Title: Modeling and analysis of the cooperative production and service networks


Speaker: Behnaz Hosseini


Time: January 9, 2019, 15:00


Place: ENG 208

Koç University

Rumeli Feneri Yolu

Sariyer, Istanbul

Thesis Committee Members:

Prof. Barış Tan (Advisor, Koç University)

Prof. Fikri Karaesmen (Koç University)

Prof. Sencer Yeralan (University of Florida, International University of Sarajevo)

Prof. Lerzan Örmeci (Koç University)

Assoc. Prof. Aybek Korugan (Boğaziçi University)



In response to the economic condition and competition in the business environment, manufacturers and service providers began using cooperation-based business models to utilize their capacity effectively and access more customers. Different mechanisms enable the producers or the service providers to work together and share resources.  These mechanisms facilitate cooperation among different members and provide more efficient services at a lower cost. This thesis consists of three parts that address modeling and analysis of cooperative production and service networks.

In the first part, we study the cooperative production business model for a group of producers participating in a network to receive additional external customers who buy products under certain conditions. The cooperative network routes an arriving external customer to one of the participants based on the network routing policy. We model the system as a Markov decision process and determine the optimal production and rationing policies for each participating manufacturer as well as the optimal routing policy for the network by using mathematical programming approach. Our results show that a cooperative network can provide financial benefits for the producers and also allows the external customers to obtain goods at a lower price with the desired service level.

In the second part, the mathematical programming approach is proposed as a viable alternative method for simulation, performance evaluation, and optimization of a general continuous-flow production system with an intermediate finite buffer. We show that a simulated sample realization of the system is obtained by solving a mixed-integer linear program, and our numerical results present a significant computational improvement compared to using a discrete-event simulation.

In the last part of the dissertation, we examine the operational model of a cooperative service network with an application in telemedicine platform. The platform consists of a number of doctors serving their own patients in person, and receive the on-line medical requests from the platform whenever they are available. We consider the dynamic admission problem for each doctor in the platform who faces with heterogeneous patient streams. This problem is modeled as a Markov decision process, and we prove the existence of threshold-type optimal control policy. Once the optimal operation of the doctors is modeled, we then analyze the operation of the whole platform. This analysis allows us to design a platform effectively by choosing the right number of doctors based on the doctors’ utilization, the patients’ arrival rate and the desired service level. We show that a cooperative service network such as a telemedicine platform is an effective way of utilizing the idle capacity of the servers and serving the patients with the desired service level.

We believe that the results derived in this dissertation will be of value for the producers and service providers planning to join the cooperative networks to reach the full benefits of cooperation. This dissertation also extends the state of art in the analyses of cooperative networks by considering different kinds of settings that have not been addressed in the literature. Therefore, we provide researchers a basis for further research and development on the new cooperation based business models both for the production and service systems.