Probabilistic Piecewise-Objective Optimization Model for Integrated Supplier Selection and Production Planning Problems Involving Discounts and Probabilistic Parameters: Single Period Case

Sutrisno Sutrisno; Widowati Wıdowatı; Robertus Heri Soelistyo Utomo

doi:10.55549/epstem.1371794

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Probabilistic Piecewise-Objective Optimization Model for Integrated Supplier Selection and Production Planning Problems Involving Discounts and Probabilistic Parameters: Single Period Case

Year 2023, Volume: 23, 442 - 451, 30.09.2023

Sutrisno Sutrisno , Widowati Wıdowatı Robertus Heri Soelistyo Utomo

https://doi.org/10.55549/epstem.1371794

Abstract

In manufacturing and retail industries, supplier selection problems deal with allocating the optimal raw material amount that should be purchased to each supplier such that the procurement cost is minimal. Meanwhile, production planning problems deal with maximizing the product amount to be produced. Decision-makers need to take optimal decisions for those problem to gain the maximal revenue. In this paper, a novel mathematical model in the class of probabilistic piecewise programming is proposed as a decision-making support that can be used to find the optimal decision in solving both integrated supplier selection and production planning problems involving discounts and probabilistic parameters. The objective is to gain the optimal performance of the supply chain, i.e., maximizing the profit from the production activity. The model covers multi-raw material, multi-supplier, multi-product, and multi-buyer situations. Numerical experiments were conducted to evaluate the proposed model and to illustrate how the optimal decision is taken. Results showed that the proposed decision-making support successfully solved the problem and provided the optimal decision for the given problem. Therefore, the proposed model can be implemented by decision-makers/managers in industries.

Keywords

Decision-making support , Discounts , Order-allocation , Piecewise-objective , Probabilistic optimization , Production planning , Supplier selection

References

Adrio, G., García-Villoria, A., Juanpera, M., & Pastor, R. (2023). MILP model for the mid-term production planning in a chemical company with non-constant consumption of raw materials. an industrial application. Computers & Chemical Engineering, 177, 108361.
Alegoz, M., & Yapicioglu, H. (2019). Supplier selection and order allocation decisions under quantity discount and fast service options. Sustainable Production and Consumption, 18, 179–189.
Ali, Md. R., Nipu, S. Md. A., & Khan, S. A. (2023). A decision support system for classifying supplier selection criteria using machine learning and random forest approach. Decision Analytics Journal, 7, 100238.

Year 2023, Volume: 23, 442 - 451, 30.09.2023

Sutrisno Sutrisno , Widowati Wıdowatı Robertus Heri Soelistyo Utomo

https://doi.org/10.55549/epstem.1371794

Abstract

References

Adrio, G., García-Villoria, A., Juanpera, M., & Pastor, R. (2023). MILP model for the mid-term production planning in a chemical company with non-constant consumption of raw materials. an industrial application. Computers & Chemical Engineering, 177, 108361.
Alegoz, M., & Yapicioglu, H. (2019). Supplier selection and order allocation decisions under quantity discount and fast service options. Sustainable Production and Consumption, 18, 179–189.
Ali, Md. R., Nipu, S. Md. A., & Khan, S. A. (2023). A decision support system for classifying supplier selection criteria using machine learning and random forest approach. Decision Analytics Journal, 7, 100238.

There are 3 citations in total.

Details

Primary Language	English
Subjects	Environmental and Sustainable Processes
Journal Section	Articles
Authors	Sutrisno Sutrisno Widowati Wıdowatı Robertus Heri Soelistyo Utomo
Early Pub Date	October 5, 2023
Publication Date	September 30, 2023
Published in Issue	Year 2023 Volume: 23

Cite

APA	Sutrisno, S., Wıdowatı, W., & Utomo, R. H. S. (2023). Probabilistic Piecewise-Objective Optimization Model for Integrated Supplier Selection and Production Planning Problems Involving Discounts and Probabilistic Parameters: Single Period Case. The Eurasia Proceedings of Science Technology Engineering and Mathematics, 23, 442-451. https://doi.org/10.55549/epstem.1371794