A heuristic approach for determining lot sizes and schedules using power-of-two policy

Abstract

We consider the problem of determining realistic and easy-to-schedule lot sizes in a multiproduct, multistage manufacturing environment. We concentrate on a specific type of production, namely, flow shop type production. The model developed consists of two parts, lot sizing problem and scheduling problem. In lot sizing problem, we employ binary integer programming and determine reorder intervals for each product using power-of-two policy. In the second part, using the results obtained of the lot sizing problem, we employ mixed integer programming to determine schedules for a multiproduct, multistage case with multiple machines in each stage. Finally, we provide a numerical example and compare the results with similar methods found in practice.