Co-Production of Substitutable Products

• Main Authors: BITRAN, G., LEONG, Thin Yin
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 1995
• Subjects: Computer Sciences; Operations and Supply Chain Management
• Online Access: https://ink.library.smu.edu.sg/sis_research/164; http://dx.doi.org/10.1080/09537289508930249
• Institution: Singapore Management University

Co-production occurs when a production run produces, simultaneously, more than one type of product. In this paper, we consider co-production planning problems with stochastic yields, multiple processes, limited capacity and nontransitive product demand substitution. We show that these problems can be transformed to a structure where the demand substitutions are transitive. We address the decisions of how to select processes, to determine production quantities for each process and to allocate inventory to product demands. Finally, we provide simple heuristics and report on computational experiments done on randomly generated test cases.