C.A. Soman

Combined make-to-order and make-to-stock in a food production system

The research into multi-product production/inventory control systems has mainly assumed one of the two strategies: Make-to-Order (MTO) or Make-to-Stock (MTS). In practice, however, many companies cater to an increasing variety of products with varying logistical demands (e.g. short due dates, specific products) and production characteristics (e.g. capacity usage, setup) to different market segments and so they are moving to more MTO-production. As a consequence they operate under a hybrid MTO-MTS strategy. Important issues arising out of such situations are, for example, which products should be manufactured to stock and which ones on order and, how to allocate capacity among various MTO-MTS products. This paper presents the state-of-the-art literature review of the combined MTO-MTS production situations. A variety of production management issues in the context of food processing companies, where combined MTO-MTS production is quite common, are discussed in details. The authors propose a comprehensive hierarchical planning framework that covers the important production management decisions to serve as a starting point for evaluation and further research on the planning system for MTO-MTS situations.

A basic period approach to the economic lot scheduling problem with shelf life considerations

Almost all the research on the economic lot scheduling problem (ELSP) considering limited shelf life of products has assumed a common cycle approach and an unrealistic assumption of possibility of deliberately reducing the production rate. In many cases, like in food processing industry where limited shelf life for products is common, changing the production rates is not allowed at all because it may result in products with poor quality. In this paper, we allow products to be produced more than once in a cycle and do not allow reducing production rates. We present a modification to the Haesslers basic period procedure to account for the shelf life. Proposed ‘branch-and-bound like’ procedure exploits these extra constraints to efficiently achieve a feasible solution. Numerical examples are presented to show that our approach outperforms common cycle approach with shelf life considerations.