MULTILOCATION PLANT SIZING AND TIMING PROBLEM - ANALYSIS OF SPATIAL DECOMPOSITION PROCEDURE

The multilocation plant sizing and timing problem (MLPSTP) is an impor tant strategic management problem which involves determination of size , location, time-phasing and utilization of projects to meet the deman ds of spatially distributed customers. The objective for the analysis of such a problem has been to minimize the net present worth of the ca pital costs as well as the streams of operating and transportation cos ts. MLPSTP is a mixed integer programming problem involving both binar y and continuous variables. The continuous variables relate to the tra nsportation of commodities from site to market. The binary variables p roblem relates to the size, location and time-phasing of the projects. In this paper, an attempt has been made to analyse the problem by usi ng hierarchical decomposition procedures. The approach has been to con struct a two-level hierarchy; the first level identifying the distinct geographical areas as independent subproblems, and the second level b eing the coordination level which aims at synthesizing the solutions o f the area subproblems.