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Impact of dynamic flexible capacity on reverse logistics network design with environmental concerns

  • S.I. : OR for Sustainability in Supply Chain Management
  • Published:
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Abstract

In this paper, we propose a multi-objective reverse logistics network design model for multiple periods under uncertainty. The proposed model addresses the conflicting objectives of maximizing profit and minimizing carbon emissions in a reverse logistics network design problem. We conceptualize dynamic flexibility in capacity levels of different facilities in reverse logistics under multi-objective optimization setting. Our dynamic flexible capacity model allows the decision makers to increase or decrease the capacity levels of facilities in different periods. Augmented \(\varepsilon \)-constraint method is considered to solve the multi-objective optimization problem. Our analysis shows that the flexible capacity can improve the profit and reduce the carbon emission when compared with the fixed capacity case. Sensitivity analysis is carried out with respect to different costs and subsidies in the system to illustrate the robustness of the model. The analysis shows that the Pareto-frontiers associated with low cost and high subsidy dominate that of high cost and low subsidy, respectively. Results of the study suggest the need for providing flexible capacity levels in designing the reverse logistics network with environmental concerns for a better performance of reverse logistics.

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Notes

  1. Point 6 in the Pareto frontier in Fig. 1.

  2. In our dynamic flexible model, the highest level of capacity is set as the capacity level in the fixed capacity model. This is a logical assumption to ensure that the fixed capacity model is prepared with maximum possible capacity to operate in an uncertain demand scenario.

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Authors and Affiliations

  1. Mphasis NextLabs, Mphasis Limited, Banglore, 560 093, India

    Manish Shukla

  2. Department of Industrial and Management Engineering, Indian Institute of Technology Kanpur, Kanpur, 208 016, India

    B. Vipin & Raghu Nandan Sengupta

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  1. Manish Shukla
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Shukla, M., Vipin, B. & Sengupta, R.N. Impact of dynamic flexible capacity on reverse logistics network design with environmental concerns. Ann Oper Res (2022). https://doi.org/10.1007/s10479-022-04565-y

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