A Flexible Design for Logistic Network under Uncertain Demands through Hybrid Meta-heuristic Strategy

Abstract

We have proposed a practical method to solve a hierarchical logistics optimization problem under uncertain demands based on the meta-heuristic method termed Hybrid Tabu Search. For this purpose, we have formulated the problem by employing the idea from flexibility analysis. There, first, we classified the decision variables into two kinds depending on their generic natures, e.g., hard one like facility location not easy to change after decided once and soft one like distribution route possible to change somewhat according to the demand fluctuation. Then we have developed a method to derive a flexible logistic network design that can cope certainly with the worst case only by changing the distribution routes while keeping the performance at higher level in the nominal case. Moreover, we have given a procedure to carry out parametric computations for trade-off analysis helpful for practical decision making. Through numerical experiments, we confirmed effectiveness of the proposed method.