Solving the buffer allocation problem using simulation-based optimisation

In production lines, buffers function as a means to decouple stations, which reduce the effect that station failures and varying process times have on the complete line's throughput. However, adding larger buffers can be costly, for example, in the automotive industry where it results in increased working capital. This manuscript addresses the buffer allocation problem (BAP), seeking the smallest total buffer size while meeting a prescribed throughput by employing a simulation-based optimisation approach. A Tabu Search algorithm searches the solution space for the optimal buffer configuration while a discrete event simulation model evaluates each configuration, accounting for the machine (un)reliability. Since the multiple simulations add a sizeable computational burden, our approach introduces a novel neighbourhood search mechanism, which borrows from the Theory of Constrains. Solving test sets available in the literature suggest that this approach is 18 times faster than prior Adaptive Tabu Search approaches for small problems, and more than five times faster for medium-sized problems.