TY - CHAP
T1 - Replenishment planning for stochastic inventory systems with shortage cost
AU - Rossi, Roberto
AU - Armagan Tarim, S.
AU - Hnich, Brahim
AU - Prestwich, Steven
PY - 2007
Y1 - 2007
N2 - One of the most important policies adopted in inventory control is the (R,S) policy (also known as the "replenishment cycle" policy). Under the non-stationary demand assumption the (R,S) policy takes the form (R n,Sn) where Rn denotes the length of the n th replenishment cycle, and Sn the corresponding order-up-to-level. Such a policy provides an effective means of damping planning instability and coping with demand uncertainty. In this paper we develop a CP approach able to compute optimal (Rn,Sn) policy parameters under stochastic demand, ordering, holding and shortage costs. The convexity of the cost-function is exploited during the search to compute bounds. We use the optimal solutions to analyze the quality of the solutions provided by an approximate MIP approach that exploits a piecewise linear approximation for the cost function.
AB - One of the most important policies adopted in inventory control is the (R,S) policy (also known as the "replenishment cycle" policy). Under the non-stationary demand assumption the (R,S) policy takes the form (R n,Sn) where Rn denotes the length of the n th replenishment cycle, and Sn the corresponding order-up-to-level. Such a policy provides an effective means of damping planning instability and coping with demand uncertainty. In this paper we develop a CP approach able to compute optimal (Rn,Sn) policy parameters under stochastic demand, ordering, holding and shortage costs. The convexity of the cost-function is exploited during the search to compute bounds. We use the optimal solutions to analyze the quality of the solutions provided by an approximate MIP approach that exploits a piecewise linear approximation for the cost function.
UR - https://www.scopus.com/pages/publications/37149045708
U2 - 10.1007/978-3-540-72397-4_17
DO - 10.1007/978-3-540-72397-4_17
M3 - Chapter
AN - SCOPUS:37149045708
SN - 354072396X
SN - 9783540723967
T3 - Lecture Notes in Computer Science (including subseries Lecture Notes in Artificial Intelligence and Lecture Notes in Bioinformatics)
SP - 229
EP - 243
BT - Integration of AI and OR Techniques in Constraint Programming for Combinatorial Optimization Problems - 4th International Conference, CPAIOR 2007, Proceedings
PB - Springer Verlag
T2 - 4th International Conference on Integration of Artificial Intelligence, Constraint Programming, and Operations Research Techniques for Combinatorial Optimization Problems, CPAIOR 2007
Y2 - 23 May 2007 through 26 May 2007
ER -