A novel optimization model for the simultaneous batching, production and distribution scheduling in process industries

Abstract

Traditionally, the short-term production and distribution activities have been addressed with a decoupled and sequential methodology. Although this approach simplifies the problem, there are several environments in which this methodology generates inefficiencies. Consequently integrated management of these activities is essential. This paper presents a novel mixed-integer linear optimization model to manage production and distribution decisions simultaneously at minimum operating cost. An effective strategy is proposed where all feasible routes that vehicles can travel are generated beforehand. This approach is very valuable mainly for two reasons: infeasible routes are not considered in the problem formulation (reduction of the search space) and several important decisions are made simultaneously when a route is selected, such as the allocation and sequencing of the customers visited in each route. The performance of the proposed model is compared against a first approach that, unlike the current formulation, presents difficulties in large problems.