An integrated production and distribution scheduling approach for exceptions handling

In an international competitive environment, where companies can sell their products all over the world, coordination with other companies is of utmost importance, as a means to obtain an optimal utilization of their own resources and a competitive advantage over other supply chains. Nevertheless, in real world, most businesses are reluctant to share demand information or future plans with others, even if they belong to the same supply chain, the reason being that most of them see any other company as a potential competitor. This paper describes the architecture of an integrated approach for dynamic production and distribution scheduling in a supply chain with three levels; i.e., a company, its suppliers, and customers. This architecture tries to provide solutions to improve the performance of the supply chain by identifying the information that must be exchanged between nodes and developing methodologies for dynamic production and distribution scheduling in a coordinated manner. Moreover, a number of exceptions have been considered, both in production and distribution, to make the model as realistic as possible. Finally, the paper focuses on the distribution stage, where the problem is presented as a Dynamic Vehicle Routing Problem with Time Windows and Backhauls. This research is part of the PRODIS project (Grant PI2011-58, funded by the Basque Government in Spain).