IDEAS home Printed from https://ideas.repec.org/a/eee/ejores/v198y2009i1p121-128.html
   My bibliography  Save this article

Development of a new approach for deterministic supply chain network design

Author

Listed:
  • Mohammadi Bidhandi, Hadi
  • Mohd. Yusuff, Rosnah
  • Megat Ahmad, Megat Mohamad Hamdan
  • Abu Bakar, Mohd Rizam

Abstract

This paper proposes a mixed integer linear programming model and solution algorithm for solving supply chain network design problems in deterministic, multi-commodity, single-period contexts. The strategic level of supply chain planning and tactical level planning of supply chain are aggregated to propose an integrated model. The model integrates location and capacity choices for suppliers, plants and warehouses selection, product range assignment and production flows. The open-or-close decisions for the facilities are binary decision variables and the production and transportation flow decisions are continuous decision variables. Consequently, this problem is a binary mixed integer linear programming problem. In this paper, a modified version of Benders' decomposition is proposed to solve the model. The most difficulty associated with the Benders' decomposition is the solution of master problem, as in many real-life problems the model will be NP-hard and very time consuming. In the proposed procedure, the master problem will be developed using the surrogate constraints. We show that the main constraints of the master problem can be replaced by the strongest surrogate constraint. The generated problem with the strongest surrogate constraint is a valid relaxation of the main problem. Furthermore, a near-optimal initial solution is generated for a reduction in the number of iterations.

Suggested Citation

  • Mohammadi Bidhandi, Hadi & Mohd. Yusuff, Rosnah & Megat Ahmad, Megat Mohamad Hamdan & Abu Bakar, Mohd Rizam, 2009. "Development of a new approach for deterministic supply chain network design," European Journal of Operational Research, Elsevier, vol. 198(1), pages 121-128, October.
    • Handle: RePEc:eee:ejores:v:198:y:2009:i:1:p:121-128
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0377-2217(08)00673-5
    Download Restriction: Full text for ScienceDirect subscribers only
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Jean-François Cordeau & Federico Pasin & Marius Solomon, 2006. "An integrated model for logistics network design," Annals of Operations Research, Springer, vol. 144(1), pages 59-82, April.
    2. Vidal, Carlos J. & Goetschalckx, Marc, 1997. "Strategic production-distribution models: A critical review with emphasis on global supply chain models," European Journal of Operational Research, Elsevier, vol. 98(1), pages 1-18, April.
    3. Arthur M. Geoffrion & Richard F. Powers, 1995. "Twenty Years of Strategic Distribution System Design: An Evolutionary Perspective," Interfaces, INFORMS, vol. 25(5), pages 105-127, October.
    4. Fred Glover, 1975. "Surrogate Constraint Duality in Mathematical Programming," Operations Research, INFORMS, vol. 23(3), pages 434-451, June.
    5. Sabri, Ehap H. & Beamon, Benita M., 2000. "A multi-objective approach to simultaneous strategic and operational planning in supply chain design," Omega, Elsevier, vol. 28(5), pages 581-598, October.
    6. A. M. Geoffrion & G. W. Graves, 1974. "Multicommodity Distribution System Design by Benders Decomposition," Management Science, INFORMS, vol. 20(5), pages 822-844, January.
    7. Cohen, Morris A. & Moon, Sangwon, 1991. "An integrated plant loading model with economies of scale and scope," European Journal of Operational Research, Elsevier, vol. 50(3), pages 266-279, February.
    8. Goetschalckx, Marc & Vidal, Carlos J. & Dogan, Koray, 2002. "Modeling and design of global logistics systems: A review of integrated strategic and tactical models and design algorithms," European Journal of Operational Research, Elsevier, vol. 143(1), pages 1-18, November.
    9. Beamon, Benita M., 1998. "Supply chain design and analysis:: Models and methods," International Journal of Production Economics, Elsevier, vol. 55(3), pages 281-294, August.
    10. A. M. Geoffrion, 1969. "An Improved Implicit Enumeration Approach for Integer Programming," Operations Research, INFORMS, vol. 17(3), pages 437-454, June.
    11. Egon Balas, 1967. "Discrete Programming by the Filter Method," Operations Research, INFORMS, vol. 15(5), pages 915-957, October.
    12. Thomas, Douglas J. & Griffin, Paul M., 1996. "Coordinated supply chain management," European Journal of Operational Research, Elsevier, vol. 94(1), pages 1-15, October.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Juan Yu & Mi Gan & Shaoquan Ni & Dingjun Chen, 2018. "Multi-objective models and real case study for dual-channel FAP supply chain network design with fuzzy information," Journal of Intelligent Manufacturing, Springer, vol. 29(2), pages 389-403, February.
    2. Nayeri, Sina & Sazvar, Zeinab & Heydari, Jafar, 2022. "A global-responsive supply chain considering sustainability and resiliency: Application in the medical devices industry," Socio-Economic Planning Sciences, Elsevier, vol. 82(PB).
    3. Wang, Gang & Gunasekaran, Angappa & Ngai, Eric W.T. & Papadopoulos, Thanos, 2016. "Big data analytics in logistics and supply chain management: Certain investigations for research and applications," International Journal of Production Economics, Elsevier, vol. 176(C), pages 98-110.
    4. Sahling, Florian & Kayser, Ariane, 2016. "Strategic supply network planning with vendor selection under consideration of risk and demand uncertainty," Omega, Elsevier, vol. 59(PB), pages 201-214.
    5. Longinidis, Pantelis & Georgiadis, Michael C., 2014. "Integration of sale and leaseback in the optimal design of supply chain networks," Omega, Elsevier, vol. 47(C), pages 73-89.
    6. Alidaee, Bahram, 2014. "Zero duality gap in surrogate constraint optimization: A concise review of models," European Journal of Operational Research, Elsevier, vol. 232(2), pages 241-248.
    7. Matt Bassett & Leslie Gardner, 2013. "Designing optimal global supply chains at Dow AgroSciences," Annals of Operations Research, Springer, vol. 203(1), pages 187-216, March.
    8. Morteza Lalmazloumian & Kuan Yew Wong & Kannan Govindan & Devika Kannan, 2016. "A robust optimization model for agile and build-to-order supply chain planning under uncertainties," Annals of Operations Research, Springer, vol. 240(2), pages 435-470, May.
    9. Sina Abbasi & Ilias Vlachos & Ali Samadzadeh & Shayan Etemadifar & Mohamad Afshar & Mohsen Amra, 2024. "Modelling a Logistics and Financial Supply Chain Network during the COVID-19 Era," Logistics, MDPI, vol. 8(1), pages 1-21, March.
    10. Khatami, Maryam & Mahootchi, Masoud & Farahani, Reza Zanjirani, 2015. "Benders’ decomposition for concurrent redesign of forward and closed-loop supply chain network with demand and return uncertainties," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 79(C), pages 1-21.
    11. Blossey, Gregor & Hahn, Gerd J. & Koberstein, Achim, 2022. "Planning pharmaceutical manufacturing networks in the light of uncertain production approval times," International Journal of Production Economics, Elsevier, vol. 244(C).
    12. Kiya, Farhad & Davoudpour, Hamid, 2012. "Stochastic programming approach to re-designing a warehouse network under uncertainty," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 48(5), pages 919-936.
    13. Jann Michael Weinand & Kenneth Sorensen & Pablo San Segundo & Max Kleinebrahm & Russell McKenna, 2020. "Research trends in combinatorial optimisation," Papers 2012.01294, arXiv.org.
    14. Mariel, Katharina & Minner, Stefan, 2017. "Benders decomposition for a strategic network design problem under NAFTA local content requirements," Omega, Elsevier, vol. 68(C), pages 62-75.
    15. Jahani, Hamed & Abbasi, Babak & Sheu, Jiuh-Biing & Klibi, Walid, 2024. "Supply chain network design with financial considerations: A comprehensive review," European Journal of Operational Research, Elsevier, vol. 312(3), pages 799-839.
    16. Muhamad Deni Johansyah & Sundarapandian Vaidyanathan & Aceng Sambas & Khaled Benkouider & Seyed Mohammad Hamidzadeh & Monika Hidayanti, 2024. "Dynamical Analysis and Sliding Mode Controller for the New 4D Chaotic Supply Chain Model Based on the Product Received by the Customer," Mathematics, MDPI, vol. 12(13), pages 1-21, June.
    17. Sonia Mahjoub & Jean-Claude Hennet, 2014. "Manufacturers’ Coalition under a Price Elastic Market - a Quadratic Production Game Approach," Post-Print hal-01479690, HAL.
    18. Yu-Chung Tsao & Qinhong Zhang & Tsung-Hui Chen, 2016. "Multi-item distribution network design problems under volume discount on transportation cost," International Journal of Production Research, Taylor & Francis Journals, vol. 54(2), pages 426-443, January.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Eskigun, Erdem & Uzsoy, Reha & Preckel, Paul V. & Beaujon, George & Krishnan, Subramanian & Tew, Jeffrey D., 2005. "Outbound supply chain network design with mode selection, lead times and capacitated vehicle distribution centers," European Journal of Operational Research, Elsevier, vol. 165(1), pages 182-206, August.
    2. Meijboom, Bert & Obel, Børge, 2007. "Tactical coordination in a multi-location and multi-stage operations structure: A model and a pharmaceutical company case," Omega, Elsevier, vol. 35(3), pages 258-273, June.
    3. Umar Muhammad Modibbo & Srikant Gupta & Aquil Ahmed & Irfan Ali, 2024. "An integrated multi-objective multi-product inventory managed production planning problem under uncertain environment," Annals of Operations Research, Springer, vol. 339(3), pages 1679-1723, August.
    4. García Cáceres, Rafael Guillermo & Aráoz Durand, Julián Arturo & Gómez, Fernando Palacios, 2009. "Integral analysis method - IAM," European Journal of Operational Research, Elsevier, vol. 192(3), pages 891-903, February.
    5. Wang, Juite & Shu, Yun-Feng, 2007. "A possibilistic decision model for new product supply chain design," European Journal of Operational Research, Elsevier, vol. 177(2), pages 1044-1061, March.
    6. Schneeweiss, Christoph & Zimmer, Kirstin, 2004. "Hierarchical coordination mechanisms within the supply chain," European Journal of Operational Research, Elsevier, vol. 153(3), pages 687-703, March.
    7. Ahumada, Omar & Villalobos, J. Rene, 2009. "Application of planning models in the agri-food supply chain: A review," European Journal of Operational Research, Elsevier, vol. 196(1), pages 1-20, July.
    8. Erdem Eskigun & Reha Uzsoy & Paul V. Preckel & George Beaujon & Subramanian Krishnan & Jeffrey D. Tew, 2007. "Outbound supply chain network design with mode selection and lead time considerations," Naval Research Logistics (NRL), John Wiley & Sons, vol. 54(3), pages 282-300, April.
    9. Keskin, Burcu B. & Uster, Halit, 2007. "Meta-heuristic approaches with memory and evolution for a multi-product production/distribution system design problem," European Journal of Operational Research, Elsevier, vol. 182(2), pages 663-682, October.
    10. Melo, M.T. & Nickel, S. & Saldanha-da-Gama, F., 2009. "Facility location and supply chain management - A review," European Journal of Operational Research, Elsevier, vol. 196(2), pages 401-412, July.
    11. Mula, Josefa & Peidro, David & Díaz-Madroñero, Manuel & Vicens, Eduardo, 2010. "Mathematical programming models for supply chain production and transport planning," European Journal of Operational Research, Elsevier, vol. 204(3), pages 377-390, August.
    12. Vila, Didier & Martel, Alain & Beauregard, Robert, 2006. "Designing logistics networks in divergent process industries: A methodology and its application to the lumber industry," International Journal of Production Economics, Elsevier, vol. 102(2), pages 358-378, August.
    13. Klose, Andreas & Drexl, Andreas, 2005. "Facility location models for distribution system design," European Journal of Operational Research, Elsevier, vol. 162(1), pages 4-29, April.
    14. Tiwari, M.K. & Raghavendra, N. & Agrawal, Shubham & Goyal, S.K., 2010. "A Hybrid Taguchi-Immune approach to optimize an integrated supply chain design problem with multiple shipping," European Journal of Operational Research, Elsevier, vol. 203(1), pages 95-106, May.
    15. Hoai An, Le Thi & Phuc, Nguyen Trong & Tao, Pham Dinh, 2007. "A continuous DC programming approach to the strategic supply chain design problem from qualified partner set," European Journal of Operational Research, Elsevier, vol. 183(3), pages 1001-1012, December.
    16. Salema, Maria Isabel Gomes & Barbosa-Povoa, Ana Paula & Novais, Augusto Q., 2010. "Simultaneous design and planning of supply chains with reverse flows: A generic modelling framework," European Journal of Operational Research, Elsevier, vol. 203(2), pages 336-349, June.
    17. Goetschalckx, Marc & Vidal, Carlos J. & Dogan, Koray, 2002. "Modeling and design of global logistics systems: A review of integrated strategic and tactical models and design algorithms," European Journal of Operational Research, Elsevier, vol. 143(1), pages 1-18, November.
    18. Olivares-Benitez, Elias & Ríos-Mercado, Roger Z. & González-Velarde, José Luis, 2013. "A metaheuristic algorithm to solve the selection of transportation channels in supply chain design," International Journal of Production Economics, Elsevier, vol. 145(1), pages 161-172.
    19. Samir Elhedhli & Jean-Louis Goffin, 2005. "Efficient Production-Distribution System Design," Management Science, INFORMS, vol. 51(7), pages 1151-1164, July.
    20. Hsu, Chaug-Ing & Li, Hui-Chieh, 2009. "An integrated plant capacity and production planning model for high-tech manufacturing firms with economies of scale," International Journal of Production Economics, Elsevier, vol. 118(2), pages 486-500, April.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:ejores:v:198:y:2009:i:1:p:121-128. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/eor .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.