Project payment scheduling: A case study

This paper involves the payment scheduling problem of a typical project in reality. In the project, the client makes payments to the contractor based on the project progress, the activities can be performed with two modes, and there exists a bonus-penalty structure about the completion time of the project. Nonlinear integer programming models of the project payment scheduling problem are constructed from the contractor's, the client's, and the two-partyjoint perspectives respectively and a simulated annealing heuristic is developed and tested on a randomly generated data set. The models are solved and based on the solutions obtained it can be concluded that the desirable payment schedule from the joint perspective can be considered as a kind of global optimization outcome and those from the contractor's and the client's viewpoints are both local optimization results in a sense. In addition the bonus of the project is necessary, effective, and feasible while its penalty isn't necessary theoretically. Copyright