Multiperiod Planning Strategies with Simultaneous Consideration of Demand Fluctuations and Capacity Expansion

Considerable attention has been given to multiperiod planning in process communities in order to hedge against varying conditions. The negative impact of variations can be minimized by preparing production and inventory levels of the current and future operations. This paper aims to highlight how external conditions in the planning model are synchronized with internal process operations to obtain the maximum effect. Two strategies are discussed. One is to modify the external condition, mainly varying demands, suitable for the plant operation, and the other is to expose explicit constraints limiting capacity expansion based on actual expansion times in the model. Two numerical examples are presented to illustrate the potential of the proposed strategies with some discussion on applying these strategies in practice.