A benders stochastic decomposition approach for the optimization under uncertainty of inventory control considering periodic review policy

Placido, F and Pinheiro De Oliveira, F 2015, 'A benders stochastic decomposition approach for the optimization under uncertainty of inventory control considering periodic review policy', in SBPO 2015 - XLVII Simpósio Brasileiro de Pesquisa Operacional, 2015, Porto De Galinhas, Brazil, 25-28 August 2015, pp. 1391-1402.


Document type: Conference Paper
Collection: Conference Papers

Title A benders stochastic decomposition approach for the optimization under uncertainty of inventory control considering periodic review policy
Author(s) Placido, F
Pinheiro De Oliveira, F
Year 2015
Conference name XLVII SBPO 2015
Conference location Porto De Galinhas, Brazil
Conference dates 25-28 August 2015
Proceedings title SBPO 2015 - XLVII Simpósio Brasileiro de Pesquisa Operacional, 2015
Publisher Brazilian Society of Operational Research
Place of publication Brazil
Start page 1391
End page 1402
Total pages 12
Abstract This paper presents the application of a decomposition scheme for a problem of inventory control of one echelon, one item, uncertain demand and based on a (R, S) replacement policy using twostage stochastic programming, as originally proposed by Cunha et al. (2014). We proposed two methodologies, one based on L-shaped (Van Slyke & Wets, 1969), and the other, based on multicut L-shaped (Birge & Louveaux, 1988), for accelerating the computational solution process. The results showed that both proposed methodologies are capable to satisfactorily improve the solution process in terms of computational time. However, despite the fact that the single-cut method always required more iterations than the multi-cut version to obtain optimal solutions, the single-cut presented better performance in terms of computational time, especially when large number of scenarios and periods are considered.
Subjects Operations Research
Optimisation
Keyword(s) L-shaped method
two-stage stochastic programming
inventory control
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