Title: Decision framework for capacity decision in a supply chain

Authors: Srikanta Routroy, Rambabu Kodali

Addresses: Mechanical Engineering Group, Birla Institute of Technology and Science, Pilani, Rajasthan, 333 031, India. ' Mechanical Engineering Group, Birla Institute of Technology and Science, Pilani, Rajasthan, 333 031, India

Abstract: Capacity decision in the supply chain is a complex, multi-attribute decision problem that must be accomplished within a constrained resource environment. An Analytic Hierarchy Process (AHP) allows decision-makers to find the priority values of the potential facilities| location in the supply chain by considering the relevant attributes. These priority values have to be maximised, whereas the cost of facilities| locations, which depends upon the number of such locations and their capacity and the cost associated owing to transportation of raw materials between suppliers and facilities| locations and of finished products between markets and facilities locations, have to be minimised while making capacity decision in the supply chain. For this, a decision framework is developed which integrates the AHP with a 0–1 integer-programming model. A simulated annealing model is used for solving the capacity decision problem in the supply chain.

Keywords: capacity decisions; supply chain management; SCM; analytical hierarchy process; AHP; facilities location; integer-programming; simulated annealing; agile systems; agile management; decision making.

DOI: 10.1504/IJASM.2006.011634

International Journal of Agile Systems and Management, 2006 Vol.1 No.4, pp.436 - 449

Published online: 06 Dec 2006 *

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