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Capacity Optimization Planning System (CAPS)

Author

Listed:
  • Stuart Bermon

    (IBM Thomas J. Watson Research Center, PO Box 218, Yorktown Heights, New York 10598)

  • Sarah Jean Hood

    (IBM Thomas J. Watson Research Center, PO Box 218, Yorktown Heights, New York 10598)

Abstract

IBM's capacity optimization planning system (CAPS) is a decision-support system based on linear programming for strategic planning of semiconductor manufacturing capacity. CAPS finds the volume mix of products to maximize profit, constrained by the existing tool capacity, or identifies the tool capacity required to manufacture a specified mix of products. The major challenge was formulating the linear program to reflect the available manufacturing capacity. The formulation has to deal with parallel, unrelated tool groups that may perform the same operation at different rates, to capture the preferential order in which to use such tool groups, and to identify which are the true bottlenecks. Capacity planners use CAPS to reconcile product-demand forecasts with the available or planned manufacturing capacity and to generate requests for capital investments. The manager of site operations credits CAPS with identifying tens of millions of dollars in revenue opportunities and with avoiding significant unnecessary capital expenditures.

Suggested Citation

  • Stuart Bermon & Sarah Jean Hood, 1999. "Capacity Optimization Planning System (CAPS)," Interfaces, INFORMS, vol. 29(5), pages 31-50, October.
    • Handle: RePEc:inm:orinte:v:29:y:1999:i:5:p:31-50
    DOI: 10.1287/inte.29.5.31
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    Citations

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    Cited by:

    1. S Eom & E Kim, 2006. "A survey of decision support system applications (1995–2001)," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 57(11), pages 1264-1278, November.
    2. Francisco Barahona & Stuart Bermon & Oktay Günlük & Sarah Hood, 2005. "Robust capacity planning in semiconductor manufacturing," Naval Research Logistics (NRL), John Wiley & Sons, vol. 52(5), pages 459-468, August.
    3. Woonghee Tim Huh & Robin O. Roundy & Metin Çakanyildirim, 2006. "A general strategic capacity planning model under demand uncertainty," Naval Research Logistics (NRL), John Wiley & Sons, vol. 53(2), pages 137-150, March.
    4. Romauch, Martin & Hartl, Richard F., 2017. "Capacity planning for cluster tools in the semiconductor industry," International Journal of Production Economics, Elsevier, vol. 194(C), pages 167-180.
    5. Woonghee Tim Huh & Robin O. Roundy, 2005. "A continuous‐time strategic capacity planning model," Naval Research Logistics (NRL), John Wiley & Sons, vol. 52(4), pages 329-343, June.
    6. C A Poojari & C Lucas & G Mitra, 2008. "Robust solutions and risk measures for a supply chain planning problem under uncertainty," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 59(1), pages 2-12, January.
    7. Caner TaskIn, Z. & Tamer Ünal, A., 2009. "Tactical level planning in float glass manufacturing with co-production, random yields and substitutable products," European Journal of Operational Research, Elsevier, vol. 199(1), pages 252-261, November.
    8. Geng, Na & Jiang, Zhibin & Chen, Feng, 2009. "Stochastic programming based capacity planning for semiconductor wafer fab with uncertain demand and capacity," European Journal of Operational Research, Elsevier, vol. 198(3), pages 899-908, November.
    9. Brian T. Denton & John Forrest & R. John Milne, 2006. "IBM Solves a Mixed-Integer Program to Optimize Its Semiconductor Supply Chain," Interfaces, INFORMS, vol. 36(5), pages 386-399, October.
    10. Steven M. Brown & Thomas Hanschke & Ingo Meents & Benjamin R. Wheeler & Horst Zisgen, 2010. "Queueing Model Improves IBM's Semiconductor Capacity and Lead-Time Management," Interfaces, INFORMS, vol. 40(5), pages 397-407, October.
    11. Shabbir Ahmed & Nikolaos V. Sahinidis, 2003. "An Approximation Scheme for Stochastic Integer Programs Arising in Capacity Expansion," Operations Research, INFORMS, vol. 51(3), pages 461-471, June.
    12. Van-Anh Truong & Robin O. Roundy, 2011. "Multidimensional Approximation Algorithms for Capacity-Expansion Problems," Operations Research, INFORMS, vol. 59(2), pages 313-327, April.
    13. Martínez-Costa, Carme & Mas-Machuca, Marta & Benedito, Ernest & Corominas, Albert, 2014. "A review of mathematical programming models for strategic capacity planning in manufacturing," International Journal of Production Economics, Elsevier, vol. 153(C), pages 66-85.

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