Studies on Tactical Capacity Planning with Contingent Capacities



This talk summarizes the content of my thesis, which addresses tactical capacity planning with permanent and contingent capacities for single item, single stage production-to-stock, production-to-order and service systems. The case of services is discussed in detail. Those service systems are modeled, where the tactical capacity decisions are constrained by a given budget for a finite horizon. This budget is allocated to cover permanent and contingent capacity cost over a finite horizon. In the beginning of the horizon the permanent capacity cost are incurred, and the rest of the budget is dynamically allocated to the contingent capacity. No backordering of tasks is allowed, instead, capacity shortages are penalized in each period. The numerically optimized expenditure patterns are compared with those found in the empirical literature. 
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René de Koster