Stochastic dynamic programming heuristic for the (R,s,S) policy parameters computation
From MaRDI portal
(Redirected from Stochastic dynamic programming heuristic for the (R,s,S) policy parameters computation)
Stochastic dynamic programming heuristic for the \((R,s,S)\) policy parameters computation
Stochastic dynamic programming heuristic for the \((R,s,S)\) policy parameters computation
Abstract: The (R, s, S) is a stochastic inventory control policy widely used by practitioners. In an inventory system managed according to this policy, the inventory is reviewed at instant R; if the observed inventory position is lower than the reorder level s an order is placed. The order's quantity is set to raise the inventory position to the order-up-to-level S. This paper introduces a new stochastic dynamic program (SDP) based heuristic to compute the (R, s, S) policy parameters for the non-stationary stochastic lot-sizing problem with backlogging of the excessive demand, fixed order and review costs, and linear holding and penalty costs. In a recent work, Visentin et al. (2021) present an approach to compute optimal policy parameters under these assumptions. Our model combines a greedy relaxation of the problem with a modified version of Scarf's (s, S) SDP. A simple implementation of the model requires a prohibitive computational effort to compute the parameters. However, we can speed up the computations by using K-convexity property and memorisation techniques. The resulting algorithm is considerably faster than the state-of-the-art, extending its adoptability by practitioners. An extensive computational study compares our approach with the algorithms available in the literature.
Recommendations
- Approximations for non-stationary stochastic lot-sizing under \((s,Q)\)-type policy
- Computing non-stationary \((s, S)\) policies using mixed integer linear programming
- Computing optimal \((R, s, S)\) policy parameters by a hybrid of branch-and-bound and stochastic dynamic programming
- A Simple Heuristic for Computing Nonstationary (s, S) Policies
- An efficient lot-sizing heuristic for a periodic-review inventory system under non-stationary stochastic demand
Cites work
- A mixed integer programming formulation for the stochastic lot sizing problem with controllable processing times
- An enhanced L-shaped method for optimizing periodic-review inventory control problems modeled via two-stage stochastic programming
- An extended mixed-integer programming formulation and dynamic cut generation approach for the stochastic lot-sizing problem
- Computing non-stationary \((s, S)\) policies using mixed integer linear programming
- Computing optimal \((R, s, S)\) policy parameters by a hybrid of branch-and-bound and stochastic dynamic programming
- Controlling distribution inventory systems with shipment consolidation and compound Poisson demand
- Dynamic lot sizing with random demand and non-stationary costs
- Exact fill rates for (R, s, S) inventory control with gamma distributed demand
- scientific article; zbMATH DE number 3322720 (Why is no real title available?)
- Inventory control
- Nervousness in inventory management: Comparison of basic control rules
- Optimal and simple approximate solutions to a production-inventory system with stochastic and deterministic demand
- Optimal Inventory Policy
- Optimal production and inventory control of multi-class mixed backorder and lost sales demand class models
- Solving a novel inventory location model with stochastic constraints and \((R,s,S)\) inventory control policy
- Strategies for the Probabilistic Lot-Sizing Problem with Service-Level Constraints
- The stochastic lot-sizing problem with quantity discounts
This page was built for publication: Stochastic dynamic programming heuristic for the \((R,s,S)\) policy parameters computation
Report a bug (only for logged in users!)Click here to report a bug for this page (MaRDI item Q6106598)
