Considering Uncertainty in Unequal Area Block Layout Design

This paper presents an extended formulation of the unequal area facilities block layout problem which explicitly considers uncertainty in material handling costs by use of expected value and standard deviations of product forecasts. This formulation is solved using a random keys genetic algorithm (RKGA) heuristic with a flexible bay construct of the departments and total facility area. It is shown that depending on the attitude towards uncertainty of the decision maker, the optimal layout can change significantly. The seminal 20 department problem of Armour and Buffa is studied with varying numbers of products and amount of forecast uncertainty. The RKGA is shown to be a robust optimizor that allows a user to make an explicit characterization of the cost and uncertainty trade-offs involved in a particular block layout problem.