Theory and Methodology Tool capacity planning for semiconductor fabrication facilities under demand uncertainty

This research is motivated by issues faced by a large manufacturer of semiconductor devices. Semiconductor manufacturing companies allocate millions of dollars every year for new types of machine tools for their facilities. Typically these are special purpose machine tools which are made to order. The rate of change in products and technology makes it dicult for manufacturers to have a good estimate of future tool requirements. Further, manu-facturers experience a long lead time while procuring these tools. In this paper, we model the tool capacity planning problem under uncertainty in demand. The number of tools required in a facility is suciently large (nearly hundred or more tools) to make it nearly impossible to obtain ecient exact algorithms. We provide heuristics to find ecient tool procurement plans and test their quality using lower bounds on the formulation. Ó 2000 Elsevier Science B.V. All rights reserved