MIP-Based Heuristics for Capacitated Lot-Sizing with Sequence-Dependent Setups and Substitutions

Abstract

In this section, we consider a single-level capacitated lot-sizing problem with substitutions and sequence-dependent setups. The model was designed to map the industrial optimization problem in windshield interlayer production planning described in Sect. 3.1. Rather than building a specific model for this application, we aimed at devising a model and appropriate solution approach for a more general model that can capture the characteristics of this application as well as those of similar production planning problems. Why should it make sense to consider substitutions and sequence-dependent changeovers in one model, rather than treating each of the two aspects in separate subproblems that decompose the overall problem? The idea is that substitutions affect the optimal production sequencing and vice versa, as it might be beneficial to save setup times by refraining from producing certain products and substituting them by others, at least in some settings. This reduces the time spent with “worthless” changeovers, and thereby increases the total capacity available for production.