ON PERFORMANCE MODELING OF PROJECT-ORIENTED PRODUCTION

A methodology has been developed in order to incorporate a performance perspective into production planning. The concept of project-oriented production has been used to emphasize a hierarchical structure for an alysis and decision making. Based on a new type of resource workload m odel, the methodology has been applied to estimate the speed-rep of ea ch project for different levels of the resources assigned to it. We in troduce the notion of leverage to trade-off resource usage or efficien cy with each project duration or makespan. Using leverage we are able to find for each project the optimal level of resources that minimize peak demands through variation of aggregate activity intensities. Proj ect performance has been integrated within production planning using a two-tier iterative scheme. In the upper level, resource leveraging is carried out. In the lower level, feasibility constraints are applied to adjust aggregate activity intensities and project milestones. This process is implemented interactively until a solution consistent with management's objectives is obtained. The most attractive feature of th is strategy is that only extreme (early and late) schedules are requir ed. (C) 1997 Elsevier Science Ltd.