Journal of Small Business and Entrepreneurship Development

A Linear Programming Model of Integrating Flexibility Measures into Production Processes with Cost Minimization
Ing. Lenka Veselovska

Abstract
This paper focuses on a current topic of production management and operations research which serves as a tool for small and medium enterprises to cope with pressure put on the by continuously changing market conditions and global economy itself. Paper presents a linear programming model developed in order to achieve flexibility of production processes in operations management and also to minimize costs throughout the whole production process. Created model is general in its nature and therefore it can be applied on any kind of production process with just a few modifications. Therefore it is suitable for production company with any type of process orientation. Model stresses the importance of cost minimization, which is also its main objective. Resource procurement costs, fixed and variable production costs, inventory costs and transportation costs are included. Several possibilities of flexibility measures implementation are considered. These measure focus on employee flexibility, machinery flexibility and resource flexibility. Proposed model also take into account market conditions.

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