Evaluation of the Production Planning Policy Alternatives in a Pet Resin Production Plant: a Case Study From Turkey

Abstract

Goal: The main purpose of this work is to develop several production planning models for one of bottle grade PET production plants (in Turkey) under different scenarios by considering different levels of inventory (no stock and different levels of safety stocks), different energy sourcing alternatives (natural gas/coal or both) and production throughput (different lot sizes).
 Design/Methodology/Approach: Deterministic multi-product multi-period single level mixed integer linear programming model is presented. The model is implemented for the above defined scenarios. We have also considered the total emission produced for different energy alternatives.
 Results: The models for the different scenarios have shown that significant performance improvements can be achieved by changing the parameters/policies of the production. The best model obtained has yielded 6.6% of profit improvement and 6.9% of cost reduction.
 Limitations of the investigation: Planning horizon of this work could cover the data of years 2014 to 2018. However, the actual data employed for this study is limited with one year due to unavailability of further data. In addition to this, improvement of current production planning approach of the plant by implementation of proposed model is one of the objectives of this study to see success rate of model. Though, this couldn’t be realized. We hypothetically tested the improvement provided by the proposed model, therefore we can’t analyze the actual improvement.
 Practical implications: Interactions among optimal results obtained by running model with different scenarios and their effect on selected performance variables are the main contribution of this work. Similar methodology could be used at other PET resin manufacturing plants or alternatively the production facilities having similar type of continuous manufacturing processes to find their optimal levels of inventory, production throughput and proper choice for energy sourcing alternative.
 Originality/Value: The research on the production planning for PET resin industry by considering the different scenarios (levels of inventory / energy sourcing alternatives/ production throughput) is novel as far as we know, and therefore the approach used in this study is expected to be useful for other similar plants.

Dynamic Programming Approach in Aggregate Production Planning Model under Uncertainty

“…The nature of the data or input parameters in real-world APP issues, such as those involving demand, resources, costs, objective function coefficients, etc., is inherently imprecise due to the fact that some information cannot be retrieved or is unavailable in its whole [11]. In business practice, products usually have an uncertain demand and variable [12], customer preferences change, production capacity is limited [13], labor market conditions are unstable, subcontracting can incur higher costs [14], uncertainty of raw material supply [15], and an increase in backorders caused customer claim and led them to change the source of their purchases [8], [16]. This demonstrates the complex characteristics of APP and an appropriate APP model is needed.…”