Hierarchical planning systems have become popular for multilevel decision problems. After reviewing the concept of hierarchical planning and citing some examples, the authors describe a method for analytic evaluation of a hierarchical planning system. They show that multilevel decision problems can be nicely modeled as multistage stochastic programs. Then any hierarchical planning system can be measured against the yardstick of optimality in this stochastic program. They demonstrate this approach on a hierarchical system that can be shown to be asymptotically optimal for a job shop design/scheduling problem
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