Authors: Murphy, G.; Stander, H.C.

Source: Southern Hemisphere Forestry Journal, Volume 69, Number 2, October 2007 , pp. 117-123(7)

Publisher: NISC Pty Ltd

Abstract:

Forest transportation costs are the major cost component for many forest product supply chains. In order to minimise these costs, many organisations have turned to optimisation models to guide decisions that are extremely complex in nature. These models generally assume that input parameters are known with certainty, but in reality they are often associated with a high degree of uncertainty. One way of dealing with uncertainty is through robust optimisation, a procedure which is capable of generating near-optimal solutions that are relatively unaffected by the surrounding uncertainty. We illustrate this by means of a case study that employs a robust optimisation procedure. Our procedure employs a two-phase approach. The first phase creates a more tractable problem by limiting the search to those solutions that are near optimal and feasible. The second phase simulates the affect of uncertainty on the solutions isolated in the previous phase. The simulation results are then evaluated for robustness by means of seven robustness performance measures. For our case study, the results show that (1) the deterministic solution is extremely unstable and highly reliant on a particular degree of uncertainty, that (2) the robust solution is dependent on the robust performance measure selected, and (3) that the true robust solution is different from the deterministic solution.

Keywords: FOREST TRANSPORTATION; NET PRESENT VALUE; ROBUST SOLUTIONS; UNCERTAINTY

Document Type: Research article

DOI: http://dx.doi.org/10.2989/SHFJ.2007.69.2.7.293

Publication date: 2007-10-01

More about this publication?

• Prior to 2007, this journal was titled the Southern African Forestry Journal. These back issues may be accessed here. The Southern Hemisphere Forestry Journal publishes scientific articles in forest science and management of fast-growing, planted or natural forests in the Southern Hemisphere and the tropics. Papers are also encouraged on related disciplines such as environmental aspects of forestry, social forestry, agroforestry, forest engineering and management as well as the goods and services that are derived from forests as a whole. Articles published by the journal are of value to forest scientists, resource managers and society at large. The journal particularly encourages contributions from South America, Africa and tropical/sub-tropical Australasia and Asia.

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