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Route Design for Lean Production Systems

Department of Management Sciences, University of Iowa, Iowa City, Iowa 52242
Department of Quantitative Analysis and Operations Management, University of Cincinnati, Cincinnati, Ohio 45221
Department of Management Sciences, University of Iowa, Iowa City, Iowa 52242
jeffrey-ohlmann{at}uiowa.edu
mike.fry{at}uc.edu
barrett-thomas{at}uiowa.edu

We consider the problem of routing a fleet of vehicles to pick up components from a network of suppliers and to deliver them to a fixed depot in a lean production system. The pursuit of low work-in-process inventory and production smoothing throughout the system introduces complicating side constraints, creating an enriched case of the vehicle routing problem with time windows and split deliveries. We present a two-phase routing and scheduling approach to address this problem. The routing phase consists of a nested tabu search heuristic that iterates between determining the suppliers' visit frequencies and developing vehicle routes. Given a routing plan, the scheduling phase determines the timing of supplier visits using a binary integer program designed to promote production leveling. Through computational testing on real-world data sets, we compare our solutions to those in the literature and those used by practitioners in the industry.

Key Words: vehicle routing; lean manufacturing; tabu search
History: Received: June 2007; revised: October 2007; accepted: November 2007.