Title: Understanding the Effectiveness of Sparse Process Flexibility
Speaker: David Simchi-Levi, Professor of Engineering Systems, MIT
Abstract:
In this talk, we review new theory that explains the effectiveness of sparse flexibility design in
any finite size manufacturing network. Under stochastic demand, we establish two fundamental
properties of sparse designs, a supermodularity property and a decomposition property. These
properties are then used to provide the first theoretical justification for several well-known
observations in the process flexibility literature, and to derive new insights into designing
flexible processes in large systems. Under worst-case demand, we propose the plant cover index
and establish its relation with the worst-case sales. Applying this relation, we demonstrate the
effectiveness of a certain sparse design, called the long chain. Finally, we discuss the
combination of process flexibility and strategic inventory as an effective disruption mitigation
strategy.