Method for considering hierarchical preemptive demand priorities in a supply chain optimization model

• US 7,966,214 B2
• Filed: 01/29/2004
• Issued: 06/21/2011
• Est. Priority Date: 01/29/2004
• Status: Expired due to Fees

• Current Assignee: International Business Machines Corporation
• Original Assignee: International Business Machines Corporation
• Inventors: Milne, Robert J., Forrest, John J., Denton, Brian T.
• Primary Examiner(s): Jeanty; Romain
• Assistant Examiner(s): Fleischer; Mark A
• Application Number:
  US10/707,979
• Publication Number:
  US 20050171828A1
• Time in Patent Office: 2,700 Days
• Field of Search: 705/8
• US Class Current: 705/7.12
• CPC Class Codes: G06Q 10/0631 Resource planning, allocation, distributing or scheduling for enterprises or organisations
• CPC Class Codes: G06Q 10/06312 Adjustment or analysis of established resource schedule, e.g. resource or task levelling, or dynamic rescheduling
• CPC Class Codes: G06Q 10/06314 Calendaring for a resource
• CPC Class Codes: G06Q 10/06315 Needs-based resource requirements planning or analysis
• CPC Class Codes: G06Q 10/06375 Prediction of business process outcome or impact based on a proposed change
• CPC Class Codes: G06Q 10/087 Inventory or stock management, e.g. order filling, procurement or balancing against orders

Abstract

The invention comprises a method for achieving consideration of preemptive priorities within a supply chain optimization model. More specifically, the invention provides a method of allocating resources to a hierarchy of demand priorities in a linear programming production planning system. In particular, the invention aggregates the demand priorities into different priority groups and allocates the resources to the highest priority group of demand priorities using a first linear programming model. Next, the invention allocates remaining resources to the next highest priority group of demand priorities using a second linear programming model. The second linear programming model uses results from the first linear programming model. The invention continues this process by iteratively repeating the process of allocating remaining resources to the remaining groups of demand priorities, in order of priority. The system and method were employed to integrate the consideration of preemptive prioritization of customer demands with an advanced planning system for optimizing established planning objectives (e.g. customer service, short lead times, low inventory, and prioritized allocation of supply and capacity) to compute a feasible production plan for the division.

Claims

1. A computer-implemented method for determining a production plan comprising:

receiving customer demands for resources from different customers;

rank ordering, by a computing device, said customer demands to create prioritized customer demands;

aggregating, by said computing device, said prioritized customer demands into a plurality of priority groups based on said rank ordering of said customer demands;

optimizing, by said computing device, a first mathematical linear programming model based on processing a highest priority group of said plurality of priority groups;

assigning, by said computing device, a portion of said resources to said highest priority group of said plurality of priority groups based on said optimizing said first mathematical linear programming model;

determining, by said computing device, each iterative solution for remaining ones of said plurality of priority groups in order of said rank ordering of said customer demands using results from a previous mathematical linear programming model solution;

assigning, by said computing device, portions of remaining resources to a next highest priority group of said plurality of priority groups based on said determining each iterative solution;

outputting, by said computing device, said production plan based on said assigning resources;

independently determining, by said computing device, backorder costs penalties for each of said plurality of priority groups using said computing device; and

assigning, by said computing device, by each successive mathematical linear programming model, a range of said backorder costs within a priority group of said plurality of priority groups to which resources are currently being assigned.

2. The method of claim 1, wherein said prioritized customer demands are hierarchical and comprises two or more levels of hierarchy.

3. The method of claim 1, wherein said mathematical linear programs solved in each iteration use the solution to the previous mathematical linear program as a starting solution.

4. The method of claim 1, further comprising adding constraints to said mathematical linear programming models at each iteration ensure a feasible starting solution for re-optimizing said mathematical linear programming models.

5. The method of claim 1, wherein said method uses a different mathematical linear program for each iteration.

6. The method of claim 1, wherein said assigning process solves said mathematical linear programs for higher prioritized customer demands before solving said mathematical linear programs for lower prioritized customer demands.

7. A computer-implemented method of assigning resources to a hierarchy of prioritized customer demands in a linear programming production planning system for determining a production plan, said method comprising:

receiving customer demands for resources from different customers;

rank ordering, by a computing device, said customer demands to create prioritized customer demands;

aggregating, by said computing device, said prioritized customer demands into a plurality of priority groups based on said rank ordering of said customer demands;

optimizing, by said computing device, a first mathematical linear programming model based on processing a highest priority group of said plurality of priority groups;

assigning, by said computing device, a portion of said resources to a highest priority group of said plurality of priority groups based on said optimizing said first linear programming model;

assigning, by said computing device, portions of remaining resources to a next highest priority group of said plurality of priority groups using a second mathematical linear programming model, wherein said second mathematical linear programming model uses results from said first mathematical linear programming model;

repeating said process of assigning portions of remaining resources, by said computing device, to remaining groups of said plurality of priority groups in order of priority, wherein each subsequent mathematical linear programming model uses results from a previous linear programming model; and

outputting, by said computing device, a production plan based said assigning resources,

wherein during said assigning processes, each mathematical linear programming model assigns a range of backorder costs within the priority group of said plurality of priority groups to which the resources are currently being assigned.

8. The method in claim 7, wherein when repeating said process of assigning remaining resources, said method uses a different linear programming model for each repetition of said process of assigning remaining resources.

9. The method in claim 8, wherein each different linear programming model uses a program solution of the previous linear programming model.

10. The method in claim 7, wherein during said assigning processes, each linear programming model fixes variables associated with priority groups that have a lower priority than the priority group to which the resources are currently being assigned.

11. The method in claim 7, further comprising dividing said priority groups into different sub-priority tiers.

12. The method in claim 11, wherein said sub-priority tiers can be processed simultaneously.

13. A computer-implemented method of assigning resources to a hierarchy of prioritized customer demands in a linear programming production planning system for determining a production plan, said method comprising:

receiving customer demands for resources from different customers;

rank ordering, by a computing device, said customer demands to create prioritized customer demands;

aggregating, by said computing device, said prioritized customer demands into a plurality of priority groups based on said rank ordering of said customer demands;

optimizing, by said computing device, a first mathematical linear programming model based on processing a highest priority group of said plurality of priority groups;

assigning, by said computing device, a portion of said resources to a highest priority group of said plurality of priority groups based on said optimizing said first linear programming model;

assigning, by said computing device, portions of remaining resources to a next highest priority group of said plurality of priority groups using a second mathematical linear programming model, wherein said second mathematical linear programming model uses results from said first mathematical linear programming model;

repeating said process of assigning portions of remaining resources, by said computing device, to remaining groups of said plurality of priority groups in order of priority using a different mathematical linear programming model for each iteration, wherein each subsequent mathematical linear programming model uses results from a previous linear programming model; and

outputting, by said computing device, a production plan based said assigning resources,

wherein during said assigning processes, each mathematical linear programming model assigns a range of backorder costs within the priority group of said plurality of priority groups to which the resources are currently being assigned.

14. The method in claim 13, wherein each different linear programming model uses a program solution of the previous linear programming model.

15. The method in claim 13, wherein during said assigning processes, each linear programming model fixes variables associated with priority groups that have a lower priority than priority group to which the resources are currently being assigned.

16. The method in claim 13, further comprising dividing said priority groups into different sub-priority tiers.

17. The method in claim 16, wherein said sub-priority tiers can be processed simultaneously.

18. A program storage device readable by machine, tangibly embodying a program of instructions executable by the machine to perform a method of assigning resources to a hierarchy of prioritized customer demands in a linear programming production planning system for determining a production plan, said method comprising:

receiving customer demands for resources from different customers;

rank ordering said customer demands to create prioritized customer demands;

aggregating said prioritized customer demands into a plurality of priority groups based on said rank ordering of said customer demands;

optimizing a first mathematical linear programming model based on processing a highest priority group of said plurality of priority groups;

assigning a portion of said resources to a highest priority group of said plurality of priority groups based on said optimizing said first linear programming model;

assigning portions of remaining resources to a next highest priority group of said plurality of priority groups using a second mathematical linear programming model, wherein said second mathematical linear programming model uses results from said first mathematical linear programming model;

repeating said process of assigning portions of remaining resources to remaining groups of said plurality of priority groups in order of priority, wherein each subsequent mathematical linear programming model uses results from a previous linear programming model; and

outputting, by said computing device, a production plan based said assigning resources,

wherein during said assigning processes, each mathematical linear programming model assigns a range of backorder costs within the priority group to of said plurality of priority groups which the resources are currently being assigned.

19. The program storage device in claim 18, wherein when repeating said process of assigning remaining resources, said method uses a different linear programming model for each iteration.

20. The program storage device in claim 19, wherein each different linear programming model uses a program solution of the previous linear programming model.

21. The program storage device in claim 18, wherein during said assigning processes, each linear programming model fixes variables associated with priority groups that have a lower priority than the priority group to which the resources are currently being assigned.

22. The program storage device in claim 18, wherein said method further comprises dividing said priority groups into different sub-priority tiers.

23. The program storage device in claim 22, wherein said sub—

priority tiers can be processed simultaneously.