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  <front>
    <journal-meta />
    <article-meta>
      <title-group>
        <article-title>Generation of predictive configurations for production planning</article-title>
      </title-group>
      <contrib-group>
        <contrib contrib-type="author">
          <string-name>Tilak Raj Singh Production Tools</string-name>
          <email>narayan.rangaraj@iitb.ac.in</email>
          <xref ref-type="aff" rid="aff0">0</xref>
        </contrib>
        <contrib contrib-type="author">
          <string-name>Mercedes-Benz R</string-name>
          <xref ref-type="aff" rid="aff0">0</xref>
        </contrib>
        <contrib contrib-type="author">
          <string-name>D Bangalore tilak.singh@daimler.com</string-name>
          <xref ref-type="aff" rid="aff0">0</xref>
        </contrib>
        <aff id="aff0">
          <label>0</label>
          <institution>Narayan Rangaraj Industrial Eng. &amp; Operations Research IIT Bombay</institution>
          ,
          <addr-line>Mumbai</addr-line>
        </aff>
      </contrib-group>
      <pub-date>
        <year>2013</year>
      </pub-date>
      <fpage>29</fpage>
      <lpage>30</lpage>
      <abstract>
        <p>We provide a production planning framework for variant rich customized products (such as automobiles, computers), by calculating entirely constructible configuration sets for future customer demands in a novel manner. Most of the established approaches analyse configurations out of historical order banks for estimating the appropriate set of future demands. In the current environment of rapidly changing designs and highly customized products, historical demands cannot easily be extrapolated to capture future market demand and may not even retain future product document restrictions. In this paper, our aim is to generate configuration sets such that (1) they represent customers buying behaviour (derived from configurations produced in the past and sales planning at aggregate level) (2) they are consistent with the product documentation. Configuration generation is formulated as guided search procedures which utilize the Satisfiability framework. Selection of configuration sets for planning is done by a large scale optimization model. We use column generation and other techniques to solve this large scale optimization model.</p>
      </abstract>
    </article-meta>
  </front>
  <body>
    <sec id="sec-1">
      <title>-</title>
      <p>In the customer focused order-fulfilment strategies such as
Built-To-Order and Assemble-To-Order, mid to long term (6
months - 3 years) planning activities in production and
logistics are supported with aggregate level of forecast from
sales and marketing. Through sales forecast it is possible to
get estimate of total volume for entire product line. In
addition to this we get demand estimates for key attributes of
the product [Srinivasan and Swaminathan, 1997]. For
example, in case of automotive, attributes can be engine type, body
style, air condition, and so forth. During the estimation
demand characteristics of future customers, the dependencies
between attributes and components provided by designers or
customers may not have been considered [Olsen and Saetre,
1997]. Component dependencies by design can be found in
product documentation and these will be reflected in the
BillOf-Material system [Kaiser and Ku¨chlin, 2001].
Dependencies from customer point of view may not be straightforward
but these can be extracted from variants produced in the past.
The important thing to note is that these dependencies change
with continuous changes in the design (introduction of new
feature, parts or components) and because of changing
market, legislation and economic conditions.</p>
      <p>Starting from sales planning inputs, the primary task of the
production program planning activities is to know which parts
and components need to be available at what time and in what
amount, in order to produce the planned product units
efficiently? This has to be done even when the company has not
received any real customer orders.</p>
      <p>The derivation of part demand or workload at any
assembly station may not be straightforward from the sales
planning inputs. For example, one might get information from
sales forecast that attribute parking assistance system and
automatic lane departure system will be used in 50% and 40% of
the cars respectively. This information may not be enough for
calculation of the demand for a specific steering wheel.
Selection of steering wheel may depend on if both attribute are
selected together or individually. Assume that there is one
steering wheel that will be used if both the above attributes
are selected in the same configuration. From the sales
planning as an independent forecast for attributes, the demand of
this specific steering wheel may lie between 0% to 40%.
Consequently, without additional assumptions, we cannot
determine demands of all parts required for order fulfilment.</p>
      <p>As shown in Figure 1 there is a need to build a medium
which can transfer consistent information across various
departments involved in the customer order processing to enable
better program planning. One way to achieve this is by
planning with fully specified customer configurations. As
customer configurations are not available for mid to long term
planning, most manufacturers use variants produced in the
past to estimate the appropriate set of future demands. Due to
the introduction of engineering changes and shifts in market
expectation, variants produced in the past become statistically
less significant to capture future customers demand
characteristics. Also, engineering changes in the product make some
configurations obsolete and cannot be re-produced exactly.
Thus, simple extrapolation of historical demands to capture
future demands characteristics may cause information
distortion in the early stage of the production planning.</p>
      <p>Our main aim in this paper is to provide an automated
framework to supplement the historical configurations set in
such a way so that the underlying configurations set can be
more relevant to capture future demand characteristics. Once
the desired configurations are generated we will select a target
number of configurations to propose a production plan. The
main challenge in defining future configurations of the
product is that the solution space is huge (an enormous number of
configurations are technically feasible). We will propose an
integrated configurations generation and selection approach
that will calculate only a few (as compared to the full solution
space) configurations to complete the set of base
configurations set for planning. In our work, we will argue that by
considering sales estimates, engineering dependencies,
production restriction and customer buying behaviour during
configuration generation, the number of valid configurations can
reduce significantly.</p>
      <p>The rest of the paper is structured in following way: We
will present a review of literature in Section 2 to motivate the
need and use of product configurations in various planning
activities across the organization. In Section 3 we will present
formal problem descriptions with input data and their
characteristics. In Section 4 we will discuss a heuristic for
generating configurations directly from product documentation (i.e.
the engineering document). The mathematical model
building and solution methodology will be discussed in Section 5.
Section 6 will describe initial computational experiments on
industry size examples.
2</p>
    </sec>
    <sec id="sec-2">
      <title>Literature Review</title>
      <p>To manage product variety in mass customization techniques
such as product differentiation and postponement are well
studied approaches, offering flexible manufacturing for high
variety product [Harrison et al., 2004]. The basic idea is to
design and manufacture the product in such a way so that
variety can be introduced at the last stage of the production. The
partially assembled standard products are produced till the
point no differentiation is required. Final assembly is done
based on customer configuration by adding specific product
features. The work in progress (WIP) inventories are
maintained to offer customer attractive lead time with required
variety [Swaminathan and Tayur, 1998]. For a manufacturer
who follows lean manufacturing or Just-in-Time (JIT)
approaches, any kind of inventory either of individual parts or
components or as a WIP is highly undesirable. As product
technology and design changes continuously with respect to
time, it might be difficult and costly to introduce variety at
the end of the production.</p>
      <p>Product configuration system has been a key enabler of
mass customization by capturing the customer demand in
most consistent way. Although, initial focus of
configuration system was to provide significant reduction in customer
order response time by enabling customer-product interface
[Salvador and Forza, 2004]. As the customer order fulfilment
process varies based on the product configurations, there is a
need to utilize configurations technique in various planning
and process design [Aldanondo and Vareilles, 2008]. Product
configurations act as a medium to translate information
between customer, sales, manufacturing and other supply chain
players. For example maintaining consistent bill-of-material,
or finding range of product with certain characteristics
[Astesana et al., 2010].</p>
      <p>By utilizing product configurations in the early stage of
planning hybrid order fulfillment strategies such as
VirtualBuild-to-Order (VBTO) system can be created [Brabazon and
MacCarthy, 2004]. The fundamental capability for a VBTO
system is the ability to search the order fulfilment pipeline
on behalf of the customer. These virtual (not created by end
customer) configurations can be reconfigured with respect to
actual customer configuration with minimum difference from
customer preference. At the end, efficiency of systems such
as VBTO mainly depends upon the correlation between the
planned and real orders. If we are able to simulate
configurations according to customers need, then we will get high
level of satisfaction and smooth processes in customer order
fulfilment.</p>
      <p>It has been agreed in literature that efficient configuration
system which co-ordinates and covers information from all
available sources (e.g. sales, marketing, assembly, logistics,
design, and customers) leads to significant gain in customer
order fulfilment process [Trentin et al., 2011]. However, most
of the efforts in the past are devoted to use product
configurations for reducing the lead time and maintaining customers
buying behaviour. The generation of configurations has
received considerably less attention. Hayler [Hayler, 1999]
developed a sequential procedure for generating product
configuration from rule based system. Products attribute classes
(levels) are created and each virtual configuration selects
attribute based on its forecast rates. The approach can be
compared as a product configurator system. A product
configurator is created form rule based design document. Selection
of attribute from each step of configuration is supported by
attributes selection rate, historical orders, association rules
and experts experience. These permutation procedures
often hamper the result quality and require manual intervention
to match desired output. Stautner [Stautner, 2001] discussed
configuration generation problem by identifying
configurations form recent history through cluster analysis. Historical
orders are modified in such a way so that it can fit in future
planning requirements. The method involves manual
procedure to create final configurations. In case of new product
such as electric or hybrid cars which open new market
segments for manufacturer and does not have customer history.
The current available methods find difficulties in generating
future product congfiuration which matches given input
requirements from design, sales and production.
3</p>
    </sec>
    <sec id="sec-3">
      <title>The planning problem</title>
      <p>The major aim of this paper is the development of an
automated procedure that supports production planning, part
demand calculation and capacity management for the short-term
as well as for a medium-term planning horizon up to two
years from the start of production.</p>
      <p>As discussed in the introduction, in a customer oriented
production environment, planning may be done at an
aggregate level such as modules or attributes. One problem in
this method is that engineering constraints between attributes
may not be taken into consideration. For example, selection
of front bumper in the car may depend on body style type,
headlamp, and optional feature and sensor mounted on the
bumper. Drawing estimates of future bumper demand
without consideration of such dependencies may give unreliable
estimates.</p>
      <p>This problem can be avoided if planning is based on
complete products. However, drawing a small number of
representative configurations from an enormously large set of
possible configurations is a daunting task. One way to attack
this problem is by utilizing customers demand in the past.
Customer order history is an important input for capturing
customer buying behaviour, required for future planning
activities. In Figure 2 the planning tasks related to logistics and
assembly are derived through extrapolation of configurations
produced in the past. Once the fully specified configurations
are known, assembly related processes can be optimized for
the selected production program. From the logistics point of
view, the most important outcome is the calculation of part
demand, which is straightforward, once the product
configurations are known. This method works only if the underlying
configurations are able to fit with future demand
characteristics.</p>
      <p>Futurekdemandk
chracteristics
Knownk
configurationsk
poolk(Demandk Not consistent with:
inkthekpast) - Future product documentation
- Future market estimates
-Future production restrictions</p>
      <p>Derivedk
Configurationk configurationsk</p>
      <p>Selectork setkfork
planning</p>
      <p>Production
Masterk
data
Bill of
material
(BOM)
-kAssemblyklinekoptimization
-kWorkkloadkcalculation
-kPeakklinekplanning</p>
      <p>Assembly
station station station</p>
      <p>Logistics
-Part-rateskforksuppl-y
chain-control
-Supplierkselection</p>
      <p>Variant rich products (e.g automobiles) often receive
highly individualized demand and undergo various
engineering changes. The regular introduction of new features and
short product life cycle make the task of capturing future
demand characteristics out of production history a challenging
one. In order to facilitate orders/configurations based
planning we need to supplement the reference pool of
historical production with some customer focused future
configurations. To attain planning results of high quality, all the
relevant information sources have to be considered, namely the
valid list of the product features/attributes, rules for the
correct combinations of the attributes, sample of variants
produced in the past to capture customers’ behaviour, future sales
estimates to capture market changes, capacity restrictions and
production plans that fix the total number of planned vehicles.</p>
      <p>Product/
documentation
Production/Assembly/restrictions
Sales/estimates/
for/demand/in/
future</p>
      <p>Customer/
buying/behaviour/
5Derived/from/
historical/demandv</p>
      <p>Integrated/
configurations/
selection/T/
generation</p>
      <p>Initial/
Configurations/</p>
      <p>Generation/
5Section/4v
The/Optimal
Configurations/</p>
      <p>Selector
5Section/5v</p>
      <p>Production
Master/
data
Consistent/and/</p>
      <p>realistic/
configurations/
for/planning</p>
      <p>Bill-of
-material
-/Assembly/line/optimization
-/Work/load/calculation
-/Peak/line/planning</p>
      <p>Assembly
station station station</p>
      <p>Logistics
-Part-rates/for/supplychain-control
-Supplier/selection</p>
      <p>We propose a different planning set up to generate and
select reference configurations for production planning. The
main difference between the current (Figure 2) and the
proposed methodology (Figure 3) is that current planning is
restricted to create production programmes out of known
configurations only, while in the proposed approach, we will
generate product configurations as and when required, to
capture future demand characteristics. This will result in a
better match with market estimates and will be consistent with
the engineering limitations. Configurations produced in the
past can only appear in future planning if they are feasible
with latest product documentation. Attributes dependencies
in product documentation are maintained formally to support
various engineering planning and can be used to
automatically check the configurations feasibility. However, historical
orders even after failing overall feasibility may contains some
important relations among attributes reflecting customer
buying habits. For this purpose we will use a data mining
approach to identify interesting attribute combinations from the
customer point of view, using historical sales data.</p>
      <p>The goal of the paper is as follows. Given 1) product
documentation 2) market estimates 3) customer behaviour and 4)
assembly restrictions, the task is to generate and select valid
configurations, which will lead to a production plan. The
set of product configurations that are generated is utilized in
planning the whole production process (full bill of material,
i.e. a car in detail). The optimal configuration selector model
(proposed in section 5.2) does not explicitly generate all (or
a large number) configurations while it generates a
relativity small number of configurations to sequentially build up
the desired production plan. The initial configuration
generation module (proposed in section 4) is used to provide a
starting solution to the optimization model. Although, the
optimization based module is able to generate and select
configurations, an initial solution from heuristics will give a good
starting point. Before describing the development of the
solution methodology we list out important data sources and its
characteristics.
3.1</p>
      <sec id="sec-3-1">
        <title>Product Documentation</title>
        <p>Product documentation is the most important input data for
proposed framework and supplies two main sources of data:
1. List of available attributes of the product. For
autmobiles, attributes can be power train, Hi-Fi equipment,
parking assistant package, etc. Attributes also include
labels or user manuals, which may not be crucial for
planning but which are required during the creation of
an automated framework for production planning such
as automated computation of detailed part demand.
2. Rule for feasible combinations of attributes in the
configuration. Product configuration can be defined as a
list of selected attributes from given set of available
attributes. Customer configurations can be produced by
combining different attributes all together which are
permitted by product documentation. It is important that
while combining different attributes, we must fulfil the
interdependencies between attributes, so that the
feasible product configuration can be generated [Sinz et al.,
2003]. For instance, in the USA, some engines required
special transmission types, this condition must hold
during creating configuration with that particular engine.</p>
        <p>Interdependencies among attributes are documented and
maintained in the product technical document by a rule
system. These rules are basically propositional Boolean
formulas imposed against each attribute. These formulas are
limited to logical operations ∨(OR), ∧(AND), ¬(NOT).
Selection of attributes in a configuration is done through evaluating
the respective Boolean formula. Table 1 shows an example of
such documentation.</p>
        <sec id="sec-3-1-1">
          <title>Attribute</title>
          <p>1
2
3
4</p>
        </sec>
        <sec id="sec-3-1-2">
          <title>Rule</title>
          <p>(2)∧(3∨4)</p>
        </sec>
        <sec id="sec-3-1-3">
          <title>Name</title>
          <p>Automatic
climate
control
Air
condition
Comfort ¬(4)
package
Performance ¬(3)
package</p>
          <p>TRUE</p>
          <p>Description
attribute 1 only
when attribute 2 is
present and either
attribute 3 or 4 is
present
must be present in
every variants
attribute 4 should
not be present
attribute 3 should
not be present</p>
          <p>The customer order processing is controlled by evaluating
the rule’s formulae under the variable assignment induced by
the customer order and executing suitable action based on
whether the formula evaluates to TRUE or FALSE. [Sinz et
al., 2003] have presented a detailed description of one such
product documentation; we will use a similar kind of product
documentation in this paper. Product documentation describe
product in flat structure over attributes (Boolean variables)
and capture dependencies through propositional Boolean
formulas.
3.2</p>
        </sec>
      </sec>
      <sec id="sec-3-2">
        <title>Future market estimates</title>
        <p>Sales and marketing departments continuously study the
market behaviour and product positioning. This study enables
them to give some demand estimates on key attributes of
future products, which any way need to be calculated accurately
for various marketing and vendor negotiation purposes. We
assume that this information is available to us as an input to
capture future market behaviour. We aim to generate
configurations sets which represent the given estimates of attributes
in the best possible way.
3.3</p>
      </sec>
      <sec id="sec-3-3">
        <title>Assembly/ Production estimates</title>
        <p>Product assembly is an important step in customer order
fulfilment. Assembly is often restricted to be done on a number
of predefined stations with certain work functions at each
station. There are some limitations on the capacity and workload
at each station. Due to these restrictions, order fulfilment can
only be achieved for configurations that satisfy these
restrictions. From the aggregate production plan, the total number
of planned vehicles can be estimated and the final production
plan is generated with the estimated number.
3.4</p>
      </sec>
      <sec id="sec-3-4">
        <title>Customer behaviour</title>
        <p>Customer buying trends are extracted by analyzing the
product variants produced in the past. We first check the
feasibility of variants that are already produced with respect to new
product documentation rules. All feasible configurations will
be candidates in the solution space. Nevertheless,
configurations which are not feasible due to some engineering changes
are analyzed on the level of attributes relations. We use the
association rule mining technique to identify customer
buying behaviour. All relations derived from the data mining
approach are again verified with latest product
documentation for its feasibility. Customer demand characteristics are
calculated as joint or conditional selection rate of attributes,
and these are controlled during the development of final
production plan. The computation of customer behaviour trends
from historical demand is not discussed in this paper and we
assume that this information is already available as an input.
4</p>
      </sec>
    </sec>
    <sec id="sec-4">
      <title>Configuration Generation</title>
      <p>Configuration which satisfies rules from product
documentation can be represented as Boolean vector satisfying a
constraint system. We want some number of configurations
which satisfy product’s technical rules and are consistent with
customers demand estimates in some way. e.g. we want N
configurations which reflects customer demand estimates as
best as possible.</p>
      <p>As a first step we would like to generate valid
configurations which can be use latter for some optimization
problem. Generation of configuration involves finding TRUE or
FALSE assignment for each attribute. In this section we will
propose a guided search procedure which randomly generate
configuration with some attribute selected in guided way and
others then supplemented as per attribute selection rates form
sales. Finally we solve a satisfiability problem with partial
assignment of attributes. The satisfiability problem will result
selection of generated configuration with some probability.
1.-List-of-attributes
2.-Product-documentation
3.-Sales-esmimates
4.-Customer-behaviour
Selection-of-attributesand-group-of-attributes
-based-on-sales-estimates</p>
      <p>Y
-customer-behaviour
is-configuration
-complete?</p>
      <p>NO
NO
is-itfesible?</p>
      <p>YES</p>
      <p>StoreConfiguration
--Get-simplified-rules
--Construct-a-smallSAT-problem</p>
      <p>SAT?</p>
      <p>NO</p>
      <p>YES
Nextiteration?</p>
      <p>NO
Stop
Figure 4 shows a flow diagram of building configurations
sequentially. Selection of an attribute in the configuration
may exhibit certain characteristics such as mutually
exclusivity. For mutually exclusive attributes selection should be
done through a multinomial choice. In general, the numbers
of possible configurations in mass customization are huge.
This motivates us to build a random search procedure to get
a representative set of constructible configurations. In
principle, first we arrange attributes (or group of attributes) in the
decreasing order of their dependency index. The dependency
index can be calculated by analysing the selection rule
associated with the attribute. The attributes/group which has
highest dependency will be selected first and will imply selection
(not selection) of other dependent attributes. We will
continue to do this process until all attributes assignment is not
known. At the end we will check if generated configuration
is feasible through evaluating rules with known configuration
vector.</p>
      <p>As soon as any attribute is selected in the configuration,
we check the respective propositional Boolean formula (from
product documentation) and select unassigned attributes from
Boolean formula such that formula evaluates to True. This
will keep some level of consistency during the
configuration building process. We iterate through this process until
a conflict or a steady state where no assignment is possible
is reached. If the configuration finds assignment for all
attributes, we finally check the overall feasibility of the
configuration by evaluation all rules once again. The configuration
will be selected with some probability of having a feasible
configuration.</p>
      <p>If the initial configuration is not able to extract all attributes
assignment, we simplify all propositional Boolean formulas
with known partial attribute settings and solve a satisfiability
problem. Due to assignment of large number of attributes,
the number of clauses and literals in satisfiability problems
are minimized significantly. If the problem is not satisfiable
we reject the configuration and start building a fresh
configuration. The configuration generation runs until maximum
number of iterations is reached or generated set of
configurations is within specified range of attributes estimates.</p>
      <p>The randomness in the configuration generation procedure
will help in creating diversified configurations that will
capture the customer behaviour of individualization in variant
rich product. On the drawback side, there will not be any
guarantee that the characteristics of generated configurations
will improve with number of iterations. This lead us to
think about a framework which selects generated
configuration such that the target configurations set characteristics can
be match as best as possible. At same time, the framework
should also be able to generate missing configurations so that
characteristics of the final set of configurations can be close
to the target one. In the next section we discuss an integrated
configurations generation and selection procedure.
5</p>
    </sec>
    <sec id="sec-5">
      <title>Integrated configurations generation and selection</title>
      <p>Heuristic approach discussed in section 4 does not provide
answers for questions like 1) How many constructible
configurations will be generated from the configuration generation
heuristic? 2) How good the deviation between target and
generated set of configurations will be? Although, approach can
give a reasonable set of constructible configurations in short
period of time this can be used as a starting solution for
further optimization process. Based on the quality of starting
solution the optimization model can generate missing
configurations to complement reference configurations set. To
facilitate optimization based approach for generation and selection
of configurations we will first transform Boolean propositions
from product documentation to a constraints system.
5.1</p>
      <sec id="sec-5-1">
        <title>Transformation of logical rules to linear inequalities</title>
        <p>Linear inequalities over Boolean variables are a widely used
modelling technique. The main task during transformation of
an attribute selection rule into a system of linear constraints
is to maintain the logical equivalence of the transformed
expressions. The resulting system of constraints must have the
same truth table as the original statement. For every attribute
we will introduce an the binary decision variable, is denoted
by yi. The connection of these variables to the propositions
is defined by the following relations:
yi =
Imposition of logical conditions linking the different actions
in a model is achieved by expressing these conditions in the
form of linear constraints connecting the associated decision
variables. Some general transformations are presented in
Table 2.</p>
        <p>Our approach, in principle, involves identification of
precise compound attribute rules of the problem and then
processing it with developed equations. Before transformation,</p>
        <p>Rule
i → j
i ↔ j
i → (j ∨ ... ∨
n)
i → (j ∧ ... ∧
n)</p>
        <p>Description
i implies j
i and j must come
together
if i is true then at least
one attributes from j to
n, must be true
if i is true then all
attributes from j to n (say
cardinality p) must be
true</p>
        <p>Constraints
yi − yj ≤ 0
yi − yj = 0
yi −(yj +...+
yn) ≤ 0
(p)yi − (yj +
... + yn) ≤ 0
we simplify Boolean expression through simple Boolean
algebra, DeMorgan’s Law. The logical rule is represented by a
tree graph where attributes are associated with their common
operator node. We traverse through the tree and prune the
tree in such a way so that standard transformation equation
(e.g. Table 2) can be applied. This pruning involves
introduction of new auxiliary variables which helps in transformation
process.</p>
        <p>B[y] ≤ b
As a result of transformation linear constraints sets are
created as specified in Eq.2, where B is the constraint matrix
contains all constrains originating from product
documentation. All product configurations must satisfy Eq.2 in order to
be feasible for production and can be a candidate for
production plan.
5.2</p>
      </sec>
      <sec id="sec-5-2">
        <title>The optimal configuration selection model</title>
        <p>To create production plan based on detailed product
configuration we need to list out some number of configurations (say
K) in such a way that estimated characteristics of
configurations can be match as best as possible. For example, let us
assume that an automotive contains 1000 of attributes and we
want to select 3000 configurations generated from available
attributes. Our task will be to answer, does attribute i
belong to the configuration j finally selected? This example will
leads to s3 millions (a large number) of 0-1 type decision
variables. We do know something about the portion of attribute
(i’s) in the nfial configurations (demand estimates from sales,
customer behaviour etc.). So the objective function will be
to minimize the positive deviation between selected and
estimated values. General structure of above problem is defined
over combinatorial optimization, with a very large number of
variables that is quite difficult to solve.</p>
        <p>Another possibility of formulation for given problem is
to list all possible configurations with the given number of
attributes. This runs into the hundreds of millions! Much
larger than the previous formulation. We can define 0-1
variable over each configuration on whether it is selected
or not. These feasible configurations has to be implicitly
represented, i.e. not possible to list all of them explicitly.
Surprisingly, this way of thinking is still useful. In this
section we will develop an optimization model based on
Lagrangian approach using column generation.</p>
        <sec id="sec-5-2-1">
          <title>The Master Problem:</title>
          <p>Let: i be ith attribute, i ⊆ {1...I}, where I is the number of
attributes
j be jth configuration, j ⊆ {1...J }, where J is the number of
unique configurations</p>
        </sec>
        <sec id="sec-5-2-2">
          <title>Data</title>
          <p>K = the number of configurations planned
Di= Demand estimate for attribute i
Ci= Demand mismatch cost associated with attribute i
λ= Lagrange multiplier</p>
          <p>1 if ith attribute is present in jth configuration
Ai,j = 0 otherwise</p>
        </sec>
        <sec id="sec-5-2-3">
          <title>Decision variables:</title>
          <p>Xj =
to attribute demand estimates. Each attribute is associated
with a demand mismatch cost. We fixed Xj to 0-1 type to
support higher degree of individualization in the generated
plan.</p>
          <p>The above model is too large to solve by explicitly
generating large number of configurations. A solution for such a
large scale optimization can be found using column
generation approach [Ben Amor and Valrio de Carvalho, 2005]. We
can start with a possible set of Xj variables (may be more
than K, generated from Section 4 or derived from history)
Solving LP relaxation of the above problem to decide which
of those Xj ’s are 1, and then try generate a new configuration
which can improve the objective function value.</p>
        </sec>
      </sec>
      <sec id="sec-5-3">
        <title>5.3 Implementation of the model</title>
        <p>To start solving the model presented in Section 5.2 we
use a fixed value of λ (this is because anyway we want
approximately K configurations that are representative of
the demand). Now we can solve the master problem with
initial sets of Xj ’s. The question would be how to know if
the current selection of configuration is good. For this, we
will compute dual variable corresponding to constraints 4-5,
with these values a sub problem is set up. The sub problem
is basically a generation of new configuration for Aij matrix
which can be formulated as follows:</p>
        <sec id="sec-5-3-1">
          <title>The Sub-Problem:</title>
          <p>Data: Wi= Dual variable from LP relaxed of the
optimal configuration selection model (5.2), associated with
constraints 4-5 (note that for each i, one of them will be
non-zero)
B= Set of constraints derived from product document (see
Section 5.1)
Decision Variable
if ith attribute is present in new configuration
otherwise
[yj ]i= new configuration for
tion matrix Ai,j
jth column of
configura</p>
        </sec>
        <sec id="sec-5-3-2">
          <title>Objective:</title>
          <p>subject to:</p>
          <p>Maximize X</p>
          <p>Wi ∗ yi
i</p>
          <p>B[y] ≤ b
(i.e. y is a feasible configuration)</p>
          <p>yi = 0 or 1 (9)
The sub-problem is generate a possible new configuration j.
If this new configuration j satisfies Eq. 10 the configuration
j enter the pool.
i i
Dual costs are recomputed by solving the master problem
(Section 5.2) and the process terminates when no more
configurations are found to be worth taking in. We use IBM
(7)
(8)
(10)
ILOG Cplex engine to solve the sub-problem. The master
and the dual problem may have to be solved multiple times
before terminating criteria satisfies.
6</p>
        </sec>
      </sec>
    </sec>
    <sec id="sec-6">
      <title>First evaluation results</title>
      <p>In this section we discuss typical computation parameters and
associated numbers with input data and decision variables.
We tested our methods mainly on automotive data, for
configuration based planning the granularity of the computation is
plant/model series/body style (e.g. Bremen, C-class, Sedan).
All input data and estimates are available or derived to same
granularity. Total number of attributes are in the range of
500-1000. Typically selection rates of 100-200 key attributes
are estimated from sales. Some attributes are related to
production such as plant where production takes place, regularity
laws, dependencies structure because of technical reason.</p>
      <p>We target to generate production plan for weekly or
monthly time frame and requite to simulate some thousand
of configurations, typically 3-10 thousands of configurations
in one computation. The generation of production plan with
thousands of configuration need to be done by ensuring
maximum correlations with given demand characteristics (e.g.
sales estimates). The typical use of calculated configurations
is to derivation of part demand or estimation of medium term
workforce in assembly operations.</p>
      <p>On an example with 130 attributes (for which attached
selection rates are given), 900 total attributes and selection of
about 3000 configurations, resulting problem has 10,000
variable and 15,000 constraints. The match between the target
and achieved frequency of attributes in generated
configuration set is defined by the ratio of target and gain frequency of
attributes. If this ratio is equal to one, it is desirable.</p>
      <p>Figure 6 provides comparison between results obtained
after configuration generation heuristic (Section 4) and
optimization based procedure (Section 5). The grey (light) line
represents the best solution of the optimization model, which
is very close to 1. The result from the configuration
generation heuristic is plotted in a decreasing order of deviation
from the target rate (in blue). We can see that some of the
attributes are more than required and some less, but many
are quite close to the desired target. This can perhaps be
improved further in the satisfiability section of the algorithm,
which allows different heuristic ways of completing orders.</p>
      <p>In general, the heuristic provides a starting solution for our
optimization model and helps in speeding up in the process
of generating a configuration set for planning. The attribute
selection rate obtained in generated configuration set matches
reasonably with the target attribute demand.</p>
    </sec>
    <sec id="sec-7">
      <title>Conclusion</title>
      <p>In this paper we presented a production planning framework
based on fully specified products which guarantees
consistency among different planning tasks. The mathematical
model that has been developed is capable of considering
heterogeneous information generated by different planning
departments. In this framework we are able to consider
up-todate product documentation at an early stage of program
planning. The problem of find a valid set of configurations is
formulated as an optimization problem by translating all logical
conditions from the product document to algebraic
inequalities. This transformation enables us to use the optimization
framework effectively. The number of constraints generated
during this transformation can be further reduced by
simplifying the product rule system or through pattern identification
in the product documentation.</p>
      <p>The large variety in products implies that the construction
of the set of customer-focused configurations is a large scale
optimization problem. Our proposed column generation
approach can be useful to get a good solution for this problem.
The configuration generation heuristic is based on the guided
search procedure that can be enhanced further to gain better
speed and improve the result quality. Some other parameters
like restrictions at the part level and assembly operation level
are subjects of future research.
Managing product variety through postponement:
Concept and applications. In Frederick S. Hillier, editor, The
Practice of Supply Chain Management: Where Theory and
Application Converge, volume 62 of International Series
in Operations Research and Management Science, pages
139–155. Springer US, 2004.</p>
    </sec>
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