Four payment models for the multi-mode resource constrained project scheduling problem with discounted cash flows

In this paper, the multi-mode resource constrained project scheduling problem with discounted cash flows is considered. The objective is the maximization of the net present value of all cash flows. Time value of money is taken into consideration, and cash in- and outflows are associated with activities and/or events. The resources can be of renewable, nonrenewable, and doubly constrained resource types. Four payment models are considered: Lump sum payment at the terminal event, payments at prespecified event nodes, payments at prespecified time points and progress payments. For finding solutions to problems proposed, a genetic algorithm (GA) approach is employed, which uses a special crossover operator that can exploit the multi-component nature of the problem. The models are investigated at the hand of an example problem. Sensitivity analyses are performed over the mark up and the discount rate. A set of 93 problems from literature are solved under the four different payment models and resource type combinations with the GA approach employed resulting in satisfactory computation times. The GA approach is compared with a domain specific heuristic for the lump sum payment case with renewable resources and is shown to outperform it

A survey of variants and extensions of the resource-constrained project scheduling problem

The resource-constrained project scheduling problem (RCPSP) consists of activities that must be scheduled subject to precedence and resource constraints such that the makespan is minimized. It has become a well-known standard problem in the context of project scheduling which has attracted numerous researchers who developed both exact and heuristic scheduling procedures. However, it is a rather basic model with assumptions that are too restrictive for many practical applications. Consequently, various extensions of the basic RCPSP have been developed. This paper gives an overview over these extensions. The extensions are classified according to the structure of the RCPSP. We summarize generalizations of the activity concept, of the precedence relations and of the resource constraints. Alternative objectives and approaches for scheduling multiple projects are discussed as well. In addition to popular variants and extensions such as multiple modes, minimal and maximal time lags, and net present value-based objectives, the paper also provides a survey of many less known concepts. --project scheduling,modeling,resource constraints,temporal constraints,networks

Multiobjective strategies for New Product Development in the pharmaceutical industry

New Product Development (NPD) constitutes a challenging problem in the pharmaceutical industry, due to the characteristics of the development pipeline. Formally, the NPD problem can be stated as follows: select a set of R&D projects from a pool of candidate projects in order to satisfy several criteria (economic profitability, time to market) while coping with the uncertain nature of the projects. More precisely, the recurrent key issues are to determine the projects to develop once target molecules have been identified, their order and the level of resources to assign. In this context, the proposed approach combines discrete event stochastic simulation (Monte Carlo approach) with multiobjective genetic algorithms (NSGAII type, Non-Sorted Genetic Algorithm II) to optimize the highly combinatorial portfolio management problem. In that context, Genetic Algorithms (GAs) are particularly attractive for treating this kind of problem, due to their ability to directly lead to the so-called Pareto front and to account for the combinatorial aspect. This work is illustrated with a study case involving nine interdependent new product candidates targeting three diseases. An analysis is performed for this test bench on the different pairs of criteria both for the bi- and tricriteria optimization: large portfolios cause resource queues and delays time to launch and are eliminated by the bi- and tricriteria optimization strategy. The optimization strategy is thus interesting to detect the sequence candidates. Time is an important criterion to consider simultaneously with NPV and risk criteria. The order in which drugs are released in the pipeline is of great importance as with scheduling problems

Multiobjective strategies for New Product Development in the pharmaceutical industry

New Product Development (NPD) constitutes a challenging problem in the pharmaceutical industry, due to the characteristics of the development pipeline. Formally, the NPD problem can be stated as follows: select a set of R&D projects from a pool of candidate projects in order to satisfy several criteria (economic profitability, time to market) while coping with the uncertain nature of the projects. More precisely, the recurrent key issues are to determine the projects to develop once target molecules have been identified, their order and the level of resources to assign. In this context, the proposed approach combines discrete event stochastic simulation (Monte Carlo approach) with multiobjective genetic algorithms (NSGAII type, Non-Sorted Genetic Algorithm II) to optimize the highly combinatorial portfolio management problem. In that context, Genetic Algorithms (GAs) are particularly attractive for treating this kind of problem, due to their ability to directly lead to the so-called Pareto front and to account for the combinatorial aspect. This work is illustrated with a study case involving nine interdependent new product candidates targeting three diseases. An analysis is performed for this test bench on the different pairs of criteria both for the bi- and tricriteria optimization: large portfolios cause resource queues and delays time to launch and are eliminated by the bi- and tricriteria optimization strategy. The optimization strategy is thus interesting to detect the sequence candidates. Time is an important criterion to consider simultaneously with NPV and risk criteria. The order in which drugs are released in the pipeline is of great importance as with scheduling problems

A bi-objective genetic algorithm approach to risk mitigation in project scheduling

A problem of risk mitigation in project scheduling is formulated as a bi-objective optimization problem, where the expected makespan and the expected total cost are both to be minimized. The expected total cost is the sum of four cost components: overhead cost, activity execution cost, cost of reducing risks and penalty cost for tardiness. Risks for activities are predefined. For each risk at an activity, various levels are defined, which correspond to the results of different preventive measures. Only those risks with a probable impact on the duration of the related activity are considered here. Impacts of risks are not only accounted for through the expected makespan but are also translated into cost and thus have an impact on the expected total cost. An MIP model and a heuristic solution approach based on genetic algorithms (GAs) is proposed. The experiments conducted indicate that GAs provide a fast and effective solution approach to the problem. For smaller problems, the results obtained by the GA are very good. For larger problems, there is room for improvement

Multi-project scheduling with 2-stage decomposition

A non-preemptive, zero time lag multi-project scheduling problem with multiple modes and limited renewable and nonrenewable resources is considered. A 2-stage decomposition approach is adopted to formulate the problem as a hierarchy of 0-1 mathematical programming models. At stage one, each project is reduced to a macro-activity with macro-modes resulting in a single project network where the objective is the maximization of the net present value and the cash flows are positive. For setting the time horizon three different methods are developed and tested. A genetic algorithm approach is designed for this problem, which is also employed to generate a starting solution for the exact solution procedure. Using the starting times and the resource profiles obtained in stage one each project is scheduled at stage two for minimum makespan. The result of the first stage is subjected to a post-processing procedure to distribute the remaining resource capacities. Three new test problem sets are generated with 81, 84 and 27 problems each and three different configurations of solution procedures are tested

Welcome to OR&S! Where students, academics and professionals come together

In this manuscript, an overview is given of the activities done at the Operations Research and Scheduling (OR&S) research group of the faculty of Economics and Business Administration of Ghent University. Unlike the book published by [1] that gives a summary of all academic and professional activities done in the field of Project Management in collaboration with the OR&S group, the focus of the current manuscript lies on academic publications and the integration of these published results in teaching activities. An overview is given of the publications from the very beginning till today, and some of the topics that have led to publications are discussed in somewhat more detail. Moreover, it is shown how the research results have been used in the classroom to actively involve students in our research activities

Pre-emptive resource-constrained multimode project scheduling using genetic algorithm: a dynamic forward approach

Purpose: The issue resource over-allocating is a big concern for project engineers in the process of scheduling project activities. Resource over-allocating drawback is frequently seen after scheduling of a project in practice which causes a schedule to be useless. Modifying an over-allocated schedule is very complicated and needs a lot of efforts and time. In this paper, a new and fast tracking method is proposed to schedule large scale projects which can help project engineers to schedule the project rapidly and with more confidence. Design/methodology/approach: In this article, a forward approach for maximizing net present value (NPV) in multi-mode resource constrained project scheduling problem while assuming discounted positive cash flows (MRCPSP-DCF) is proposed. The progress payment method is used and all resources are considered as pre-emptible. The proposed approach maximizes NPV using unscheduled resources through resource calendar in forward mode. For this purpose, a Genetic Algorithm is applied to solve. Findings: The findings show that the proposed method is an effective way to maximize NPV in MRCPSP-DCF problems while activity splitting is allowed. The proposed algorithm is very fast and can schedule experimental cases with 1000 variables and 100 resources in few seconds. The results are then compared with branch and bound method and simulated annealing algorithm and it is found the proposed genetic algorithm can provide results with better quality. Then algorithm is then applied for scheduling a hospital in practice. Originality/value: The method can be used alone or as a macro in Microsoft Office Project® Software to schedule MRCPSP-DCF problems or to modify resource over-allocated activities after scheduling a project. This can help project engineers to schedule project activities rapidly with more accuracy in practice.Peer Reviewe

An equitable approach to the payment scheduling problem in project management

This study reports on a new approach to the payment scheduling problem. In this approach, the amount and timing of the payments made by the client and received by the contractor are determined so as to achieve an equitable solution. An equitable solution is defined as one where both the contractor and the client deviate from their respective ideal solutions by an equal percentage. The ideal solutions for the contractor and the client result from having a lump sum payment at the start and end of the project respectively. A double loop genetic algorithm is proposed to solve for an equitable solution. The outer loop represents the client and the inner loop the contractor. The inner loop corresponds to a multi-mode resource constrained project scheduling problem with the objective of maximizing the contractor's net present value for a given payment distribution. When searching for an equitable solution, information flows between the outer and inner loops regarding the payment distribution over the event nodes and the timing of these payments. An example problem is solved and analyzed. A set of 93 problems from the literature are solved and some computational results are reported

Resource dedication problem in a multi-project environment

There can be different approaches to the management of resources within the context of multi-project scheduling problems. In general, approaches to multiproject scheduling problems consider the resources as a pool shared by all projects. On the other hand, when projects are distributed geographically or sharing resources between projects is not preferred, then this resource sharing policy may not be feasible. In such cases, the resources must be dedicated to individual projects throughout the project durations. This multi-project problem environment is defined here as the resource dedication problem (RDP). RDP is defined as the optimal dedication of resource capacities to different projects within the overall limits of the resources and with the objective of minimizing a predetermined objective function. The projects involved are multi-mode resource constrained project scheduling problems with finish to start zero time lag and non-preemptive activities and limited renewable and nonrenewable resources. Here, the characterization of RDP, its mathematical formulation and two different solution methodologies are presented. The first solution approach is a genetic algorithm employing a new improvement move called combinatorial auction for RDP, which is based on preferences of projects for resources. Two different methods for calculating the projects’ preferences based on linear and Lagrangian relaxation are proposed. The second solution approach is a Lagrangian relaxation based heuristic employing subgradient optimization. Numerical studies demonstrate that the proposed approaches are powerful methods for solving this problem