DECISION SUPPORT MODEL FOR DESIGNING MODULES WHEN SUBSTITUTED PARTS AND MULTIPLE VENDORS ARE PRESENT.

The design of standard integrated-circuit modules for an entire product line is examined as an alternative to individual product design. A model is presented for designing a single standard module when many parts can satisfy a particular technical requirement and parts may be purchased from a variety of vendors. This is important in defense-related industries, where there is a high fixed charge when the designer uses a part from an unapproved vendor list. The model attempts to minimize the total fixed costs for using vendors and parts as well as the total variable costs for parts. Technical requirements for the set of end items are modeled by requiring that each end item be designed with a minimal number of parts from each substitution group. Life cycle demand must also be met. A solution heuristic that decomposes the problem into a set-covering problem and a simpler modular design problem is presented. Some initial computational results that are encouraging are included.