Product mix optimization for a semiconductor fab: Modeling approaches and decomposition techniques

To optimize the product mix of a semiconductor fab, the production capabilities and capacities are matched with the demand in the most profitable way. In this paper we address a linear programming model of the product mix problem considering product dependent demand limits (e.g. obligations and demand forecast) and profits while respecting the capacity bounds of the production facility. Since the capacity consumption is highly dependent on choosing from different production alternatives we are implicitly solving a static capacity planning problem for each product mix. This kind of planning approach is supported by the fluid flow concept and complete resource pooling in high traffic. We propose a general model that considers a wide range of objectives, and we introduce a heuristic that is based on the decomposition of the static capacity planning problem. A computational study reports on the quality of the decomposition approaches, and examples from practice demonstrate the versatility of the model.