Load dependent lead time modelling: A robust optimization approach

Although production planning models using nonlinear CFs have shown promising results for semiconductor wafer fabrication facilities, the lack of an effective methodology for estimating the CFs is a significant obstacle to their implementation. Current practice focuses on developing point estimates using least-squares regression approaches. This paper compares the performance of a production planning model using a multi-dimensional CF and its robust counterpart under several experimental settings. As expected, as the level of uncertainty is increased, the resulting production plan deviates from the optimal solution of the deterministic model. On the other hand, production plans found using the robust counterpart are less vulnerable to parameter estimation errors.