Production planning of a furniture manufacturing company with random demand and production capacity using stochastic programming

PLoS One. 2021 Jun 14;16(6):e0252801. doi: 10.1371/journal.pone.0252801. eCollection 2021.

Abstract

In this article two multi-stage stochastic linear programming models are developed, one applying the stochastic programming solver integrated by Lingo 17.0 optimization software that utilizes an approximation using an identical conditional sampling and Latin-hyper-square techniques to reduce the sample variance, associating the probability distributions to normal distributions with defined mean and standard deviation; and a second proposed model with a discrete distribution with 3 values and their respective probabilities of occurrence. In both cases, a scenario tree is generated. The models developed are applied to an aggregate production plan (APP) for a furniture manufacturing company located in the state of Hidalgo, Mexico, which has important clients throughout the country. Production capacity and demand are defined as random variables of the model. The main purpose of this research is to determine a feasible solution to the aggregate production plan in a reasonable computational time. The developed models were compared and analyzed. Moreover, this work was complemented with a sensitivity analysis; varying the percentage of service level, also, varying the stochastic parameters (mean and standard deviation) to test how these variations impact in the solution and decision variables.

MeSH terms

  • Algorithms*
  • Commerce / methods*
  • Commerce / statistics & numerical data
  • Computer Simulation
  • Humans
  • Interior Design and Furnishings / methods*
  • Interior Design and Furnishings / statistics & numerical data
  • Mexico
  • Models, Theoretical*
  • Reproducibility of Results
  • Stochastic Processes*

Associated data

  • figshare/10.6084/m9.figshare.14444609.v1
  • figshare/10.6084/m9.figshare.14450430

Grants and funding

The author(s) received no specific funding for this work.