Challenge Dec-2025 “Inside/Outside Production”
Blog: For Practitioners by Practitioners!
You need to help a manufacturer decide how much of each demanded product should be produced internally and how much should be sourced from outside. Whether a product is made inside or outside, it has an associated cost. A product can consume a given amount of internal resources that have limited capacities. The general objective is to minimize the total production cost while ensuring the company meets the demand exactly or with a certain tolerance.
The manufacturer wants to consider various production decisions to choose the most suitable ones based on the long-term resource availability and uncertain future demand. Link
