Scheduling a single machine to maximize net present value

This paper investigates scheduling a single productive resource (machine) such that the net present value of the resulting cash flow stream is maximized. The static single machine setting provides an ideal context in which to develop high value scheduling policies. A job release rule (RDE) and a job dispatch rule (MTP) are developed through a marginal cost analysis of the NPV objective, and the composite MTP/RDE scheduling rule is extensively tested against several other benchmark heuristics obtained from the literature. Results indicate that the MTP/RDE rule outperforms the benchmark heuristics by a substantial margin in providing high value schedules. Additionally, sensitivity analysis shows that the MTP/RDE rule is robust in relation to parameter settings and misspecified cost data, suggesting its applicability to real-world production settings.

[1]  Wayne E. Smith.  Various optimizers for single‐stage production , 1956 .

[2]  Thomas E. Morton,et al.  Myopic Heuristics for the Single Machine Weighted Tardiness Problem , 1982 .

[3]  Gary D. Scudder,et al.  Application of the Net Present Value Criterion in Random and Flow Shop Scheduling , 1989 .

[4]  Jeffrey D. Ullman,et al.  NP-Complete Scheduling Problems , 1975, J. Comput. Syst. Sci..

[5]  Candace Aria Yano,et al.  Setting Planned Leadtimes in Serial Production Systems with Tardiness Costs , 1987 .

[6]  Gary D. Scudder,et al.  Sequencing with Earliness and Tardiness Penalties: A Review , 1990, Oper. Res..

[7]  Vincent A. Mabert,et al.  AN EVALUATION OF ORDER RELEASE MECHANISMS IN A JOB-SHOP ENVIRONMENT , 1988 .

[8]  John J. Kankt,et al.  Manufacturing systems with forbidden early order departure , 1984 .

[9]  John J. Kanet,et al.  Toward a better understanding of lead times in MRP systems , 1986 .

[10]  William L. Berry,et al.  Critical Ratio Scheduling: An Experimental Analysis , 1975 .

[11]  Thomas E. Morton,et al.  The single machine early/tardy problem , 1989 .

[12]  A. J. Clewett,et al.  Introduction to sequencing and scheduling , 1974 .

[13]  Samuel Eilon,et al.  Due dates in job shop scheduling , 1976 .

[14]  Norman A. Dudley,et al.  WORK-TIME DISTRIBUTIONS , 1963 .

[15]  Michael H. Rothkopf.  Scheduling with Random Service Times , 1966 .

[16]  Ari P. J. Vepsalainen.  Priority rules for job shops with weighted tardiness costs , 1987 .