Improving delivery reliability by a new due-date setting rule

We study the dynamic due-date setting problem where the objective is to improve delivery performance. Since the problem is NP-hard, we propose a simple, new, general, heuristic due-date setting procedure called the SL rule. For the classical M/M/1 queuing model, we analytically determine the optimum parameter for the proposed rule to achieve best due-date performance. We then show that the optimized SL rule outperforms the work-content-based TWK rule in terms of fraction tardy, mean tardiness, and mean earliness. Additional numerical and simulation analysis for a range of conditions, covering different shop workload levels and priority regimes, confirms that the proposed rule produces best due-date performance, compared to the work-content-based rule, under most of the conditions studied.