While the joint optimization of production and outbound distribution decisions in a manufacturing context has been intensively studied in the past decade, the integration of production, inventory and inbound transportation from suppliers has received much less attention despite its practical relevance. We aim to fill the gap by introducing a general model for the assembly routing problem (ARP), which consists of simultaneously planning the assembly of a finished product at a plant and the routing of vehicles collecting materials from suppliers to meet the inventory requirements imposed by the production. We formulate the problem as a mixed-integer linear program and we propose a three-phase decomposition
matheuristic that relies on the iterative solution of different subproblems. The first phase determines a setup schedule while the second phase optimizes production quantities, supplier visit schedules and shipment quantities. The third phase solves a vehicle routing problem for each period in the planning horizon. The algorithm is flexible and we show how it can also be used to solve two well-known problems related to the ARP: the production routing problem (PRP) and the inventory routing problem (IRP). Using the same parameter setting for all problems and instances, we obtain 781 new best known solutions out of 2,628 standard IRP and PRP test instances. In particular, on large-scale multi-vehicle instances, the new algorithm outperforms specialized state-of-the-art heuristics for these two problems.
Jean-François Cordeaus obtained his Ph.D. in Applied Mathematics at the École Polytechnique de Montréal in 1999. He is a professor of Operations Management at HEC Montréal, where he also holds the Chair in Logistics and Transportation. Since 2000, he has been responsible for the Master of Science in Global Supply Chain Management at HEC. He is a member of the Interuniversity Research Centre on Enterprise Networks, Logistics and Transportation (CIRRELT) and of the Group for Research in Decision Analysis (GERAD). He was Deputy Director of CIRRELT from 2008 to 2013. He has authored or coauthored more than 120 scientific articles in combinatorial optimization and mathematical decomposition, mostly in the fields of vehicle routing and logistics network design. He has also supervised more than 60 M.Sc. and Ph.D. students. He is an Associate Editor of IIE Transactions and Transportation Science, and a member of the Editorial Board of Computers & Operations Research. Dr. Cordeau has also acted as a consultant for several Canadian and European organizations in the private and public sectors. In 2009, he and three of his colleagues won First Prize in the ROADEF Challenge on Disruption Management for Commercial Aviation. Since 2014, he is a member of the College of New Scholars, Artists and Scientists of the Royal Society of Canada. He received the Award of Merit from the Canadian Operational Research Society in 2016.