Management Paper: Optimization vs. heuristics - Which is the right approach for your business?
There are many algorithmic techniques – such as constraint programming, mathematical programming, metaheuristics, local search, machine learning algorithms and evolutionary algorithms like genetic algorithms and simulated annealing – that are used to solve supply chain planning and scheduling problems. These algorithms can be classified into two main categories: heuristics and optimization.
The aim of optimization and heuristic solutions is the same – to provide the best possible solution to a given supply chain problem – but their outcomes are often dramatically different.
In this management paper, we will examine the differences between optimization and heuristics, and explore the pros and cons of each approach.