International Operations Management and Logistics: Simona Mancini

International Operations
Management and Logistics

Simona Mancini
Outlines
 Introduction
 Decision problems in Operations Management
 Simple assignement problems
 Facility Location
 Decision problems arising in distribution and transportation
 Packing Problems
 Scheduling problems
Introduction
 every action in our life implies a decision process
 Diet problem
 Knapsack problem
 Portfolio problem
Knapsack problem
 A set of items I characterized by
 weight wi
 profit pi
 A knapsack with capacity W
 The goal is to maximize the total collected profit while respecting the
capacity constraint
Knapsack problem

s.t.
Knapsack extensions
 Multi Knapsack
 multiple knapsack with different capacity Wj
 several applications in logistics, knapsacks can represent vehicles of different
sizes, or ships in maritime logistics or containers
 Multi Dimensional Knapsack

 each knapsack is characterized by different resources for which they have a
limited capacity (for instance weight and volume in logistics or weight and
value in transfer of valuable objects among banks)
Knapsack Extensions
 Knapsack with items incompatibility
 Pairs of items cannot be assigned to the same knapsack
 Applications in delivery to groceries
 Example: Cleaning products cannot be carried together with fresh foods, vegetables
 Knapsack with family of items and split penalties
 Applications in logistics
 A family of items group all packages required by the same customers and they should
be packed in the same container (or vehicle) in order to minimize delivery costs
Applications in cloud computing
A family represents all the executable files related to the same application
If those files are split among different machines a latency may occur and this must be
penalized
Assignment problem
 Patients-to-doctor assignment problem
 Each patient must be assigned to a doctor

 A maximum number of patients that can be assigned to a doctor
 Goal: minimize distances covered by the patients to go to the doctor
 Generalization: doctors->facilities / patients->customers

Facilities Location Problem
 We have to choose which facilities to open
 Opening cost for facilities
 Assignment of customers to facilities
 Capacitated / uncapacitated
 Problem arising in supply chain
Packing problems
 Goal of a knapsack problem
 select the combination of items that maximize collected profit
 while respecting capacity constraints
 Goal of a packing problem

 minimize the number of bins (knapsacks, vehicles, containers..)
 it is mandatory to assign all the items to a bin
 if using a heterogenous set of bins the goal
Packing problems
Objective: #bins minimization

s.t.
Variable size and cost bin packing
Objective: cost minimization

s.t.
Bins of different cost and size

3D packing
 Not only working on the item-to-bin assignment problem
 Items of different size and shape
 Positioning of items within the bin
 Applications in vehicle loading for transportation and good delivery
 Fragile objects
 Complete overlapping
 Vertical weight restrictions
 Rotation
 Gravity center
 Strip packing
Scheduling
 Assignment of task and processing order
 Application in industry in which jobs must be performed by machines
 Application in workforce scheduling: assignment of task to workers
 Several objective functions: total completion time, average
completion time, weighted completion time..
 Precedence constraints
 Jobs-machines compatibility
Decision Sciences in Operations Management
 Who? When? Where? How much?
 Strategical level (long term)
 Tactical level (medium term)
 Operational level (short term)
 Static / Dynamic
 Deterministic / Stochastic decisions
Public/ private sector

 Offer a better service within a maximum budget / obtain the best profit ensuring a minimum level of service quality
Example: Maritime Network Design
 strategical level: fleet sizing, how many vessels of each kind to buy
 time horizon 4-5 years
 tactical level: services frequency and scheduling

 time horizon 3-6 months
Example: Airline company
 Strategical: fleet sizing and hub location
 Tactical: Flight scheduling
 Operational: Crew Scheduling

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International Operations

Management and Logistics

 Multi Dimensional Knapsack

 Each patient must be assigned to a doctor

 Generalization: doctors->facilities / patients->customers

 Goal of a packing problem

Bins of different cost and size

 Strategical level (long term)

 Tactical level (medium term)

 Operational level (short term)

Public/ private sector

 tactical level: services frequency and scheduling

 Tactical: Flight scheduling

 Operational: Crew Scheduling

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