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Summary: Dynamic Capacity Acquisition and
Assignment under Uncertainty
Shabbir Ahmed
and Renan Garcia
School of Industrial & Systems Engineering
Georgia Institute of Technology
Atlanta, GA 30332.
March 29, 2002
Abstract
Given a set of m resources and n tasks, the dynamic capacity acquisi-
tion and assignment problem seeks a minimum cost schedule of capacity
acquisitions for the resources and the assignment of resources to tasks,
over a given planning horizon of T periods. This problem arises, for
example, in the integrated planning of locations and capacities of distri-
bution centers (DCs), and the assignment of customers to the DCs, in
supply chain applications. We consider the dynamic capacity acquisition
and assignment problem in an environment where the assignment costs
and the processing requirements for the tasks are uncertain. Using a sce-
nario based approach, we develop a stochastic integer programming model
for this problem. The highly non-convex nature of this model prevents
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