systems. It also provides an efficient solution methodology for solving the mixed integer program representing the comprehensive model of strategic production/distribution systems with seasonal customer demands.*; *Originally published in DAI Vol. 57, No. 11. Reprinted here with corrected author name. |
