SEMINAR:Distributionally robust facility location problem under...03-05-2021

Speaker: Beste Başçiftçi

Title: Distributionally robust facility location problem under decision-dependent stochastic demand

Date/Time: 5 May 2021 / 13:40 - 14:30

Zoom: Meeting ID:https://sabanciuniv.zoom.us/j/3923709046

Passcode: 931706

Abstract:While the traditional facility location problem considers exogenous demand, in some applications, locations of facilities could affect the willingness of customers to use certain types of services, e.g., carsharing, and therefore they also affect realizations of random demand. Moreover, a decision maker may not know the exact distribution of such endogenous demand and how it is affected by location choices. In this study, we consider a distributionally robust facility location problem, in which we interpret the moments of stochastic demand as functions of facility-location decisions. We reformulate a two-stage decision-dependent distributionally robust optimization model as a monolithic formulation, and then derive exact mixed-integer linear programming reformulation as well as valid inequalities when the means and variances of demand are piecewise linear functions of location solutions. We conduct extensive computational studies, in which we compare our model with a decision-dependent deterministic model, as well as stochastic programming and distributionally robust models without the decision-dependent assumption. The results show superior performance of our approach with remarkable improvement in profit and quality of service under various settings, in addition to computational speed-ups given by formulation enhancements. These results draw attention to the need of considering the impact of location decisions on customer demand within this strategic-level planning problem.

Bio:Beste Basciftci obtained her BS degrees in Computer Engineering and Industrial Engineering (double major) with high honors from Bogazici University in 2013. She then obtained her MS degree in Industrial Engineering from Bogazici University in 2015. Afterwards, she received her PhD degree in Operations Research from the H. Milton Stewart School of Industrial and Systems Engineering at Georgia Institute of Technology in 2019. Before joining Sabanci University, she worked as a Postdoctoral Fellow at Georgia Institute of Technology. Her research mainly focuses on data-driven decision making under uncertainty with a methodological interest in mixed-integer programming, stochastic programming, distributionally robust optimization in various problem settings involving applications in energy systems, supply chains, smart city operations, asset management and mobility. Her research has been awarded with several prestigious awards including INFORMS Energy, Natural Resources, and the Environment Section Best Student Paper Award and Georgia Institute of Technology Alice and John Jarvis PhD Research Award.