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Planning Production and Workforce in a Discrete-Time Financial Model: Optimizing Cash-Flows Released

  • Pedro Martins
Part of the Lecture Notes in Economics and Mathematical Systems book series (LNE, volume 682)

Abstract

Production planning interacts with a number of functional aspects within the entire system of a company. Two of those aspects involve workforce and financial planning. In effect, growing production amounts may demand further workforce, which increases financial costs. On the contrary, lower levels of production may decrease workforce needs, while possibly resulting in lower financial incomes. So, there should exist an adequate balance on the production levels such that the cash-flows can generate the highest returns, along the entire financial stream. This suggests that these three elements of the system (production, workforce and cash-flows) are tightly connected, and that they should be planned together. This paper discusses this interaction, proposing a mixed integer linear programming formulation for a general outline of this three elements system. In order to simplify the discussion, while focusing in the interaction, we consider a single-product in a capacitated production process. Decisions involving cash-flows released along the planning horizon are also incorporated, including dividends payments, allowing the system to decide when and how much should be released outwards such that a given sustainability condition or a final outcome condition is met.

Keywords

Planning Horizon Mixed Integer Linear Programming Initial Capital Production Stream Cash Balance 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

Notes

Acknowledgements

We thank the reviewers for the valuable comments and suggestions. This work was partially supported by FCT (project PEst-OE/MAT/UI0152).

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Copyright information

© Springer International Publishing Switzerland 2016

Authors and Affiliations

  1. 1.Polytechnic Institute of Coimbra, ISCACQuinta Agrícola - BencantaCoimbraPortugal
  2. 2.Operations Research Center (CIO)University of LisbonLisbonPortugal

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