A hybrid solution to collaborative decision-making in a decentralized supply-chain

Authors:
Steven Y. P. Lu;Henry Y. K. Lau;Cedric K. F. Yiu
Affiliations:
Department of Industrial and Manufacturing Systems Engineering, The University of Hong Kong, Pokfulam Road, Hong Kong, China;Department of Industrial and Manufacturing Systems Engineering, The University of Hong Kong, Pokfulam Road, Hong Kong, China;Department of Applied Mathematics, The Hong Kong Polytechnic University, Hunghom, Kowloon, Hong Kong, China
Venue:
Journal of Engineering and Technology Management
Year:
2012

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Abstract

This paper considers a decentralized supply chain, where multiple independent manufacturing facilities manage some capital-intensive equipments or resources shared among them. In particular, these manufacturing facilities operate somewhat in isolation to serve their own customers, but coordinate closely with each other to ensure the shared resources are effectively utilized. Such cross-facility capacity management problems are common in high-tech industries, they are typical examples of collaborative decision-making in supply chain integration, and are critical to create a competitive edge in a more interconnected business environment. In this paper, a hybrid algorithm that integrates Lagrangian relaxation and immunity-inspired coordination scheme, known as LR-ICI, is proposed and investigated by extensive numerical experiments, and is shown to be competitive compared to similar algorithms.