IDEAS home Printed from https://ideas.repec.org/a/spr/annopr/v155y2007i1p51-7810.1007-s10479-007-0213-1.html
   My bibliography  Save this article

Workforce planning at USPS mail processing and distribution centers using stochastic optimization

Author

Listed:
  • Jonathan Bard
  • David Morton
  • Yong Wang

Abstract

Service organizations that operate outside the normal 8-hour day and face wide fluctuations in demand constantly struggle to optimize the size and composition of their workforce. Recent research has shown that improved personnel scheduling methods that take demand uncertainty into account can lead to significant reductions in labor costs. This paper addresses a staff planning and scheduling problem that arises at United States Postal Service (USPS) mail processing & distribution centers (P&DCs) and develops a two-stage stochastic integer program with recourse for the analysis. In the first stage, before the demand is known, the number of full-time and part-time employees is determined for the permanent workforce. In the second stage, the demand is revealed and workers are assigned to specific shifts during the week. When necessary, overtime and casual labor are used to satisfy demand. This paper consists of two parts: (1) the analysis of the demand distribution in light of historical data, and (2) the development and analysis of the stochastic integer programming model. Using weekly demand for a three-year period, we first investigate the possibility that there exists an end-of-month effect, i.e., the week at the end of month has larger volume than the other weeks. We show that the data fail to indicate that this is the case. In the computational phase of the work, three scenarios are considered: high, medium, and low demand. The stochastic optimization problem that results is a large-scale integer program that embodies the full set of contractual agreements and labor rules governing the design of the workforce at a P&DC. The usefulness of the model is evaluated by solving a series of instances constructed from data provided by the Dallas facility. The results indicate that significant savings are likely when the recourse problem is used to help structure the workforce. Copyright Springer Science+Business Media, LLC 2007

Suggested Citation

  • Jonathan Bard & David Morton & Yong Wang, 2007. "Workforce planning at USPS mail processing and distribution centers using stochastic optimization," Annals of Operations Research, Springer, vol. 155(1), pages 51-78, November.
    • Handle: RePEc:spr:annopr:v:155:y:2007:i:1:p:51-78:10.1007/s10479-007-0213-1
    DOI: 10.1007/s10479-007-0213-1
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1007/s10479-007-0213-1
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1007/s10479-007-0213-1?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    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. R. N. Burns & M. W. Carter, 1985. "Work Force Size and Single Shift Schedules with Variable Demands," Management Science, INFORMS, vol. 31(5), pages 599-607, May.
    2. Michael Pinedo, 1983. "Stochastic Scheduling with Release Dates and Due Dates," Operations Research, INFORMS, vol. 31(3), pages 559-572, June.
    3. Turgut Aykin, 1996. "Optimal Shift Scheduling with Multiple Break Windows," Management Science, INFORMS, vol. 42(4), pages 591-602, April.
    4. Ernst, A. T. & Jiang, H. & Krishnamoorthy, M. & Sier, D., 2004. "Staff scheduling and rostering: A review of applications, methods and models," European Journal of Operational Research, Elsevier, vol. 153(1), pages 3-27, February.
    5. Oded Berman & Richard C. Larson & Edieal Pinker, 1997. "Scheduling Workforce and Workflow in a High Volume Factory," Management Science, INFORMS, vol. 43(2), pages 158-172, February.
    6. Willem Klein Haneveld & Maarten van der Vlerk, 1999. "Stochastic integer programming:General models and algorithms," Annals of Operations Research, Springer, vol. 85(0), pages 39-57, January.
    7. Ahmad I. Z. Jarrah & Jonathan F. Bard & Anura H. deSilva, 1994. "Solving Large-Scale Tour Scheduling Problems," Management Science, INFORMS, vol. 40(9), pages 1124-1144, September.
    8. Beaumont, Nicholas, 1997. "Scheduling staff using mixed integer programming," European Journal of Operational Research, Elsevier, vol. 98(3), pages 473-484, May.
    9. Michael J. Brusco & Larry W. Jacobs, 1998. "Personnel Tour Scheduling When Starting-Time Restrictions Are Present," Management Science, INFORMS, vol. 44(4), pages 534-547, April.
    10. Edward P. C. Kao & Maurice Queyranne, 1985. "Budgeting Costs of Nursing in a Hospital," Management Science, INFORMS, vol. 31(5), pages 608-621, May.
    11. Easton, F. F. & Rossin, D. F., 1997. "Overtime schedules for full-time service workers," Omega, Elsevier, vol. 25(3), pages 285-299, June.
    12. J. George Shanthikumar & David D. Yao, 1992. "Multiclass Queueing Systems: Polymatroidal Structure and Optimal Scheduling Control," Operations Research, INFORMS, vol. 40(3-supplem), pages 293-299, June.
    13. K. D. Glazebrook, 1981. "On nonpreemptive strategies in stochastic scheduling," Naval Research Logistics Quarterly, John Wiley & Sons, vol. 28(2), pages 289-300, June.
    14. Stephen E. Bechtold & Larry W. Jacobs, 1990. "Implicit Modeling of Flexible Break Assignments in Optimal Shift Scheduling," Management Science, INFORMS, vol. 36(11), pages 1339-1351, November.
    15. Andrew J. Mason & David M. Ryan & David M. Panton, 1998. "Integrated Simulation, Heuristic and Optimisation Approaches to Staff Scheduling," Operations Research, INFORMS, vol. 46(2), pages 161-175, April.
    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. Douglas Alem & Pedro Munari & Marcos Arenales & Paulo Ferreira, 2010. "On the cutting stock problem under stochastic demand," Annals of Operations Research, Springer, vol. 179(1), pages 169-186, September.
    2. Arpan Rijal & Marco Bijvank & Asvin Goel & René de Koster, 2021. "Workforce Scheduling with Order-Picking Assignments in Distribution Facilities," Transportation Science, INFORMS, vol. 55(3), pages 725-746, May.
    3. Zhenzhen Yan & Sarah Yini Gao & Chung Piaw Teo, 2018. "On the Design of Sparse but Efficient Structures in Operations," Management Science, INFORMS, vol. 64(7), pages 3421-3445, July.
    4. Yiting Xing & Ling Li & Zhuming Bi & Marzena Wilamowska‐Korsak & Li Zhang, 2013. "Operations Research (OR) in Service Industries: A Comprehensive Review," Systems Research and Behavioral Science, Wiley Blackwell, vol. 30(3), pages 300-353, May.
    5. Restrepo, María I. & Gendron, Bernard & Rousseau, Louis-Martin, 2017. "A two-stage stochastic programming approach for multi-activity tour scheduling," European Journal of Operational Research, Elsevier, vol. 262(2), pages 620-635.
    6. Sobhani, A. & Wahab, M.I.M. & Neumann, W.P., 2017. "Incorporating human factors-related performance variation in optimizing a serial system," European Journal of Operational Research, Elsevier, vol. 257(1), pages 69-83.
    7. Van den Bergh, Jorne & Beliën, Jeroen & De Bruecker, Philippe & Demeulemeester, Erik & De Boeck, Liesje, 2013. "Personnel scheduling: A literature review," European Journal of Operational Research, Elsevier, vol. 226(3), pages 367-385.
    8. Kibaek Kim & Sanjay Mehrotra, 2015. "A Two-Stage Stochastic Integer Programming Approach to Integrated Staffing and Scheduling with Application to Nurse Management," Operations Research, INFORMS, vol. 63(6), pages 1431-1451, December.
    9. X Zhang & A Chakravarthy & Q Gu, 2009. "Equipment scheduling problem under disruptions in mail processing and distribution centres," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 60(5), pages 598-610, May.
    10. Ferdinand Kiermaier & Markus Frey & Jonathan F. Bard, 2020. "The flexible break assignment problem for large tour scheduling problems with an application to airport ground handlers," Journal of Scheduling, Springer, vol. 23(2), pages 177-209, April.
    11. Bürgy, Reinhard & Michon-Lacaze, Hélène & Desaulniers, Guy, 2019. "Employee scheduling with short demand perturbations and extensible shifts," Omega, Elsevier, vol. 89(C), pages 177-192.
    12. Douglas S. Altner & Erica K. Mason & Les D. Servi, 2019. "Two-stage stochastic days-off scheduling of multi-skilled analysts with training options," Journal of Combinatorial Optimization, Springer, vol. 38(1), pages 111-129, July.
    13. repec:dau:papers:123456789/4010 is not listed on IDEAS
    14. Jaime Miranda & Pablo A. Rey & Antoine Sauré & Richard Weber, 2018. "Metro Uses a Simulation-Optimization Approach to Improve Fare-Collection Shift Scheduling," Interfaces, INFORMS, vol. 48(6), pages 529-542, November.
    15. Tohidi, Mohammad & Kazemi Zanjani, Masoumeh & Contreras, Ivan, 2021. "A physician planning framework for polyclinics under uncertainty," Omega, Elsevier, vol. 101(C).
    16. Douglas S. Altner & Anthony C. Rojas & Leslie D. Servi, 2018. "A two-stage stochastic program for multi-shift, multi-analyst, workforce optimization with multiple on-call options," Journal of Scheduling, Springer, vol. 21(5), pages 517-531, October.
    17. Dellaert, Nico & Jeunet, Jully & Mincsovics, Gergely, 2011. "Budget allocation for permanent and contingent capacity under stochastic demand," International Journal of Production Economics, Elsevier, vol. 131(1), pages 128-138, May.

    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. L Wan & J F Bard, 2007. "Weekly staff scheduling with workstation group restrictions," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 58(8), pages 1030-1046, August.
    2. Michael J. Brusco & Larry W. Jacobs, 2000. "Optimal Models for Meal-Break and Start-Time Flexibility in Continuous Tour Scheduling," Management Science, INFORMS, vol. 46(12), pages 1630-1641, December.
    3. Jens O. Brunner & Jonathan F. Bard & Jan M. Köhler, 2013. "Bounded flexibility in days‐on and days‐off scheduling," Naval Research Logistics (NRL), John Wiley & Sons, vol. 60(8), pages 678-701, December.
    4. Mark W. Isken & Osman T. Aydas, 2022. "A tactical multi-week implicit tour scheduling model with applications in healthcare," Health Care Management Science, Springer, vol. 25(4), pages 551-573, December.
    5. Arpan Rijal & Marco Bijvank & Asvin Goel & René de Koster, 2021. "Workforce Scheduling with Order-Picking Assignments in Distribution Facilities," Transportation Science, INFORMS, vol. 55(3), pages 725-746, May.
    6. Jens Brunner & Jonathan Bard & Rainer Kolisch, 2009. "Flexible shift scheduling of physicians," Health Care Management Science, Springer, vol. 12(3), pages 285-305, September.
    7. X Zhang & A Chakravarthy & Q Gu, 2009. "Equipment scheduling problem under disruptions in mail processing and distribution centres," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 60(5), pages 598-610, May.
    8. Ferdinand Kiermaier & Markus Frey & Jonathan F. Bard, 2020. "The flexible break assignment problem for large tour scheduling problems with an application to airport ground handlers," Journal of Scheduling, Springer, vol. 23(2), pages 177-209, April.
    9. Jonathan F. Bard & Lin Wan, 2008. "Workforce Design with Movement Restrictions Between Workstation Groups," Manufacturing & Service Operations Management, INFORMS, vol. 10(1), pages 24-42, November.
    10. Giovanni Felici & Claudio Gentile, 2004. "A Polyhedral Approach for the Staff Rostering Problem," Management Science, INFORMS, vol. 50(3), pages 381-393, March.
    11. Lusby, Richard Martin & Range, Troels Martin & Larsen, Jesper, 2015. "A Benders decomposition-based Matheuristic for the Cardinality Constrained Shift Design Problem," Discussion Papers on Economics 9/2015, University of Southern Denmark, Department of Economics.
    12. Lusby, Richard Martin & Range, Troels Martin & Larsen, Jesper, 2016. "A Benders decomposition-based matheuristic for the Cardinality Constrained Shift Design Problem," European Journal of Operational Research, Elsevier, vol. 254(2), pages 385-397.
    13. Hua Ni & Hernán Abeledo, 2007. "A branch-and-price approach for large-scale employee tour scheduling problems," Annals of Operations Research, Springer, vol. 155(1), pages 167-176, November.
    14. Idris Addou & François Soumis, 2007. "Bechtold-Jacobs generalized model for shift scheduling with extraordinary overlap," Annals of Operations Research, Springer, vol. 155(1), pages 177-205, November.
    15. Melanie Erhard, 2021. "Flexible staffing of physicians with column generation," Flexible Services and Manufacturing Journal, Springer, vol. 33(1), pages 212-252, March.
    16. Haase, Knut, 1999. "Retail business staff scheduling under complex labor relations," Manuskripte aus den Instituten für Betriebswirtschaftslehre der Universität Kiel 511, Christian-Albrechts-Universität zu Kiel, Institut für Betriebswirtschaftslehre.
    17. Aykin, Turgut, 2000. "A comparative evaluation of modeling approaches to the labor shift scheduling problem," European Journal of Operational Research, Elsevier, vol. 125(2), pages 381-397, September.
    18. Brusco, Michael J. & Johns, Tony R., 1996. "A sequential integer programming method for discontinuous labor tour scheduling," European Journal of Operational Research, Elsevier, vol. 95(3), pages 537-548, December.
    19. Banu Sungur & Cemal Özgüven & Yasemin Kariper, 2017. "Shift scheduling with break windows, ideal break periods, and ideal waiting times," Flexible Services and Manufacturing Journal, Springer, vol. 29(2), pages 203-222, June.
    20. Robbins, Thomas R. & Harrison, Terry P., 2010. "A stochastic programming model for scheduling call centers with global Service Level Agreements," European Journal of Operational Research, Elsevier, vol. 207(3), pages 1608-1619, December.

    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:spr:annopr:v:155:y:2007:i:1:p:51-78:10.1007/s10479-007-0213-1. 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: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    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.