Synchronized scheduling of production and outbound shipping using bilevel-based simulated annealing algorithm

Abstract In general, different divisions even in a same company may make scheduling decisions irrespective of the overall benefit of the company. It is practically impossible to carry out the integrated optimization, and the sequential optimization results in isolated solutions within the divisions often leads to inferior overall solutions. In this study, a novel bilevel approach is proposed for joint synchronized production and shipping scheduling, considering production division as the leader and shipping division as the follower. A bilevel-based simulating annealing (SA) algorithm is proposed as the solution algorithm. Specifically, first, the production division prepares a tentative production schedule obtained by the SA. Based on the tentative schedule, shipping scheduling is addressed by an effective heuristic named Earliest Completion Machine. An inner SA is also presented for shipping scheduling to generate good quality shipping schedules. The tentative schedule is iteratively updated until the stopping criterion is satisfied. The effectiveness and efficiency of the proposed approach were verified via comparison with the traditional sequential and integrated approaches. Furthermore, the sensitivity analysis results indicate that shipping capacity has a considerable effect on the overall makespan. The allocation of the fixed shipping capacity onto blocks was also investigated, indicating that the large more strategy outperforms the average allocation and the large less strategies.