Capacity Expansion (capacity + expansion)

Distribution by Scientific Domains
Mathematics and Statistics63%

Selected Abstracts

CAPACITY EXPANSION IN MARKETS WITH INTER-TEMPORAL CONSUMPTION EXTERNALITIES

AUSTRALIAN ECONOMIC PAPERS, Issue 2 2010
Article first published online: 20 MAY 2010, HIROSHI KITAMURA
This paper analyses market capacity expansion in the presence of inter-temporal consumption externalities such as consumer learning, networks and bandwagon effects. An externality leads to an endogenous shift of market demand that responds to past market capacity. Whereas market capacity grows in waves, its magnitude depends on the degree of market concentration. The competitive environment contributes to S-shaped time patterns of market capacity expansion. On the other hand, using a low introductory price, a monopolist plans an initially larger amount of market cultivation than a competitive market capacity expansion. [source]

Capacity expansion under a service-level constraint for uncertain demand with lead times

NAVAL RESEARCH LOGISTICS: AN INTERNATIONAL JOURNAL, Issue 3 2009
Rahul R. Marathe
Abstract For a service provider facing stochastic demand growth, expansion lead times and economies of scale complicate the expansion timing and sizing decisions. We formulate a model to minimize the infinite horizon expected discounted expansion cost under a service-level constraint. The service level is defined as the proportion of demand over an expansion cycle that is satisfied by available capacity. For demand that follows a geometric Brownian motion process, we impose a stationary policy under which expansions are triggered by a fixed ratio of demand to the capacity position, i.e., the capacity that will be available when any current expansion project is completed, and each expansion increases capacity by the same proportion. The risk of capacity shortage during a cycle is estimated analytically using the value of an up-and-out partial barrier call option. A cutting plane procedure identifies the optimal values of the two expansion policy parameters simultaneously. Numerical instances illustrate that if demand grows slowly with low volatility and the expansion lead times are short, then it is optimal to delay the start of expansion beyond when demand exceeds the capacity position. Delays in initiating expansions are coupled with larger expansion sizes. © 2009 Wiley Periodicals, Inc. Naval Research Logistics, 2009 [source]

Capacity expansion with lead times and autocorrelated random demand

NAVAL RESEARCH LOGISTICS: AN INTERNATIONAL JOURNAL, Issue 2 2003
Sarah M. Ryan
Abstract The combination of uncertain demand and lead times for installing capacity creates the risk of shortage during the lead time, which may have serious consequences for a service provider. This paper analyzes a model of capacity expansion with autocorrelated random demand and a fixed lead time for adding capacity. To provide a specified level of service, a discrete time expansion timing policy uses a forecast error-adjusted minimum threshold level of excess capacity position to trigger an expansion. Under this timing policy, the expansion cost can be minimized by solving a deterministic dynamic program. We study the effects of demand characteristics and the lead time length on the capacity threshold. Autocorrelation acts similarly to randomness in hastening expansions but has a smaller impact, especially when lead times are short. However, the failure either to recognize autocorrelation or to accurately estimate its extent can cause substantial policy errors. © 2003 Wiley Periodicals, Inc. Naval Research Logistics, 2003 [source]

Multi-Period Planning of Survivable WDM Networks

EUROPEAN TRANSACTIONS ON TELECOMMUNICATIONS, Issue 1 2000
Mario Pickavet
This paper presents a new heuristic algorithm useful for long-term planning of survivable WDM networks. A multi-period model is formulated that combines network topology design and capacity expansion. The ability to determine network expansion schedules of this type becomes increasingly important to the telecommunications industry and to its customers. The solution technique consists of a Genetic Algorithm that allows to generate several network alternatives for each time period simultaneously and shortest-path techniques to deduce from these alternatives a least-cost network expansion plan over all time periods. The multi-period planning approach is illustrated on a realistic network example. Extensive simulations on a wide range of problem instances are carried out to assess the cost savings that can be expected by choosing a multi-period planning approach instead of an iterative network expansion design method. [source]

Optimal machine capacity expansions with nested limitations under stochastic demand

NAVAL RESEARCH LOGISTICS: AN INTERNATIONAL JOURNAL, Issue 2 2004
Metin Çakany
This paper studies capacity expansions for a production facility that faces uncertain customer demand for a single product family. The capacity of the facility is modeled in three tiers, as follows. The first tier consists of a set of upper bounds on production that correspond to different resource types (e.g., machine types, categories of manpower, etc.). These upper bounds are augmented in increments of fixed size (e.g., by purchasing machines of standard types). There is a second-tier resource that constrains the first-tier bounds (e.g., clean room floor space). The third-tier resource bounds the availability of the second-tier resource (e.g., the total floor space enclosed by the building, land, etc.). The second and third-tier resources are expanded at various times in various amounts. The cost of capacity expansion at each tier has both fixed and proportional elements. The lost sales cost is used as a measure for the level of customer service. The paper presents a polynomial time algorithm (FIFEX) to minimize the total cost by computing optimal expansion times and amounts for all three types of capacity jointly. It accommodates positive lead times for each type. Demand is assumed to be nondecreasing in a "weak" sense. © 2003 Wiley Periodicals, Inc. Naval Research Logistics, 2004. [source]

Capacity expansion with lead times and autocorrelated random demand

NAVAL RESEARCH LOGISTICS: AN INTERNATIONAL JOURNAL, Issue 2 2003
Sarah M. Ryan
Abstract The combination of uncertain demand and lead times for installing capacity creates the risk of shortage during the lead time, which may have serious consequences for a service provider. This paper analyzes a model of capacity expansion with autocorrelated random demand and a fixed lead time for adding capacity. To provide a specified level of service, a discrete time expansion timing policy uses a forecast error-adjusted minimum threshold level of excess capacity position to trigger an expansion. Under this timing policy, the expansion cost can be minimized by solving a deterministic dynamic program. We study the effects of demand characteristics and the lead time length on the capacity threshold. Autocorrelation acts similarly to randomness in hastening expansions but has a smaller impact, especially when lead times are short. However, the failure either to recognize autocorrelation or to accurately estimate its extent can cause substantial policy errors. © 2003 Wiley Periodicals, Inc. Naval Research Logistics, 2003 [source]

Cycle-based algorithms for multicommodity network flow problems with separable piecewise convex costs

NETWORKS: AN INTERNATIONAL JOURNAL, Issue 2 2008
Mauricio C. de Souza
Abstract We present cycle-based algorithmic approaches to find local minima of a nonconvex and nonsmooth model for capacity expansion of a network supporting multicommodity flows. By exploiting complete optimality conditions for local minima, we give the convergence analysis of the negative-cost cycle canceling method. The cycle canceling method is embedded in a tabu search strategy to explore the solution space beyond the first local optimum. Reaching a local optimum, the idea is to accept a cost-increasing solution by pushing flow around a positive-cost cycle, and then to make use of the cycle cancelling method incorporating tabu search memory structures to find high quality local optima. Computational experiments on instances of the literature show that the tabu search algorithm can significantly improve feasible solutions obtained by the local optimization procedure, and it outperforms the capacity and flow assignment heuristic in terms of solution quality. © 2007 Wiley Periodicals, Inc. NETWORKS, 2008 [source]

CAPACITY EXPANSION IN MARKETS WITH INTER-TEMPORAL CONSUMPTION EXTERNALITIES

AUSTRALIAN ECONOMIC PAPERS, Issue 2 2010
Article first published online: 20 MAY 2010, HIROSHI KITAMURA
This paper analyses market capacity expansion in the presence of inter-temporal consumption externalities such as consumer learning, networks and bandwagon effects. An externality leads to an endogenous shift of market demand that responds to past market capacity. Whereas market capacity grows in waves, its magnitude depends on the degree of market concentration. The competitive environment contributes to S-shaped time patterns of market capacity expansion. On the other hand, using a low introductory price, a monopolist plans an initially larger amount of market cultivation than a competitive market capacity expansion. [source]

Optimal machine capacity expansions with nested limitations under stochastic demand

NAVAL RESEARCH LOGISTICS: AN INTERNATIONAL JOURNAL, Issue 2 2004
Metin Çakany
This paper studies capacity expansions for a production facility that faces uncertain customer demand for a single product family. The capacity of the facility is modeled in three tiers, as follows. The first tier consists of a set of upper bounds on production that correspond to different resource types (e.g., machine types, categories of manpower, etc.). These upper bounds are augmented in increments of fixed size (e.g., by purchasing machines of standard types). There is a second-tier resource that constrains the first-tier bounds (e.g., clean room floor space). The third-tier resource bounds the availability of the second-tier resource (e.g., the total floor space enclosed by the building, land, etc.). The second and third-tier resources are expanded at various times in various amounts. The cost of capacity expansion at each tier has both fixed and proportional elements. The lost sales cost is used as a measure for the level of customer service. The paper presents a polynomial time algorithm (FIFEX) to minimize the total cost by computing optimal expansion times and amounts for all three types of capacity jointly. It accommodates positive lead times for each type. Demand is assumed to be nondecreasing in a "weak" sense. © 2003 Wiley Periodicals, Inc. Naval Research Logistics, 2004. [source]