Decision Sciences Journal
Volume 31, Number 1
Winter 2000
Multiperiod Capacity Expansion in Globally Dispersed Regions
Siddhartha S. Syam
College of Business Administration, P.O. Box 1881, Marquette
University, Milwaukee, WI 53201-1881, email: syam@mail.busadm.mu.edu
ABSTRACT. Multiperiod capacitated location (MCL) models
specify where and when capacity expansions should be made, and
how large they should be. The MCL model developed in this paper
incorporates a shift from manufacturing for overseas markets
to manufacturing in overseas markets. While MCL models generally
have not provided lower bounds on the optimal solution, the methodology
of this paper provides both upper and lower bounds. Computational
results are given for problems involving up to 200 locations/destinations
and 10-year planning horizons. Near-optimal solutions are provided
in reasonable computing times with average convergence less than
2%. Representative variations in cost between regions are simulated
in the test problems, and the managerial implications of alternative
diversification strategies are also assessed.
Subject Areas: Distribution/Logistics, Lagrangian Relaxation,
and Location. |