A robust optimization model for a cross-border logistics problem with fleet composition in an uncertain environment

Since the implementation of the open-door policy in China, many Hong Kong-based manufacturers' production lines have moved to China to take advantage of the lower production cost, lower wages, and lower rental costs, and thus, the finished products must be transported from China to Hong Kong. It has been discovered that logistics management often encounters uncertainty and noisy data. In this paper, a robust optimization model is proposed to solve a cross-border logistics problem in an environment of uncertainty. By adjusting penalty parameters, decision-makers can determine an optimal long-term transportation strategy, including the optimal delivery routes and the optimal vehicle fleet composition to minimize total expenditure under different economic growth scenarios. We demonstrate the robustness and effectiveness of our model using the example of a Hong Kong-based manufacturing company. The analysis of the trade-off between model robustness and solution robustness is also presented.     

A bi-level programming model and solution algorithm for the location of logistics distribution centers

In this paper, by considering benefits of customers and logistics planning departments, a bi-level programming model is presented to seek the optimal location for logistics distribution centers. The upper-level model is to determine the optimal location by minimizing the planners’ cost, and the lower gives an equilibrium demand distribution by minimizing the customers’ cost. Based on the special form of constraints, a simple heuristic algorithm is proposed. Finally, a numerical example is used to illustrate the application of the method, which shows that the algorithm is feasible and advantageous.     

Optimizing flow rates in a queueing network with side constraints

In this paper, modified versions of the classical deterministic maximum flow and minimum cost network flow problems are presented in a stochastic queueing environment. In the maximum flow network model, the throughput rate in the network is maximized such that for each arc of the network the resulting probability of finding congestion along that arc in excess of a desirable threshold does not exceed an acceptable value. In the minimum cost network flow model, the minimum cost routing of a flow of given magnitude is determined under the same type of constraints on the arcs. After proper transformations, these models are solved by Ford and Fulkerson's labeling algorithm and out-of-kilter algorithm, respectively.     

A 2-approximation algorithm for the network substitution problem

The network substitution problem is to substitute an existing network for a new network so that to minimize the cost of exploiting the existing network during the period when the new network is being constructed. We show that this problem is NP-hard, and propose a 2-approximation algorithm for solving it.     

An airline scheduling model and solution algorithms under stochastic demands

When setting a good flight schedule airlines not only have to consider their fleet supply and related operations, as well as market share, but also stochastic variations caused by daily passenger demands in actual operations. Most of the past research on short-term flight scheduling has used the average passenger demand as input to produce the final timetable and schedule, which means that daily passenger variations that occur in actual operations are neglected. To consider such stochastic disturbances we developed a stochastic-demand scheduling model. We employed arc-based and route-based strategies to develop two heuristic algorithms that can be used to solve the model. The test results, based on a major Taiwan airline’s operation, show the good performance of the model and the solution algorithms.     

Capacity allocation problem with random demands for the rail container carrier

In this paper, we consider the formulation and heuristic algorithm for the capacity allocation problem with random demands in the rail container transportation. The problem is formulated as the stochastic integer programming model taking into account matches in supply and demand of rail container transportation. A heuristic algorithm for the stochastic integer programming model is proposed. The solution to the model is found by maximizing the expected total profit over the possible control decisions under the uncertainty of demands. Finally, we give numerical experiments to demonstrate the efficiency of the heuristic algorithm.     

A branch-and-price algorithm for the capacitated vehicle routing problem with stochastic demands

This article introduces a new exact algorithm for the capacitated vehicle routing problem with stochastic demands (CVRPSD). The CVRPSD can be formulated as a set partitioning problem and it is shown that the associated column generation subproblem can be solved using a dynamic programming scheme. Computational experiments show promising results.     

An efficient approximation algorithm for the survivable network design problem

The survivable network design problem (SNDP) is to construct a minimum-cost subgraph satisfying certain given edge-connectivity requirements. The first polynomial-time approximation algorithm was given by Williamson et al. (Combinatorica 15 (1995) 435–454). This paper gives an improved version that is more efficient. Consider a graph ofn vertices and connectivity requirements that are at mostk. Both algorithms find a solution that is within a factor 2k – 1 of optimal fork 2 and a factor 2 of optimal fork = 1. Our algorithm improves the time from O(k ³n⁴) to O ). Our algorithm shares features with those of Williamson et al. (Combinatorica 15 (1995) 435–454) but also differs from it at a high level, necessitating a different analysis of correctness and accuracy; our analysis is based on a combinatorial characterization of the redundant edges. Several other ideas are introduced to gain efficiency. These include a generalization of Padberg and Rao's characterization of minimum odd cuts, use of a representation of all minimum (s, t) cuts in a network, and a new priority queue system. The latter also improves the efficiency of the approximation algorithm of Goemans and Williamson (SIAM Journal on Computing 24 (1995) 296–317) for constrained forest problems such as minimum-weight matching, generalized Steiner trees and others. © 1998 The Mathematical Programming Society, Inc. Published by Elsevier Science B.V.A preliminary version of this paper has appeared in the Proceedings of the Third Mathematical Programming Society Conference on Integer Programming and Combinatorial Optimization, 1993, pp. 57–74.Research supported in part by NSF Grant No. CCR-9215199 and AT & T Bell Laboratories.Research supported in part by Air Force contracts AFOSR-89-0271 and F49620-92-J-0125 and DARPA contracts N00014-89-J-1988 and N00014-92-1799.This research was performed while the author was a graduate student at MIT. Research supported by an NSF Graduate Fellowship, Air Force contract F49620-92-J-0125, DARPA contracts N00014-89-J-1988 and N00014-92-J-1799, and AT & T Bell Laboratories.     

The traveling purchaser problem with stochastic prices: Exact and approximate algorithms

The paper formulates an extension of the traveling purchaser problem where multiple types of commodities are sold at spatially distributed locations with stochastic prices (each following a known probability distribution). A purchaser’s goal is to find the optimal routing and purchasing strategies that minimize the expected total travel and purchasing costs needed to purchase one unit of each commodity. The purchaser reveals the actual commodity price at a seller upon arrival, and then either purchases the commodity at the offered price, or rejects the price and visits a next seller. In this paper, we propose an exact solution algorithm based on dynamic programming, an iterative approximate algorithm that yields bounds for the minimum total expected cost, and a greedy heuristic for fast solutions to large-scale applications. We analyze the characteristics of the problem and test the computational performance of the proposed algorithms. The numerical results show that the approximate and heuristic algorithms yield near-optimum strategies and very good estimates of the minimum total cost.     

Sell or Hold: A simple two-stage stochastic combinatorial optimization problem

The sell or hold problem (SHP) is to sell k out of n indivisible assets over two stages, with known first-stage prices and random second-stage prices, to maximize the total expected revenue. We show that SHP is NP-hard when the second-stage prices are realized as a finite set of scenarios. We show that SHP is polynomially solvable when the number of scenarios in the second stage is constant. A max{1/2,k/n}-approximation algorithm is presented for the scenario-based SHP.     

An approximation algorithm for a facility location problem with stochastic demands and inventories

We propose a 2-approximation algorithm for a facility location problem with stochastic demands. At open facilities, inventory is kept such that arriving requests find a zero inventory with (at most) some pre-specified probability. Costs incurred are expected transportation costs, facility operating costs and inventory costs.     

Reliable design of a logistics network under uncertainty: A fuzzy possibilistic-queuing model

This paper proposes a bi-objective model for designing a reliable network of bi-directional facilities in logistics network under uncertainties. For this purpose, the model utilizes an effective reliability approach to find a robust logistics network design. The objectives of the model are to minimize the total costs and the expected transportation costs after failures of bi-directional facilities of the logistics network. To solve the model, a new solution approach is proposed by combining queuing theory, fuzzy possibilistic programming and fuzzy multi-objective programming. Finally, the computational experiments are provided to illustrate the effectiveness of the proposed model and solution approach.     

A branch-and-cut algorithm for the equicut problem

We describe an algorithm for solving the equicut problem on complete graphs. The core of the algorithm is a cutting-plane procedure that exploits a subset of the linear inequalities defining the convex hull of the incidence vectors of the edge sets that define an equicut. The cuts are generated by several separation procedures that will be described in the paper. Whenever the cutting-plane procedure does not terminate with an optimal solution, the algorithm uses a branch-and-cut strategy. We also describe the implementation of the algorithm and the interface with the LP solver. Finally, we report on computational results on dense instances with sizes up to 100 nodes.     

The flow shop problem with no-idle constraints: A review and approximation

The makespan minimization problem in flow shops with no-idle constraints on machines is considered. The latter means that each machine, once started, must process all its operations without intermediate idle time until all those operations are completed. The problem is known to be strongly NP-hard already for three machines. While being based on a geometrical approach, we propose several polynomial time heuristics (for the general case and for special cases of 3 and 4 machines) which provide asymptotically optimal solutions for the increasing number of jobs. A comprehensive review of relevant results is also presented.     

Improved modeling and solution methods for the multi-resource routing problem

This paper presents modeling and solution method improvements for the Multi-Resource Routing Problem (MRRP) with flexible tasks. The MRRP with flexible tasks is used to model routing and scheduling problems for intermodal drayage operations in which two resources (tractors and trailers) perform tasks to transport loaded and empty equipment. Tasks may be either well defined, in which both the origin and the destination of a movement are given, or flexible, in which the origin or the destination is chosen by the model. This paper proposes methods to effectively manage the number of options considered for flexible tasks (either feasible origins for a known destination or feasible destinations for a known origin). This modeling change generates sufficient options to allow for low-cost solutions while maintaining reasonable computational effort. We also propose a new solution method that uses randomized route generation. Computational results from test cases show that these changes improve the quality of solutions by at least 5% in the test cases as compared to methods from previous studies.     

A practical map labeling algorithm

The map labeling problem is a classical problem of cartography. There is a theoretically optimal approximation algorithm A. Unfortunately A is useless in practice as it typically produces results that are intolerably far off the optimal size. On the other hand there are heuristics with good practical results.

In this paper we present an algorithm B that (1) guarantees the optimal approximation quality and runtime behaviour of A, and (2) yields results significantly closer to the optimum than the best heuristic known so far.

The sample data used in the experimental evaluation consists of three different classes of random problems and a selection of problems arising in the production of groundwater quality maps by the authorities of the City of Munich.     

Greedy vacancy search algorithm for packing equal circles in a square

This paper considers the problem of finding the densest packings of equal circles in a square. We propose a physically inspired model to formulate this problem and a new heuristic algorithm to solve this problem. The approach is tested on the instances of N=1,2,…,200. Though many researchers have searched these instances using various methods, we can still find 41 better packings than the best-known ones reported in literature.     

Doubly uncertain transportation network: Degradable capacity and stochastic demand

This study developed a methodology to model doubly uncertain transportation network with stochastic link capacity degradation and stochastic demand. We consider that the total travel demand comprises of two parts, infrequent travelers and commuters. The traffic volume of infrequent travelers is stochastic, which adds to the network traffic in a random manner based on fixed route choice proportions. On the other hand, the traffic volume of commuters is stable or deterministic. Commuters acquire the network travel time variability from past experiences, factor them into their route choice considerations, and settle into a long-term habitual route choice equilibrium in which they have no incentive of switching away. To define this equilibrium, we introduce the notion of “travel time budget” to relate commuters’ risk aversion on route choices in the presence of travel time variability. The travel time budget varies among commuters according to their degrees of risk aversion and requirements on punctual arrivals. We then developed a mixed-equilibrium formulation to capture these stochastic considerations and illustrated its properties through some numerical studies.     

A strongly polynomial algorithm for the transportation problem

For the (linear) transportation problem withm supply nodes,n demand nodes andk feasible arcs we describe an algorithm which runs in time proportional tom logm(k + n logn) (assuming w.l.o.g.mn). The algorithm uses excess scaling. The complexity bound is a slight improvement over the bound achieved by an application of a min-cost-flow algorithm of Orlin to the transportation problem.Corresponding author. Research supported in part by grant no. I-84-095.06/88 of the German—Israeli-Foundation for Scientific Research and Development.