Product allocation and network configuration in global production networks

Abstract Driven by an increasing demand for individualized products and shorter product life-cycles, companies continuously extend their portfolio. Simultaneously, expand into new markets to reach customers exploit varying location factors reduce costs. Global production networks (GPNs) have be adapted constantly react circumstances changes in the of products. To remain competitive, allocation network configuration are essential. At same time, face complexity while handling these tasks. This poses a challenge particularly small medium sized companies, which limited planning capacities management resources. Current literature describes optimization-based approaches integrated networks. Yet, multi-objective models lack transparency results user friendliness. Therefore, this paper presents optimization model that incorporates flexibility reconfiguration aspects determine optimal GPN over given horizon. The preemptive goal programming approach is used identify Pareto-optimal solutions increase subsequent verification, validation post-optimality analysis combined structured process enables wide range apply approach. successfully applied special machine manufacturer, produces high precision metrology machines. Due its transparent complex problems, developed method provides solid base well-founded, objective decisions. Hence, risk costly errors phase reduced.