A resilience optimization approach for workforce-inventory control dynamics under uncertainty

The presence of uncertainties in manufacturing systems and supply chains can cause undesirable behavior. Failure to account for these in the design phase can further impair the capability of systems to respond to changes effectively. In this work, we consider a dynamic workforce-inventory control problem wherein inventory planning, production releases, and workforce hiring decisions need to be made. The objective is to develop planning rules to achieve important requirements related to dynamic transient behavior when system parameters are imprecisely known. To this end, we propose a resilience optimization model for the problem and develop a novel local search procedure that combines the strengths of recent developments in robust optimization technology and small signal stability analysis of dynamic systems. A numerical case study of the problem demonstrates significant improvements of the proposed solution in controlling fluctuations and high variability found in the system’s inventory, work-in-process, and workforce levels. Overall, the proposed model is shown to be computationally efficient and effective in hedging against model uncertainties.

[1]  I. Mitroff,et al.  Preparing for evil. , 2003, Harvard business review.

[2]  Benjamin C. Kuo,et al.  AUTOMATIC CONTROL SYSTEMS , 1962, Universum:Technical sciences.

[3]  A. Nemirovskii.  Several NP-hard problems arising in robust stability analysis , 1993 .

[4]  Denis Royston Towill,et al.  Dynamic analysis of an inventory and order based production control system , 1982 .

[5]  Franco Blanchini,et al.  A Network Design Problem for a Distribution System with Uncertain Demands , 1997, SIAM J. Optim..

[6]  A Ben Tal,et al.  ROBUST SOLUTIONS TO UNCERTAIN PROGRAMS , 1999 .

[7]  Vincent D. Blondel,et al.  Probabilistic solutions to some NP-hard matrix problems , 2001, Autom..

[8]  S. M. Shahidehpour,et al.  Effect of Small Random Perturbations on Power Systems Dynamics and Its Reliability Evaluation , 1989, IEEE Power Engineering Review.

[9]  Melvyn Sim,et al.  Robust Optimization Made Easy with ROME , 2011, Oper. Res..

[10]  Christos D. Tarantilis,et al.  Dynamic modeling and control of supply chain systems: A review , 2008, Comput. Oper. Res..

[11]  Herbert J. Vassian.  Application of Discrete Variable Servo Theory to Inventory Control , 1955, Oper. Res..

[12]  Arkadi Nemirovski,et al.  Robust solutions of uncertain linear programs , 1999, Oper. Res. Lett..

[13]  B. Porter,et al.  Modal control of production-inventory systems using piecewise-constant control policies , 1974 .

[14]  Albert Jones,et al.  Toward modeling and simulation of critical national infrastructure interdependencies , 2005 .

[15]  H. Igor Ansoff,et al.  An Appreciation of Industrial Dynamics , 1968 .

[16]  W. L. Brogan,et al.  Modelling and optimal control of a production process , 1971 .

[17]  D. Sterman,et al.  Misperceptions of Feedback in a Dynamic Decision Making Experiment , 1989 .

[18]  Rogelio Oliva,et al.  A comprehensive analytical approach for policy analysis of system dynamics models , 2010, Eur. J. Oper. Res..

[19]  Mir Saman Pishvaee,et al.  A robust optimization approach to closed-loop supply chain network design under uncertainty , 2011 .

[20]  Melvyn Sim,et al.  The Price of Robustness , 2004, Oper. Res..

[21]  Dimitris Bertsimas,et al.  A Robust Optimization Approach to Inventory Theory , 2006, Oper. Res..

[22]  Jane Edghill,et al.  Industrial case-study on the dynamics and sensitivity of a close-coupled production-distribution system† , 1988 .

[23]  Allen L. Soyster,et al.  Technical Note - Convex Programming with Set-Inclusive Constraints and Applications to Inexact Linear Programming , 1973, Oper. Res..

[24]  John D. Sterman,et al.  Control theory heuristics for improving the behavior of economic models , 1989 .

[25]  Zhao Yang Dong,et al.  Power System Sensitivity Analysis for Probabilistic Small Signal Stability Assessment in a Deregulated Environment , 2005 .

[26]  H. Simon,et al.  On the Application of Servomechanism Theory in the Study of Production Control , 1952 .

[27]  M. Ortega,et al.  Control theory applications to the production–inventory problem: a review , 2004 .