A Mathematical Model for an Order Management and Production Planning Problem Considering Installation in Hybrid (MTS-MTO) Systems

Document Type : Research Paper

Authors

1 M.Sc. in Industrial Engineering, Systems Optimization Division, Faculty of Industrial Engineering, Iran University of Science and Technology, Tehran, Iran

2 Professor, Systems Optimization Division, Faculty of Industrial Engineering, Iran University of Science and Technology, Tehran, Iran

10.22084/ier.2025.30418.2193

Abstract

With the increasing diversity of customer demands and the dynamic changes in supply chains, hybrid production systems (MTS-MTO) have emerged as a strategic solution for balancing mass production and customization. This study presents a bi-objective mathematical model aimed at maximizing system profit and minimizing customer dissatisfaction in a hybrid production environment. The proposed model integrates the simultaneous production of MTS and MTO products while considering production capacity constraints and shared resources. A key feature of the model is the inclusion of the installation and commissioning process for products, providing a comprehensive approach to production planning and process execution. The model was implemented in a case study of an industrial hoist manufacturing company. Results indicated that with increasing demand, system profit improved; however, customer dissatisfaction also grew significantly due to production and installation capacity limitations, leading to rejected orders and lost sales. Additionally, under high demand conditions, a greater focus on MTS products enhanced productivity in this segment but reduced the system's ability to fulfill MTO orders. The findings underscore the importance of precise production planning, improved capacity management, and increased flexibility in addressing demand fluctuations. The proposed model serves as an effective tool for decision-makers to enhance productivity and customer satisfaction in hybrid production environments and can be utilized as a framework for improving production systems across various industries.

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References

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Journal of Industrial Engineering Research in Production Systems
Volume 12, Issue 25
March 2025
Pages 137-153

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