Mark E. Lewis
Industrial and Operations Engineering Department
University of Michigan
1205 Beal Avenue
Ann Arbor, MI 48109-2117

Seongmoon Kim

Industrial and Operations Engineering Department

University of Michigan

1205 Beal Avenue

Ann Arbor, MI 48109-2117

smoonkim@umich.edu

Chelsea C. White III

Industrial and Systems Engineering

Georgia Institute of Technology

765 Ferst Drive, Atlanta, GA 30332

cwhite@isye.gatech.edu, 404-894-0235

This paper examines the value of real-time traffic information to optimal vehicle routing in a non-stationary
stochastic network. We present a systematic approach to aid in the implementation of transportation systems
integrated with real time information technology. We develop decision-making procedures for determining the
optimal driver attendance time, optimal departure times, and optimal routing policies under stochastically
changing traffic flows based on a Markov decision process formulation. With a numerical study carried out on an
urban road network in Southeast Michigan, we demonstrate significant advantages when using this information in
terms of total costs savings and vehicle usage reduction while satisfying or improving service levels for
just-in-time delivery.