Professional Documents
Culture Documents
OPERATIONS RESEARCH
Advisory Council
Prof. Dr. M. M. Salunkhe Chairman
Hon’ble Vice Chancellor, Bharati Vidyapeeth (Deemed to be University), Pune
●
Open University, Nashik, Former Vice Chancellor, Indira Gandhi National Open University, New Delhi
• College of Engineering
MUMBAI
KOLHAPUR
LIBERAL EDUCATION INSTITUTES
• Institute of Management
• Yashwantrao Mohite College of Arts, Sci. and Comm.
(Jr., Sr. and Post-graduate)
• Social Science Centre KARAD
SOLAPUR
• Abhijit Kadam Institute of Management and Social Sciences
Bharati Vidyapeeth
(Deemed to be University), Pune
School of Distance education
course curriculum team
NAME DESIGNATION ORGANIZATION
Sr.
No.
BVDU Yashwantrao Mohite College of Arts, Science & Commerce, Prin. Dr. S. R. Patil Dr. V. A. Rankhambe
1
Paud Road, Erandwane, Pune – 411038 Tel. No. 020 – 25433383
BVDU Social Science Centre Dr. G. R. Rathod Dr. Anita Mohite
2
Paud Road, Erandawane, Pune - 411 038 Tel. No. 020-25448520
BVDU New Law College, Paud Road, Erandwane, Pune – 411038 Dr. Smt. B. M. Deshpande Dr. Smt. U.S. Bendale
3
Tel. No. 09156911396, 020-25444616
BVDU Institute of Management & Entrepreneurship Development, Dr. S. S. Vernekar Prof. N. R. Mate
4
Paud Rd, Erandwane, Pune – 411038 Tel. No.020-25431060, 60127666
BVDU Institute of Management & Research, Opp. Ordnance Depot, Dr. A. R. Deshmukh Ms. Megha Sehgal
5 A-4, Rohtak Road, NH-10, Paschim Vihar Ext., New Delhi -110063 Ms. Savneet Kaur
Tel. No. 011 – 25278446, 25285808, 09250547203 / 204
BV Institute of Management Studies & Research, Sector-8, C.B.D. Dr. Smt. A. A. Kalse Dr. R. D. Patil
6
Belapur, Navi Mumbai – 400614 Tel. No. 022 – 27572433, 27562582
BVDU Institute of Management, Kadamwadi, Kolhapur – 416003 Dr. R. U. Kanthe Dr. Mukund Kulkarni
7
Tel. No. 0231 – 2660666
BVDU Yashwantrao Mohite Institute of Management, Sr. No. 114/2A, Dr. N. R. Jadhav Dr. V. P. Deshmukh
8 Venkateshnagar, Koyana Vasahat, Pune-Bangalore Road,
Malkapur, Karad – 415539 Tel. No. 02164 – 242242, 241169
BVDU Institute of Management & Rural Development Administration, Dr. Nitin Nayak Prof. K. Venkatesh
9
Rajwada Chowk, Sangli – 416416 Tel. No. 0233 – 2625776
10 BVDU Abhijit Kadam Institute of Management & Social Sciences, Dr. V. S. Mangnale Dr. S. S. Suryawanshi
Bijapur Road, Solapur – 413004 Tel. No. 0217 – 2302016
School of Distance Education
Bharati Vidyapeeth
OPERATIONS RESEARCH
MBA/MBA HR/ MBA E SEM III (302)
(Deemed to be University), Pune, India
Writers team
iSBn : 978-93-88794-75-6
CONTENTS
Unit Contents Page No.
5 SIMULATION 109-125
UNIT - I NOTES
OVERVIEW OF OPERATIONS
RESEARCH
CHAPTER OBJECTIVES
• To familiarize the students with the history of operations research.
• To familiarize the students with the use of operations research techniques
in business domain.
CONTENTS
1.1 INTRODUCTION
1.2 HISTORY OF OPERATIONS RESEARCH
1.3 MEANING OF OPERATIONS RESEARCH
1.4 SCOPE OF OPERATIONS RESEARCH
1.5 SIGNIFICANCE OF OPERATIONS RESEARCH
1.6 LIMITATIONS OF OPERATIONS RESEARCH
1.7 APPLICATIONS OF OPERATIONS RESEARCH IN BUSINESS
AND MANAGEMENT
1.8 LATEST APPLICATIONS OF OPERATIONS RESEARCH
KEY WORDS
History, scope, significance, applications.
1.1 INTRODUCTION
Operations
The activities carried out in an organization.
Research
The process of observation and testing characterized by the scientific
method. Situation, problem statement, model construction, validation,
experimentation, candidate solutions.
Defining OR is difficult task as its boundaries and content are not yet fixed.
It can be regarded as use of mathematical and quantitative techniques to
substantiate the decision being taken. Further, it is multidisciplinary which takes
tools from subjects like mathematics, statistics, engineering, economics,
psychology etc. and uses them to score the consequences of possible alternative
actions. Today it has become professional discipline that deals with the
application of scientific methods to decision-making.
Few other definitions of OR are as follows
“OR is concerned with scientifically deciding how to best design and
OVERVIEW OF
operate man-machine system usually requiring the allocation of scare resources.”
OPERATIONS
Operations Research Society, America RESEARCH 3
Operations Research “OR is essentially a collection of mathematical techniques and tools which
in conjunction with system approach, are applied to solve practical decision
problems of an economic or engineering nature’’.
NOTES Daellenbach and George
The scope of OR is not only confined to any specific agency like defence
services but today it iswidely used in all industrial organizations. It can be used
to find the best solution to any problem be it simple or complex. It is useful in
every field of human activities, where optimization of resources is required in
the best way. Thus, it attempts to resolve the conflicts of interest among the
components of organization in a way that is best for the organization as a whole.
The main fields where OR is extensively used are given below, however, this list
is not exhaustive but only illustrative.
(i) National Planning and Budgeting
OR is used for the preparation of Five Year Plans, annual budgets,
forecasting of income and expenditure, scheduling of major projects
of national importance, estimation of GNP, GDP, population,
employment and generation of agriculture yields etc.
(viii) Transportation
Transportation models of OR can be applied to real life problems to
forecast public transport requirements, optimum routing, forecasting
of income and expenses, project management for railways, railway
network distribution, etc. In the same way it can be useful in the field
of communication.
OVERVIEW OF
OPERATIONS
6 RESEARCH
Operations Research
(v) Implementation
Implementation of any decision is a delicate task. It must take into
account the complexities of human relations and behavior. Sometimes,
resistance is offered due to psychological factors which may not have
any bearing on the problem as well as its solution.
OVERVIEW OF
OPERATIONS
RESEARCH 7
Operations Research
1. Accounting
• Assigning audit teams effectively Credit policy analysis
• Cash flow planning
• Developing standard costs
• Establishing costs for byproducts
• Planning of delinquent account strategy
2. Construction
• Project scheduling, monitoring and control
• Determination of proper work force
• Deployment of work force
• Allocation of resources to projects.
3. Facilities Planning
• Factory location and size decision
• Estimation of number of facilities required
• Hospital planning
• Quantitative Techniques for Managers
• International logistic system design
• Transportation loading and unloading
• Warehouse location decision
4. Finance
• Building cash management models
• Allocating capital among various alternatives
• Building financial planning models
• Investment analysis
OVERVIEW OF • Portfolio analysis
OPERATIONS
8 RESEARCH • Dividend policy making
4. Manufacturing Operations Research
• Inventory control
• Marketing balance projection
NOTES
• Production scheduling
• Production smoothing
5. Marketing
• Advertising budget allocation
• Product introduction timing
• Selection of Product mix
• Deciding most effective packaging alternative
7. Purchasing
• Optimal buying
• Optimal reordering
• Materials transfer
REFERENCES
1. http://mcehassan.ac.in
2. Operations Research. Second Edition P. Rama Murthy. New Age
International (P) Ltd
3. http://www.pondiuni.edu.in/storage/dde/downloads/mbaii_qt.pdf
4. https://www.pitt.edu/~jrclass/or/or-intro.html
5. Leachman, R. C., R. F. Benson, C. Liu and D. J. Raar, "IMPReSS: An
Automated Production-Planning and Delivery-Quotation System at
Harris Corporation - Semiconductor Sector," Interfaces, 26:1, pp. 6-
37, 1996.
6. Rigby, B., L. S. Lasdon and A. D. Waren, "The Evolution of Texaco's
Blending Systems: From OMEGA to StarBlend," Interfaces, 25:5, pp.
64-83, 1995.
7. Flanders, S. W. and W. J. Davis, "Scheduling a Flexible Manufacturing
System with Tooling Constraints: An Actual Case Study," Interfaces,
25:2, pp. 42-54, 1995.
8. Subramanian, R., R. P. Scheff, Jr., J. D. Quillinan, D. S. Wiper and R.
OVERVIEW OF E. Marsten, "Coldstart: Fleet Assignment at Delta Air Lines,",
OPERATIONS Interfaces, 24:1, pp. 104-120, 1994.
10 RESEARCH
9. Kotha, S. K., M. P. Barnum and D. A. Bowen, "KeyCorp Service Operations Research
Excellence Management System," Interfaces, 26:1, pp. 54-74, 1996.
EXERCISE NOTES
1. Trace the history of Operations Research.
2. Give a brief account of history of Operations Research.
3. "Operations Research is a bunch of mathematical techniques to break
industrial problems”. Critically comment.
4. Briefly explain the significance of Operations Research.
5. Discuss the scope of Operations Research.
6. State and explain the limitations of Operations Research
*****
OVERVIEW OF
OPERATIONS
RESEARCH 11
Operations Research
UNIT - II
LINEAR PROGRAMMING
NOTES
PROBLEM
CHAPTER OBJECTIVES
1. To familiarize the students with the components of LPP.
2. To familiarize the students with the formulation of LPP.
3. To develop the quantitative skills of the students to make them skilled
at using graphical method of solving LPP.
CONTENTS
2.1 DEFINITION
2.2 COMPONENTS OF LPP
2.3 FORMULATION OF LPP
2.4 SOLUTION OF LPP: GRAPHICAL METHOD OF SOLVING LPP
2.5 APPLICATIONA AND LIMITATIONS OF LPP
INTRODUCTION
Linear programming (LP) is one of the simplest ways to perform
optimization. It helps you solve some very complex optimization problems by
making a few simplifying assumptions. As an analyst you are bound to come
across applications and problems to be solved by Linear Programming
1. Linear Equations
All of the equations and inequalities in a linear program must, by definition,
be linear. A linear function has the following form: a0 + a1 x1 + a2 x2 + a3 x3
+. . + anxn = 0----(where 1,2,3,---n as subscript.)
In general, the a’s are called the coefficients of the equation; they are also
sometimes called parameters. The important thing to know about the coefficients
is that they are fixed values, based on the underlying nature of the problem being
solved. The x’s are called the variables of the equation; they are allowed to take
on a range of values within the limits defined by the constraints. Note that it is
not necessary to always use x’s to represent variables; any label could be used,
and more descriptive labels are often more useful.
Linear equations and inequalities are often written using summation
notation, which makes it possible to write an equation in a much more compact
form. The linear equation above, for example, can be written as follows:
Note that the letter i is an index, or counter, that starts in this case at 1 and
runs to n. There is a term in the sum for each value of the index. Just as a variable
does not have to be specified with a letter x, the index does not have to be a letter
i. Summation notation will be used a lot in the rest of this chapter and in all of
the remaining chapters. You will need to become adept at interpreting it.
4. The Constraints
The constraints indicate limitations on the resources, which are to be
allocated among various decision variables. These resources may be production
capacity, manpower, time, space or machinery. These must be capable of being
expressed as linear equation (i.e. =) on inequalities (i.e. > or<; type) in terms of
decision variables. Thus, constraints of a linear programming problem are linear
LINEAR PROGRAMMING
14 PROBLEM equalities or inequalities arising out of practical limitations.
5. The Non-Negativity Constraints Operations Research
For technical reasons beyond the scope of this book, the variables of linear
programs must always take non-negative values (i.e., they must be greater than
or equal to zero). In most cases, where, for example, the variables might NOTES
represent the levels of a set of activities or the amounts of some resource used,
this non-negativity requirement will be reasonable – even necessary. In the rare
case where you actually want to allow a variable to take on a negative value there
are certain formulation “tricks” that can be employed. These “tricks” also are
beyond the scope of this class, however, and all of the variables we will use will
only need to take on non-negative values. In any case, the non-negativity
constraints are part of all LP formulations, and you should always include them
in an LP formulation. They are written as follows:
xi ≠ 0 i = 1, 2, . . ., n
where xi = the ith decision variable.
6. Feasible Solution
Any solution to graphical method of L.P.P. which satisfies the non-
negativity restrictions of the problem is called a feasible solution to a general
L.P.P.
7. Optimum solution
Any feasible solution to graphical method of L.P.P. which optimizes
(maximizes/ minimizes) the objective function of L.P.P. is called an optimum
solution to the L.L.P.
Situation 1
Suppose he decides to buy tables only and no chairs, so he can buy 50000
÷ 2500, i.e., 20 tables. His profit in this case will be Rs (250 × 20), i.e., Rs 5000.
Situation 2
Suppose he chooses to buy chairs only and no tables. With his capital of Rs
50,000, he can buy 50000 ÷ 500, i.e. 100 chairs.
But he can store only 60 pieces. Therefore, he is forced to buy only 60 chairs
which will give him a total profit of Rs (60 × 75), i.e., Rs 4500.
There are many other possibilities, for instance, he may choose to buy 10
tables and 50 chairs, as he can store only 60 pieces. Total profit in this case would
be Rs (10 × 250 + 50 × 75), i.e., Rs 6250 and so on.
We, thus, find that the dealer can invest his money in different ways and he
would earn different profits by following different investment strategies. Now
the problem is: How should he invest his money in order to get maximum profit?
To answer this question, let us try to formulate the problem mathematically
Example 3: A factory manufactures two products Table (A) and Chairs (B).
For manufacturing one unit of A, 15 machine hours and 25 labour hours are
required. For manufacturing product B, 25 machine hours and 15 labour hours
are required. In a month, 300 machine hours and 240 labour hours are available.
Profit per unit for A is Rs. 50 and for B is Rs. 40. Formulate as LPP to maximize
the profit.
LINEAR PROGRAMMING
18 PROBLEM
Solution: Formulation of LPP Operations Research
1. The objective is to maximize the total profit by selling units of
Table(X) and Chair(Y) which are produced under the given production
machine and labour constraints. NOTES
2. Decision Variables
Let X1 be the total units of table to be manufactured.
and X2 be the total units of chair to be manufactured.
3.Objective function: Total Profit (Z = 50X1 + 40X2) must be maximized.
Thus,
Maximize P= 50X1 + 40X2 is the objective function.
4. Constraints
(i) Machine Constraints: Total hours available for machine (i.e. 15X1+
25X2 must be less than or equal to the time available i.e. 300 hours. Thus,
15X1+ 25X2 ≤ 300
(ii) Labour Constraints: Total hours available for labour (i.e. 25X1+
15X2must be less than or equal to the time available i.e. 240 hours. Thus,
25X1+ 15X2 ≤ 240
Thus the LPP format is,
Maximize Z = 50X1+ 40X2
Subject to the constraints:
15X1+ 25X2 ≤ 300
25X1+ 15X2 ≤ 240
x ≥ 0, y ≥ 0
Example 1
Maximize Z = 250x + 75y
subject to the constraints:
5x + y ≤ 100
x + y ≤ 60
x ≥ 0, y ≥ 0
We will now solve this problem graphically. Let us graph the constraints
stated as linear inequalities: 5x + y ≤ 100 ... (1)
x + y ≤ 60 ... (2)
x ≥ 0 ... (3)
y ≥ 0 ... (4)
Any point in the feasible region that gives the optimal value (maximum or
minimum) of the objective function is called an optimal solution. Now, we see
that every point in the feasible region OAED satisfies all the constraints as given
in (1) to (4), and since there are infinitely many points, it is not evident how we
should go about finding a point that gives a maximum value of the objective
function Z = 250x + 75y. To handle this situation, we use the following theorems
which are fundamental in solving linear programming problems.
Hence the optimal solution is,
Maximize Z = 6250
X1 = 10
X2 = 50
The maximum profit to the dealer i.e. Rs 6250 results from the investment
strategy (10, 50), i.e. buying 10 tables and 50 chairs.
Theorem 1: Let R be the feasible region (convex polygon) for a linear
programming problem and let Z = ax + by be the objective function. When Z has
an optimal value (maximum or minimum), where the variables x and y are subject
to constraints described by linear inequalities, this optimal value must occur at a
corner point* (vertex) of the feasible region.
Theorem 2: Let R be the feasible region for a linear programming problem,
and let Z = ax + by be the objective function. If R is bounded**, then the
objective function Z has both a maximum and a minimum value on R and each
of these occurs at a corner point (vertex) of R.
Remark: If R is unbounded, then a maximum or a minimum value of the
objective function may not exist. However, if it exists, it must occur at a corner
point of R. (By Theorem 1). In the above example, the corner points (vertices)
of the bounded (feasible) region are: O, A, B and C and it is easy to find their
LINEAR PROGRAMMING
coordinates as (0, 0), (20, 0), (10, 50) and (0, 60) respectively.
22 PROBLEM
Example 2 Operations Research
Maximize Z = 100x + 250y
subject to the constraints:
NOTES
5x + 10y ≤ 2500
2x + 10y ≤ 1000
x + 2y ≤ 4000
x ≥ 0, y ≥ 0
We will now solve this problem graphically. Let us graph the constraints
stated as linear inequalities:
5x + 10y ≤ 2500 ... (1)
2x + 10y ≤ 1000 ...(2)
x + 2y ≤ 4000 ...(3)
x, y ≥ 0 ... (4)
LINEAR PROGRAMMING
24 PROBLEM
Step IV: To find the common feasible region. Operations Research
The common feasible region is OACD
Step V: Optimum solution
NOTES
Here are multiple solutions but the coordinates of the line are same.
Max Z = Rs 5000
x = 500
y = 100
Example 3
Maximize Z = 30x + 50y
subject to the constraints:
2x + 10y ≤ 500
4x + 5y ≤ 200
3x + y ≤ 300
x ≥ 0, y ≥ 0
We will now solve this problem graphically. Let us graph the constraints
stated as linear inequalities:
2x + 10y ≤ 500 ... (1)
4x + 5y ≤ 200 ...(2)
3x + y ≤ 300 ...(3)
x, y ≥ 0 ... (4)
NOTES
Here are multiple solutions but the coordinates of the line are same.
Max Z = Rs. 1500
x = 50
y=0
Examples on minimization
Example 4
Minimize Z = 40x + 20y
subject to the constraints:
2x + 5y ≥ 500
10x + 4y ≥200
x + y ≥300
LINEAR PROGRAMMING
x ≥ 0, y ≥ 0 PROBLEM 27
Operations Research Step I: Convert the given inequalities into equalities:
2x + 5y = 500 ... (1)
10x + 4y =200 ...(2)
NOTES
x + y = 300 ...(3)
x, y ≥ 0 ... (4)
Example 5
Minimize Z = 4x + 2y
Subject to : x + 2y ≥ 200
3x + y ≥ 300
4x + 3y ≥ 600
x≥0,y≥0 LINEAR PROGRAMMING
PROBLEM 29
Operations Research Step I: Convert the given inequalities into equalities:
x + 2y = 200 ... (1)
3x + y =300...(2)
NOTES
4x + 3y = 600 ...(3)
x, y ≥ 0 ... (4)
LINEAR PROGRAMMING
PROBLEM 31
Operations Research
APPLICATIONS OF LPP
1. Food and Agriculture
Farmers apply linear programming techniques to their work. By
determining what crops they should grow, the quantity of it and how
to use it efficiently, farmers can increase their revenue.
In nutrition, linear programming provides a powerful tool to aid in
planning for dietary needs. In order to provide healthy, low-cost food
baskets for needy families, nutritionists can use linear programming.
Constraints may include dietary guidelines, nutrient guidance, cultural
acceptability or some combination thereof. Mathematical modeling
provides assistance to calculate the foods needed to provide nutrition
at low cost, in order to prevent no communicable disease. Unprocessed
food data and prices are needed for such calculations, all while
respecting the cultural aspects of the food types. The objective function
is the total cost of the food basket. Linear programming also allows
time variations for the frequency of making such food baskets.
2. Applications in Engineering
Engineers also use linear programming to help solve design and
manufacturing problems. For example, in airfoil meshes, engineers
seek aerodynamic shape optimization. This allows for the reduction
of the drag coefficient of the airfoil. Constraints may include lift
coefficient, relative maximum thickness, nose radius and trailing edge
angle. Shape optimization seeks to make a shock-free airfoil with a
feasible shape. Linear programming therefore provides engineers with
an essential tool in shape optimization.
3. Transportation Optimization
Transportation systems rely upon linear programming for cost and time
efficiency. Bus and train routes must factor in scheduling, travel time
and passengers. Airlines use linear programming to optimize their
profits according to different seat prices and customer demand.
Airlines also use linear programming for pilot scheduling and routes.
Optimization via linear programming increases airlines' efficiency and
decreases expenses.
4. Efficient Manufacturing
Manufacturing requires transforming raw materials into products that
LINEAR PROGRAMMING
32 PROBLEM
maximize company revenue. Each step of the manufacturing process
must work efficiently to reach that goal. For example, raw materials Operations Research
must past through various machines for set amounts of time in an
assembly line. To maximize profit, a company can use a linear
expression of how much raw material to use. Constraints include the NOTES
time spent on each machine. Any machines creating bottlenecks must
be addressed. The amount of products made may be affected, in order
to maximize profit based on the raw materials and the time needed.
5. Energy Industry
Modern energy grid systems incorporate not only traditional electrical
systems, but also renewables such as wind and solar photovoltaics. In
order to optimize the electric load requirements, generators,
transmission and distribution lines, and storage must be taken into
account. At the same time, costs must remain sustainable for profits.
Linear programming provides a method to optimize the electric power
system design. It allows for matching the electric load in the shortest
total distance between generation of the electricity and its demand over
time. Linear programming can be used to optimize load-matching or
to optimize cost, providing a valuable tool to the energy industry.
LIMITATIONS OF LPP
1. Linearity of relations
A primary requirement of linear programming is that the objective
function and every constraint must be linear. However, in real life
situations, several business and industrial problems are nonlinear in
nature.
2. Single objective
Linear programming takes into account a single objective only, i.e.,
profit maximization or cost minimization. However, in today's
dynamic business environment, there is no single universal objective
for all organizations.
3. Certainty
Linear Programming assumes that the values of co-efficient of decision
variables are known with certainty. Due to this restrictive assumption,
linear programming cannot be applied to a wide variety of problems
where values of the coefficients are probabilistic
4. Constant parameters
Parameters appearing in LP are assumed to be constant, but in practical
situations it is not so.
LINEAR PROGRAMMING
PROBLEM 33
Operations Research 5. Divisibility
In linear programming, the decision variables are allowed to take non-
negative integer as well as fractional values. However, we quite often
NOTES face situations where the planning models contain integer valued
variables. For instance, trucks in a fleet, generators in a powerhouse,
pieces of equipment, investment alternatives and there are myriad of
other examples. Rounding off the solution to the nearest integer will
not yield an optimal solution. In such cases, linear programming
techniques cannot be used.
EXERCISE
Use the graphical method to solve each of the following LP problems.
1. A wheat and barley farmer has 168 hectare of ploughed land, and a
capital of Rs.2000. It costs E14 to sow one-hectare wheat and Rs.10
to sow one hectare of barley. Suppose that his profit is E80 per hectare
of wheat and Rs.55 per hectare of barley. Find the optimal number of
hectares of wheat and barley that must be ploughed in order to
maximize profit? What is the maximum profit?
2. An company manufactures two electrical products: air conditioners
and large fans. The assembly process for each is similar in that both
require a certain amount of wiring and drilling. Each air conditioner
takes 3 hours of wiring and 2 hours of drilling. Each fan must go
through 2 hours of wiring and 1 hour of drilling. During the next
production period, 240 hours of wiring time are available and up to
140 hours of drilling time may be used. Each air conditioner sold yields
a profit of Rs.25. Each fan assembled may be sold for a profit of Rs.15.
Formulate and solve this linear programming mix situation to find the
best combination of air conditioners and fans that yields the highest
profit.
3. A manufacturer of lightweight mountain tents makes a standard model
and an expedition model for national distribution. Each standard tent
requires 1 labour hour from the cutting department and 3 labour hours
from the assembly department. Each expedition tent requires 2 labour
hours from the cutting department and 4 labour hours from the
assembly department. The maximum labour hours available per day
in the cutting department and the assembly department are 32 and 84
respectively. If the company makes a profit ofRs. 50 on each standard
tent andRs. 80 on each expedition tent, use the graphical method to
determine how many tents of each type should be manufactured each
day to maximize the total daily profit?
4. A manufacturing plant makes two types of inflatable boats, a two-
person boat and a four-person boat. Each two-person boat requires 0.9
LINEAR PROGRAMMING labour hours from the cutting department and 0.8 labour hours from
34 PROBLEM
the assembly department. Each four-person boat requires 1.8 labour Operations Research
hours from the cutting department and 1.2 labour hours from the
assembly department. The maximum labour hours available per month
in the cutting department and the assembly department are 864 and NOTES
672 respectively. The company makes a profit of Rs.25 on each two-
person boat andRs. 40 on each four-person boat. Use the graphical
method to find the maximum profit.
5. Harsh Engineering produces chairs and tables. Each table takes four
hours of labour from the carpentry department and two hours of labour
from the finishing department. Each chair requires three hours of
carpentry and one hour of finishing. During the current week, 240
hours of carpentry time are available and 100 hours of finishing time.
Each table produced gives a profit of Rs.70 and each chair a profit of
Rs.50. How many chairs and tables should be made in order to
maximize profit?
6. A company manufactures two products X and Y. Each product has to
be processed in three departments: welding, assembly and painting.
Each unit of X spends 2 hours in the welding department, 3 hours in
assembly and 1 hour in painting. The corresponding times for a unit
of Y are 3,2 and 1 respectively. The man-hours available in a month
are 1500 for the welding department, 1500 in assembly and 550 in
painting. The contribution to profits and fixed overheads areRs. 100
for product X and Rs.120 for product Y. Formulate the appropriate
linear programming problem and solve it graphically to obtain the
optimal solution for the maximum contribution.
7. Suppose a manufacturer of printed circuits has a stock of 200 resistors,
120 transistors and 150 capacitors and is required to produce two types
of circuits. Type A requires 20 resistors, 10 transistors and 10
capacitors. Type B requires 10 resistors, 20 transistors and 30
capacitors. If the profit on type A circuits isRs. 5 and that on type B
circuits isRs. 12, how many of each circuit should be produced in order
to maximize profit?
8. A small company builds two types of garden chairs. Type A requires
2 hours of machine time and 5 hours of craftsman time. Type B
requires 3 hours of machine time and 5 hours of craftsman time. Each
day there are 30 hours of machine time available and 60 hours of
craftsman time. The profit on each type A chair isRs. 60 and on each
type B chair isRs. 84. Formulate the appropriate linear programming
problem and solve it graphically to obtain the optimal solution that
maximizes profit.
9. Sheetal sales produces two gift packages of fruit. Package A contains
20 peaches, 15 apples and 10 pears. Package B contains 10 peaches,
30 apples and 12 pears.Sheetal sales has 40 000 peaches, 60 000 apples LINEAR PROGRAMMING
PROBLEM 35
Operations Research and 27 000 pears available for packaging. The profit on package A
isRs. 2.00 and the profit on B is Rs.2.50. Assuming that all fruit
packaged can be sold, what number of packages of types A and B
NOTES should be prepared to maximize the profit?
10. A factory manufactures two products, each requiring the use of three
machines. The first machine can be used at most 70 hours; the second
machine at most 40 hours; and the third machine at most 90 hours.
The first product requires 2 hours on Machine 1, 1 hour on Machine
2, and 1 hour on Machine 3; the second product requires 1 hour each
on machines 1and 2 and 3 hours on Machine 3. If the profit inRs. 40
per unit for the first product andRs. 60 per unit for the second product,
how many units of each product should be manufactured to maximize
profit?
Minimization problems
1. A house wife wishes to mix together two kinds of food, I and II, in such
a way that the mixture contains at least 10 units of vitamin A, 12 units of vitamin
B and 8 units of vitamin C. The vitamin contents of one kg of food is given
below;
Vitamin A Vitamin B Vitamin C Food I 1 2 3 Food II 2 2 1
One Kg of food I costs E6 and one Kg of food II costs E10. Formulate the
above problem as a linear programming problem and find the least cost of the
mixture which will produce the diet.
1. A chicken farmer can buy a special food mix A at 20c per Kg and
special food mix B at 40c per Kg. Each Kg of mix A contains 3000
units of nutrient N1 and 1000 units of nutrient N2; each Kg of mix B
contains 4000 units of nutrient N1 and 4000 units of nutrient N2. If
the minimum daily requirements for the chickens collectively are
36000 units of nutrient N1 and 20000 units of nutrient N2, how many
pounds of each food mix should be used each day to minimize daily
food costs while meeting (or exceeding) the minimum daily nutrient
requirements? What is the minimum daily cost?
2. A farmer can buy two types of plant food, mix A and mix B. Each
cubic metre of mix A contains 20 kg of phosphoric acid, 30 kg of
nitrogen, and 5 kg of potash. Each cubic metre of mix B contains 10
kg of phosphoric acid, 30 kg of nitrogen and 10 kg of potash. The
minimum monthly requirements are 460 kg of phosphoric acid, 960
kg of nitrogen, and 220 kg of potash. If mix A costs Rs.30 per cubic
metre and mix B costs Rs.35 per cubic metre, how many cubic metres
of each mix should the farmer blend to meet the minimum monthly
requirements at a minimal cost? What is the cost?
3. A city council voted to conduct a study on inner-city community
LINEAR PROGRAMMING
36 PROBLEM problems. A nearby university was contacted to provide sociologists
and research assistants. Allocation of time and costs per week are given Operations Research
in the table. How many sociologists and how many research assistants
should be hired to minimize the cost and meet the weekly labour-hour
requirements? What is the weekly cost? NOTES
Labour hours minimum labourresearch hours needed sociologist
assistant per week fieldwork 10 30 180 research centre 30 10 140 costs
per week Rs. 500 300
4. A laboratory technician in a medical research centre is asked to
formulate a diet from two commercially packaged foods, food A and
food B, for a group of animals. Each kg of food A contains 8 units of
fat, 16 units of carbohydrates, and 2 units of protein. Each Kg of food
B contains 4 units of fat, 32 units of carbohydrate and 8 units of
protein. The minimum daily requirements are 176 units of fat, 1024
units of carbohydrate, and 384 units of protein. Iffood A costs 5Rs per
Kg and food B costs 5Rs per Kg, how many kilograms of each food
should be used to meet the minimum daily requirements at the least
cost? What is the cost of this amount?
5. A can of cat food, guaranteed by the manufacturer to contain at least
10 units of protein, 20 units of mineral matter, and 6 units of fat,
consists of a mixture of four different ingredients. Ingredient A contains
10 units of protein, 2 units of mineral matter, and 1 2 unit of fat per
100g. Ingredient B contains 1 unit of protein, 40 units of mineral
matter, and 3 units of fat per 100g. Ingredient C contains 1 unit of
protein, 1 unit of mineral matter, and 6 units of fat per 100g. Ingredient
D contains 5 units of protein, 10 units of mineral matter, and 3 units
of fat per 100g. The cost of each ingredient is 3Rs, 2Rs, 1Rs, and 4Rs
per 100g, respectively. How many grams of each should be used to
minimize the cost of the cat food, while still meeting the guaranteed
composition?
REFERENCES
1. ncert.nic.in
2. http://mcehassan.ac.in
3. Operations Research. Second Edition P. Rama Murthy. New Age
International (P) Ltd
4. https://sciencing.com
LINEAR PROGRAMMING
PROBLEM 37
Operations Research
NOTES
UNIT - III
TRANSPORTATION
PROBLEM (TP)
CHAPTER OBJECTIVES
1. To equip students with fundamentals of Transportation Problem.
2. To acquaint the students with initial basic feasible solution of
Transportation Problem.
3. To enable the students to understand optimal solution of Transportation
Problem.
CHAPTER CONTENTS
a) Introduction and Formulation of TP.
b) Initial Basic Feasible Solution (North West Corner Rule)
c) Matrix Minimum Method
d) Vogel’s Approximation Method - VAM)
e) Checking for Optimality, Moving towards optimality, finding optimal
solution
f) Special cases- TP for maximization
g) Uunbalanced TP, restricted TP, Multiple /Optimal Solutions, Business
Applications
KEY WORDS
Transportation Problem, initial basic feasible solution, optimal solution.
TRANSPORTATION
38 PROBLEM (TP)
Operations Research
3.1 INTRODUCTION
NOTES
The transportation problem is a special type of linear programming problem,
where the objective is to minimize the cost of distributing a product from a
number of sources to a number of destinations.
Thus, the problem has 8 constraints and 15 variables. So, it is not possible
to solve such a problem using simplex method. This is the reason for the need of
special computational procedure to solve transportation problem.
TRANSPORTATION
40 PROBLEM (TP)
Operations Research
The steps of the transportation algorithm are exact parallels of the simplex
algorithm, they are: TRANSPORTATION
PROBLEM (TP) 41
Operations Research Step 1: Determine a starting basic feasible solution, using any one of the
following three methods
1. North West Corner Method
NOTES
2. Least Cost Method
3. Vogel Approximation Method
Step 2: Determine the optimal solution using the following method:
MODI (Modified Distribution Method) or UV Method.
TRANSPORTATION
PROBLEM (TP) 43
Operations Research Once the demand and supply are equal, the following procedure is followed:
1. Select the north-west or extreme left corner of the matrix, assign as
many units as possible to cell AD, within the supply and demand
NOTES constraints. Such as 20 units are assigned to the first cell, that satisfies
the demand of destination D while the supply is in surplus.
2. Now move horizontally and assign 30 units to the cell AE. Since 30
units are available with the source A, the supply gets fully saturated.
3. Now move vertically in the matrix and assign 40 units to Cell BE. The
supply of source B also gets fully saturated.
4. Again move vertically, and assign 25 units to cell CE, the demand of
destination E is fulfilled.
5. Move horizontally in the matrix and assign 35 units to cell CF, both
the demand and supply of origin and destination gets saturated. Now
the total cost can be computed.
The Total cost can be computed by multiplying the units assigned to each
cell with the concerned transportation cost. Therefore,
Total Cost = 20*5+ 30*8+ 40*6+ 25*9+ 35*6 = Rs 1015
Solution
1. If the total supply is more than the total demand, then we add a new
column, with transportation cost 0
2. If the total demand is more than the total supply, then we add a new
row, with transportation cost 0
Example
Find Solution using North-West Corner method
TRANSPORTATION
44 PROBLEM (TP)
Solution Operations Research
TOTAL number of supply constraints : 3
TOTAL number of demand constraints : 3
NOTES
Problem Table is
Here Total Demand = 215 is less than Total Supply = 235. So We add a
dummy demand constraint with 0 unit cost and with allocation 20.
Now, the modified table is
Table-1
TRANSPORTATION
PROBLEM (TP) 45
Operations Research The rim values for S1=4 and D2=102 are compared.
The smaller of the two i.e. min(4,102) = 4 is assigned to S1 D2
This exhausts the capacity of S1 and leaves 102 - 4 = 98 units with D2
NOTES
Table-2
Table-3
Table-4
TRANSPORTATION
46 PROBLEM (TP)
The rim values for S3=61 and D3=41 are compared. Operations Research
The smaller of the two i.e. min(61,41) = 41 is assigned to S3 D3
This meets the complete demand of D3 and leaves 61 - 41 = 20 units with S3
NOTES
Table-5
Table-6
TRANSPORTATION
PROBLEM (TP) 47
Operations Research 3.5.2 Least Cost Method (Matrix Minimum Method)
Definition
NOTES The Least Cost Method is another method used to obtain the initial feasible
solution for the transportation problem. Here, the allocation begins with the cell
which has the minimum cost. The lower cost cells are chosen over the higher-
cost cell with the objective to have the least cost of transportation.
The Least Cost Method is considered to produce more optimal results than
the North-west Corner because it considers the shipping cost while making the
allocation, whereas the North-West corner method only considers the availability
and supply requirement and allocation begin with the extreme left corner,
irrespective of the shipping cost.
Let’s understand the concept of Least Cost method through a problem
given below:
In the given matrix, the supply of each source A, B, C is given Viz. 50units,
40 units, and 60 units respectively. The weekly demand for three retailers D, E,
F i.e. 20 units, 95 units and 35 units is given respectively. The shipping cost is
given for all the routes.
The minimum transportation cost can be obtained by following the
steps given below:
1. The minimum cost in the matrix is Rs 3, but there is a tie in the cell
BF, and CD, now the question arises in which cell we shall allocate.
Generally, the cost where maximum quantity can be assigned should
be chosen to obtain the better initial solution. Therefore, 35 units shall
be assigned to the cell BF. With this, the demand for retailer F gets
TRANSPORTATION fulfilled, and only 5 units are left with the source B.
48 PROBLEM (TP)
2. Again the minimum cost in the matrix is Rs 3. Therefore, 20 units shall Operations Research
be assigned to the cell CD. With this, the demand of retailer D gets
fulfilled. Only 40 units are left with the source C.
3. The next minimum cost is Rs 4, but however, the demand for F is NOTES
completed, we will move to the next minimum cost which is 5. Again,
the demand of D is completed. The next minimum cost is 6, and there
is a tie between three cells. But however, no units can be assigned to
the cells BD and CF as the demand for both the retailers D and F are
saturated. So, we shall assign 5 units to Cell BE. With this, the supply
of source B gets saturated.
4. The next minimum cost is 8, assign 50 units to the cell AE. The supply
of source A gets saturated.
5. The next minimum cost is Rs 9; we shall assign 40 units to the cell
CE. With his both the demand and supply of all the sources and origins
gets saturated.
The total cost can be calculated by multiplying the assigned quantity with
the concerned cost of the cell. Therefore,
Total Cost = 50*8 + 5*6 + 35*3 +20*3 +40*9 = Rs 955.
Note: The supply and demand should be equal and in case supply are more,
the dummy source is added in the table with demand being equal to the difference
between supply and demand, and the cost remains zero. Similarly, in case the
demand is more than supply, then dummy destination or origin is added to the
table with the supply equal to the difference in quantity demanded and supplied
and the cost being zero.
Find Solution of Transportation Problem using Least Cost method
Solution
TOTAL number of supply constraints : 3
TOTAL number of demand constraints : 4
TRANSPORTATION
PROBLEM (TP) 49
Operations Research Problem Table is
NOTES
Table-1
Table-2
TRANSPORTATION
50 PROBLEM (TP)
The allocation to this cell is min(10,7) = 7. Operations Research
This satisfies the entire demand of D4 and leaves 10 - 7 = 3 units with S3
Table-3 NOTES
Table-4
Table-5
TRANSPORTATION
PROBLEM (TP) 51
Operations Research The smallest transportation cost is 70 in cell S2D1
The allocation to this cell is min(2,2) = 2.
NOTES Table-6
NOTES
2. Column D is deleted, again the difference between the least cost cells
is calculated for each row and column, as seen in the iteration below.
The largest difference value comes to be 3, so allocate 35 units to cell
AF and 15 units to the cell AE. With this, the Supply and demand of
source A and origin F gets saturated, so delete both the row A and
Column F.
TRANSPORTATION
PROBLEM (TP) 53
Operations Research Now the total cost can be computed, by multiplying the units assigned to
each cell with the cost concerned. Therefore,
Total Cost = 20*3 + 35*1 + 15*4 + 60*4 + 20*8 = Rs 555
NOTES
Note: Vogel’s Approximation Method is also called as Penalty Method
because the difference costs chosen are nothing but the penalties of not choosing
the least cost routes.
Ex. Find Solution using Vogel's Approximation method
Solution
TOTAL number of supply constraints : 3
TOTAL number of demand constraints : 3
Problem Table is
Here Total Demand = 215 is less than Total Supply = 235. So We add a
dummy demand constraint with 0 unit cost and with allocation 20.
TRANSPORTATION
54 PROBLEM (TP)
Now, The modified table is Operations Research
NOTES
Table-1
Table-2
TRANSPORTATION
PROBLEM (TP) 55
Operations Research The maximum penalty, 8, occurs in row S3.
The minimum cij in this row is c31 = 8.
The maximum allocation in this cell is min(77,72) = 72.
NOTES
It satisfy demand of D1 and adjust the supply of S3 from 77 to 5 (77 - 72 = 5).
Table-3
Table-4
TRANSPORTATION It satisfy supply of S2 and adjust the demand of D2 from 102 to 81 (102 - 21 = 81).
56 PROBLEM (TP)
Table-5 Operations Research
NOTES
Table-6
TRANSPORTATION
PROBLEM (TP) 57
Operations Research Initial feasible solution is
NOTES
Step-6: Draw a closed path (or loop) from the unoccupied cell (selected
in the previous step). The right angle turn in this path is allowed only at occupied
cells and at the original unoccupied cell. Mark (+) and (-) sign alternatively at
each corner, starting from the original unoccupied cell.
Step-7:
1. Select the minimum value from cells marked with (-) sign of the
closed path.
2. Assign this value to selected unoccupied cell (So unoccupied cell
becomes occupied cell).
3. Add this value to the other occupied cells marked with (+) sign.
4. Subtract this value to the other occupied cells marked with (-)
sign.
Step-8: Repeat Step-2 to step-7 until optimal solution is obtained. This
procedure stops when all dij≥0 for unoccupied cells.
Optimal Solution
A feasible solution is said to be optimal solution when the total
transportation cost will be the minimum cost.
Occupied Cell: Occupied cell is a cell in Transportation Matrix where there
is an allocation.
Unoccupied Cell: Unoccupied cell is a cell in Transportation Matrix where
there is no allocation.
Example : Find the initial basic solution for the transportation problem and
hence solve it.
TRANSPORTATION
PROBLEM (TP) 59
Operations Research Transportation Problem
NOTES
Calculate the values of ui and vj, using the formula for occupied cells.
Assume any one of ui and vj value as zero (U3 is taken as 0)
TRANSPORTATION
PROBLEM (TP) 61
Operations Research Since all the opportunity cost, C ij values are positive the solution is
optimum.
Total transportation cost = (2 × 25) + (3 × 200) + (5 × 250) + (4 × 150) +
NOTES (3 × 50)+ (1 × 300)
= 50 + 600 +1250 + 600 + 150 + 300
= Rs 2,950/-
TRANSPORTATION
62 PROBLEM (TP)
Ex. The concept of MODI can be further comprehended through an Operations Research
illustration given below:
1. Initial basic feasible solution is given below
NOTES
TRANSPORTATION
PROBLEM (TP) 63
Operations Research Next step is to calculate the opportunity cost of the unoccupied cells (AF,
BD, BF, CD) by using the following formula:
NOTES
5. The matrix below shows the maximum allocation to the cell BD, and
that number of units are added to the cell with a positive sign and
subtracted from the cell with a negative sign.
6. Again, repeat the steps from 1 to 4 i.e. find out the opportunity costs
for each unoccupied cell and assign the maximum possible units to the
cell having the largest opportunity cost. This process will go on until
TRANSPORTATION
the optimum solution is reached.
64 PROBLEM (TP)
The Modified distribution method is an improvement over the stepping Operations Research
stone method since; it can be applied more efficiently when a large number of
sources and destinations are involved, which becomes quite difficult or tedious
in case of stepping stone method. NOTES
Modified distribution method reduces the number of steps involved in the
evaluation of empty cells, thereby minimizes the complexity and gives a
straightforward computational scheme through which the opportunity cost of
each empty cell can be determined.
Solution
TOTAL number of supply constraints : 3
TOTAL number of demand constraints : 3
TRANSPORTATION
PROBLEM (TP) 65
Operations Research Problem Table is
NOTES
Here Total Demand = 215 is less than Total Supply = 235. So we add a
dummy demand constraint with 0 unit cost and with allocation 20.
Now, The modified table is
Table-1
TRANSPORTATION
66 PROBLEM (TP)
he maximum penalty, 16, occurs in row S2. Operations Research
The minimum cij in this row is c24 = 0.
The maximum allocation in this cell is min(82,20) = 20.
NOTES
It satisfy demand of Dummy and adjust the supply of S2 from 82 to 62 (82
- 20 = 62).
Table-2
Table-3
NOTES
Table-5
TRANSPORTATION
68 PROBLEM (TP)
Table-6 Operations Research
NOTES
TRANSPORTATION
PROBLEM (TP) 69
Operations Research Demand Less than Supply
In real-life, supply and demand requirements will rarely be equal. This is
because of variation in production from the supplier end, and variations in
NOTES forecast from the customer end. Supply variations may be because of shortage
of raw materials, labour problems, Transportation Model improper planning and
scheduling. Demand variations may be because of change in customer
preference, change in prices and introduction of new products by competitors.
These unbalanced problems can be easily solved by introducing dummy
sources and dummy destinations. If the total supply is greater than the total
demand, a dummy destination (dummy column) with demand equal to the supply
surplus is added. If the total demand is greater than the total supply, a dummy
source (dummy row) with supply equal to the demand surplus is added. The unit
transportation cost for the dummy column and dummy row are assigned zero
values, because no shipment is actually made in case of a dummy source and
dummy destination.
Example : Check whether the given transportation problem shown in Table
is a balanced one. If not, convert the unbalanced problem into a balanced
transportation problem.
Solution: For the given problem, the total supply is not equal to the total
demand.
TRANSPORTATION
70 PROBLEM (TP)
The given problem is an unbalanced transportation problem. To convert the Operations Research
unbalanced transportation problem into a balanced problem, add a dummy
destination (dummy column). i.e., the demand of the dummy destination is equal
to, NOTES
Thus, a dummy destination is added to the table, with a demand of 100 units.
The modified table is shown in Table which has been converted into a balanced
transportation table. The unit costs of transportation of dummy destinations are
assigned as zero.
Similarly,
TRANSPORTATION
PROBLEM (TP) 71
Operations Research The given problem is an unbalanced one. To convert it into a balanced
transportation problem, include a dummy source (dummy row) as shown in Table
The sales price in Rs. Per unit and the demand in kgms per unit time
are as follows:
TRANSPORTATION
72 PROBLEM (TP)
Solution: The given problem is a transportation problem. The profit matrix Operations Research
for various factories and sales counters is calculated below:
NOTES
The above profit matrix can be converted into a loss matrix by subtracting
all its elements from the highest payoff of the matrix i.e. 5. The loss matrix so
obtained is given below.
TRANSPORTATION
PROBLEM (TP) 73
Operations Research The initial solution is obtained by applying Vogel’s approximation method.
NOTES
The initial solution is tested for optimality. The total number of independent
allocations is 6 which is one less than (m +n –1) allocations. Let us introduce a
small quantity e in the least cost independent cell (A, 3). We also introduce ui,
vj, i = (1,2,3,4,5); j = (1,2,3) such that Äij =Cij – (ui +vj) for allocation cells.
TRANSPORTATION
74 PROBLEM (TP)
We assume v2 = 0 and remaining vi’s, vj’s and Äij are calculated as below: Operations Research
NOTES
Since all Äij > 0 for the non allocated cells, hence the solution given by
above matrix is optimal. The optimal solution for the given problem is given
below:
Resolving degeneracy
In order to resolve degeneracy, the conventional method is to allocate an
infinitesimally small amount e to one of the independent cells i.e., allocate a
TRANSPORTATION
small positive quantity e to one or more unoccupied cell that have lowest PROBLEM (TP) 75
Operations Research transportation costs, so as to make m + n – 1 allocations (i.e., to satisfy the
condition N = m + n – 1).
In other words, the allocation of e should avoid a closed loop and should
NOTES not have a path. Once this is done, the test of optimality is applied and, if
necessary, the solution is improved in the normal was until optimality is reached.
The following table shows independent allocations.
Independent Allocations
Non-Independent Allocations
TRANSPORTATION
76 PROBLEM (TP)
Example : Find the initial basic feasible solution for the transportation Operations Research
problem given in Table.
Solution : The initial basic feasible solution using VAM is shown in table
below.
TRANSPORTATION
PROBLEM (TP) 77
Operations Research Resolving Degeneracy in Transportation Problem
Table shows the resolved degenerate table.
Transportation Problem
Solution
Step1: The initial basic feasible solution is found using Vogel’s
Approximation Method as shown in Table.
Non Degenerate basic feasible Solution in Transportation Problem
Total transportation cost = (19 × 5) + (10 × 2) + (40 × 7) + (60 × 2) + (8 ×
8) +(20 × 10)
= 95 + 20 + 280 + 120 + 64 + 200
TRANSPORTATION = Rs. 779.00
78 PROBLEM (TP)
Operations Research
NOTES
In Table the cell (2,2) has the most negative opportunity cost. This negative
cost has to be converted to a positive cost without altering the supply and demand
value.
TRANSPORTATION
PROBLEM (TP) 79
Operations Research Step 4: Construct a closed loop . Introduce a quantity + q in the most
negative cell (S2, D2 ) and a put – q in cell (S3, D2 ) in order to balance the
column D2. Now, take a right angle turn and locate an occupied cell in column
NOTES D4. The occupied cell is (S3, D4) and put a + q in that cell. Now, put a – q in cell
(S2, D4 ) to balance the column D4. Join all the cells to have a complete closed
path. The closed path is shown in Figure.
Closed Path
Now, identify the – q values, which are 2 and 8. Take the minimum value,
2 which is the allocating value. This value is then added to cells (S2, D2 ) and
(S3, D4 ) which have ‘+’signs and subtract from cells (S2, D4 ) and (S3, D2 )
which have ‘–’ signs. The process is shown in Figure.
Closed Path
TRANSPORTATION
80 PROBLEM (TP)
The table after reallocation is shown in Table below. Operations Research
After Reallocation
NOTES
TRANSPORTATION
PROBLEM (TP) 81
Operations Research The values of the opportunity cost cij are positive. Hence the optimality is
reached.
The final allocations are shown in Table.
NOTES
Final Allocation
V1 = – 19 V2 = 2 V3 = – 8 V4 = – 10
Total transportation cost = (19 × 5) + (10 × 2) + (30 × 2) + (40 × 7) + (8 ×
6) + (20 × 12)
= 95 + 20 + 60 + 280 + 48 + 240
= Rs. 743
TRANSPORTATION
82 PROBLEM (TP)
Note: It is not possible to transport any quantity from factory 2 to godown Operations Research
5. State whether the solution derived by you is unique.
Solution NOTES
The initial solution is found by VAM below
The above initial solution is tested for optimality. Since there are only 8
allocations and we require 9(m+n-1 =9) allocations, we put a small quantity in
the least cost independent cell (2, 6) and apply the optimality test. Let u3 = 0 and
then we calculate remaining ui and vj
Now we calculate ij = cij – (ui +vj) for non basic cells which are given
in the table below:
TRANSPORTATION
PROBLEM (TP) 83
Operations Research Since all ij are positive, the initial solution found by VAM is an optimal
solution. The final allocations are given below:
NOTES
Multiple Solutions to TP
It is possible for a transportation problem to have multiple optimal solutions.
This happens when one or more of the improvement indices zero in the optimal
solution. This means that it is possible to design alternative shipping routes with
the same total shipping cost The alternate optimal solution can be found by
shipping the most to this unused square using a stepping-stone path. In the real
world, alternate optimal solutions provide management with greater flexibility
in selecting and using resources
Example
Find Solution using Vogel's Approximation method, also find optimal
solution using modi method,
Solution
TOTAL number of supply constraints : 3
TRANSPORTATION
84 PROBLEM (TP) TOTAL number of demand constraints : 3
Problem Table is Operations Research
NOTES
Here Total Demand = 215 is less than Total Supply = 235. So We add a
dummy demand constraint with 0 unit cost and with allocation 20.
Now, The modified table is
Table-1
NOTES
Table-3
Table-4
TRANSPORTATION
86 PROBLEM (TP)
The maximum penalty, 24, occurs in row S2. Operations Research
The minimum cij in this row is c22 = 24.
The maximum allocation in this cell is min(21,102) = 21.
NOTES
It satisfy supply of S2 and adjust the demand of D2 from 102 to 81 (102 -
21 = 81).
Table-5
Table-6
TRANSPORTATION
PROBLEM (TP) 87
Operations Research Initial feasible solution is
NOTES
Allocation Table is
Iteration-1 of optimality test
1. Find ui and vj for all occupied cells(i,j), where cij=ui+vj
TRANSPORTATION
88 PROBLEM (TP)
Operations Research
NOTES
NOTES
*****
TRANSPORTATION
PROBLEM (TP) 91
Operations Research
UNIT - IV
ASSIGNMENT PROBLEM
NOTES
CHAPTER OBJECTIVES
1. To know the Assignment Problem Concept.
2. To understand Hungarian Method.
3. To Know Business applications of Assignment Problem.
CHAPTER CONTENTS
a) Meaning
b) Definition and applications of Assignment Problem
c) Hungarian Method
d) Assignment Problem for Maximization
e) Minimization. unbalanced AP, restricted AP
f) Multiple /Optimal Solutions
g) Business Applications
KEY WORDS
Assignment Problem, Hungarian Method, Special Cases
INTRODUCTION
The assignment problem is a particular class of transportation linear
programming problems with the supplies and demands equal to integers (often
1). Since all supplies, demands, and bounds on variables are integers, the
assignment problem relies on an interesting property of transportation problems
that the optimal solution will be entirely integers.
ASSIGNMENT
92 PROBLEM
Definition Operations Research
Suppose there are n jobs to be performed and n persons are available for
doing these jobs. Assume that each person can do each job at a term, though with
varying degree of efficiency, let cij be the cost if the i-th person is assigned to NOTES
the j-th job. The problem is to find an assignment (which job should be assigned
to which person one on-one basis) So that the total cost of performing all jobs is
minimum, problem of this kind are known as assignment problem.
Hungarian method
An assignment problem can be easily solved by applying Hungarian method
which consists of two phases. In the first phase, row reductions and column
reductions are carried out. In the second phase, the solution is optimized on
iterative basis.
Phase 1
Step 1: Consider the given matrix.
Step 2: In a given problem, if the number of rows is not equal to the number
of columns and vice versa, then add a dummy row or a dummy column. The
assignment costs for dummy cells are always assigned as zero.
Step 3: Reduce the matrix by selecting the smallest element in each row
and subtract with other elements in that row.
Phase 2
Step 4: Reduce the new matrix column-wise using the same method as
given in step 2.
Step 5: Draw minimum number of lines to cover all zeros.
Step 6: If Number of lines drawn = order of matrix, then optimally is
reached, so proceed to step 7: If optimally is not reached, then go to step 6.
Step8: Select the smallest element of the whole matrix, which is not covered
by lines. Subtract this smallest element with all other remaining elements that
are not covered by lines and add the element at the intersection of lines. Leave
the elements covered by single line as it is. Now go to step 4.
Step 7: Take any row or column which has a single zero and assign by
squaring it. Strike off the remaining zeros, if any, in that row and column (X).
Repeat the process until all the assignments have been made.
Step 8: Write down the assignment results and find the minimum cost/time.
Note: While assigning, if there is no single zero exists in the row or column,
choose any one zero and assign it. Strike off the remaining zeros in that column
ASSIGNMENT or row, and repeat the same for other assignments also. If there is no single zero
94 PROBLEM
allocation, it means multiple numbers of solutions exist. But the cost will remain Operations Research
the same for different sets of allocations.
Example 1 NOTES
Consider three jobs to be assigned to three machines. The cost for each
combination is shown in the table below. Determine the minimal job – machine
combinations.
Table 1
Solution
Step 1
Create zero elements in the cost matrix (zero assignment) by subtracting
the smallest element in each row (column) from the corresponding row (column).
After this exercise, the resulting cost matrix is obtained by subtracting 5 from
row 1, 10 from row 2 and 13 from row 3.
Table 2
ASSIGNMENT
PROBLEM 95
Operations Research Step 2
Repeating the same with columns, the final cost matrix is
NOTES Table 3
The italicized zero elements represent a feasible solution. Thus the optimal
assignment is (1,1), (2,3) and (3,2). The total cost is equal to 60 (5 +12+13).
In the above example, it was possible to obtain the feasible assignment. But
in more complicated problems, additional rules are required which are explained
in the next example.
Example 2
Consider four jobs to be assigned to four machines. The cost for each
combination is shown in the table below. Determine the minimal job – machine
combinations.
Table 4
ASSIGNMENT
96 PROBLEM
Solution Operations Research
Step 1: Create zero elements in the cost matrix by subtracting the smallest
element in each row from the corresponding row.
NOTES
Table 5
Step 2: Repeating the same with columns, the final cost matrix is
Table 6
Rows 1 and 3 have only one zero element. Both of these are in column 1,
which means that both jobs 1 and 3 should be assigned to machine 1. As one
machine can be assigned with only one job, a feasible assignment to the zero
elements is not possible as in the previous example.
Step 3: Draw a minimum number of lines through some of the rows and
columns so that all the zeros are crossed out.
ASSIGNMENT
PROBLEM 97
Operations Research Table 7
NOTES
Table 8
This gives a feasible assignment (1,1), (2,3), (3,2) and (4,4) with a total cost
of 1+10+5+5 = 21.If the optimal solution had not been obtained in the last step,
then the procedure of drawing lines has to be repeated until a feasible solution is
achieved.
ASSIGNMENT
PROBLEM 99
Operations Research Column-wise reduction is not necessary since all columns contain a single
zero. Now, draw minimum number of lines to cover all the zeros, as shown in
Table.
NOTES
All Zeros in the Matrix Covered
ASSIGNMENT
100 PROBLEM
Again Added or Subtracted 1 from Elements Operations Research
NOTES
ASSIGNMENT
PROBLEM 101
Operations Research Restricted Route Assignment Problem
It is sometimes possible that a particular person is incapable of doing certain
work or a specific job cannot be performed on a particular machine. The solution
NOTES of the assignment problem should take into account these restrictions so that the
restricted (infeasible) assignment can be avoided. This can be achieved by
assigning a very high cost (say ∞ or M)to the cells where assignments are
prohibited, thereby restricting the entry of this pair of job-machine or resource-
activity into the final solution.
Example : In a plant layout, four different machines M1, M2, M3 and M4
are to be erected in a machine shop. There are five vacant areas A, B, C, D and
E. Because of limited space, Machine M2 cannot be erected at area C and
Machine M4 cannot be erected at area A. The cost of erection of machines is
given in the Table.
Assignment Problem
ASSIGNMENT
102 PROBLEM Row-wise reduction of the matrix is shown in Table.
Matrix Reduced Row-wise Operations Research
NOTES
Number of lines drawn ≠ Order of matrix. Hence not Optimal. Select the
smallest uncovered element, in this case 1. Subtract 1 from all other uncovered
element and add 1 with the elements at the intersection. The element covered by
single line remains unchanged. These changes are shown in Table. Now try to
draw minimum number of lines to cover all the zeros.
ASSIGNMENT
PROBLEM 103
Operations Research Now number of lines drawn = Order of matrix, hence optimality is reached.
Optimal assignment of machines to areas are shown in Table.
Maximization Problem
ASSIGNMENT
PROBLEM 105
Operations Research Number of lines drawn ≠ Order of matrix. Hence not optimal.
Select the least uncovered element, i.e., 4 and subtract it from other
uncovered elements, add it to the elements at intersection of line and leave the
NOTES elements that are covered with single line unchanged, Table.
Therefore,
ASSIGNMENT
106 PROBLEM
Multiple Solutions Operations Research
While making assignment in the reduced assignment matrix, it is possible
to have two or more ways to strike off certain number of zeroes. Such a situation
indicates multiple solutions with the same optimal value of the objective function. NOTES
If the problem has only one solution then the solution is said to be Unique
solution.
QUESTIONS
Q.1 What is Assignment Problem?
Q.2 Explain Formulation of Assignment Problem.
ASSIGNMENT
PROBLEM 107
Operations Research Q.3 Discuss the following with respect to Assignment Problem
a) Hungarian Method
Q.6 Four jobs (J1, J2, J3, and J4) need to be executed by four workers (W1,
W2, W3, and W4), one job per worker. The matrix below shows the
cost of assigning a certain worker to a certain job. Assign the jobs so
as to minimize the total cost of the assignment.
*****
ASSIGNMENT
108 PROBLEM
Operations Research
UNI - V NOTES
SIMULATION
CHAPTER OBJECTIVES
1. To know the concept of Simulation.
2. To understand advantages of Simulation.
3. To know the Monte Carlo Simulation Technique
CHAPTER CONTENTS
a) Introduction to Simulation
b) Monte Carlo technique
c) business applications and limitations.
KEY WORDS
Simulation, Monte Carlo Technique
INTRODUCTION
SIMULATION 111
Operations Research
2. Entities
Customers, resources, service facilities, materials, service personnel,
etc., are entities. Each type of entity has a set of relevant attributes. In
our service station example, the entities are cars, with the attributes
arrival time and ‘number of liters needed, and pumps, with the attribute
time to the completion of service to the current customer.
3. Events
Events are occurrences that alter the system state. Here the events are
the arrival of a customer at the station, the start-of-service to a
customer at a pump, and the completion-of- service to a customer at a
pump. The first arrival event must be scheduled in the initialization
routine; the remaining arrivals are handled by letting each invocation
of the arrival routine schedule the next arrival event. The scheduling
112 SIMULATION
of a start-of-service event takes place either in the arrival routine, if Operations Research
there are no other cars waiting and a pump is available, or in the
completion-of service routine, otherwise. Each time the start-of-service
routine is invoked, the completion-of-service at that pump is NOTES
scheduled.
Besides the types of events identified in the real system, there are two
other pseudo-events that should be included in every simulation
program. End-of-simulation halts the simulation after a certain amount
of simulated time has elapsed, and initiates the final output of the
statistics and measurements gathered in the run. End-of simulation
should be scheduled during the initialization of an event-driven
simulation; for time-driven simulations, it is determined by the upper
bound of the basic program loop. A progress-report event allows a
summary of statistics and measurements to be printed after specified
intervals of simulated time have elapsed. These progress-report
summaries can be used to check the validity of the program during its
development, and also to show whether or not the system is settling
down to some sort of equilibrium (i.e., stable) behavior.
4. Groupings
Similar entities are often grouped in meaningful ways. Sometimes an
ordering of the entities within a group is relevant. In the service station
example, the groupings are available pumps (that are not currently
serving any auto), busy pumps (ordered by the service completion time
for the customer in service), and autos awaiting service (ordered by
time of arrival). In a Turing program, such groupings can be
represented as linked lists of records, as long as a suitable link field is
included in the records for that entity type.
5. Relationships
Pairs of non-similar entities may be related. For example, a busy pump
is related to the auto that is being served. Relationships can be
indicated by including in the record for one of the entities in a pair a
link to the other entity. In some cases, it may be desirable for each of
the entities in the pair to have a link to the other entity. For example,
the relationship between a busy pump and the auto being served can
be represented by a link from the pump record to the corresponding
auto record.
6. Stochastic Simulation
In a stochastic simulation, certain attributes of entities or events must
be chosen at random from some probability distribution. In the service
station example, these include the customer inter arrival times (i.e.,
the times between successive arrivals), the number of liters needed,
SIMULATION 113
Operations Research the service time (based on the number of liters needed), and whether
the customer decides to balk (based on the length of the waiting queue
and the number of liters needed).
NOTES
7. Strategies
Typically, a simulation experiment consists of comparing several
alternative approaches to running the system to find out which one(s)
maximize some measure of system performance. In the case of the
service station, the strategies consist of keeping different numbers of
pumps in service.
8. Measurements
The activity of the system will be reflected in measurements associated
with entities, events, groups, or relationships. Such measurements are
used in specifying the performance of the system. If the measurement
is associated with an entity, it should be recorded in a field contained
within the record for that entity. For measurements associated with
events, groupings or relationships, additional variables or records must
be declared to record the measured quantities.
Advantages
For most companies, the benefits of using simulation go beyond just
providing a look into the future and are included in the following:
Choose Correctly. Simulation lets you test every aspect of a proposed
114 SIMULATION change or addition without committing resources to their acquisition. This is
critical, because once the hard decisions have been made, the bricks have been Operations Research
laid, or the material-handling systems have been installed, changes and
corrections can be extremely expensive. Simulation allows to test the designs
without committing resources to acquisition. NOTES
Time Compression and Expansion. By compressing or expanding time
simulation allows to speed up or slow down phenomena so that you can
thoroughly investigate them. One can examine an entire shift in a matter of
minutes if one desire, or can spend two hours examining all the events that
occurred during one minute of simulated activity.
Explore Possibilities. One of the greatest advantages of using simulation
software is that once developed a valid simulation model, one can explore new
policies, operating procedures, or methods without the expense and disruption
of experimenting with the real system. Modifications are incorporated in the
model, and you observe the effects of those changes on the computer rather than
the real system.
Diagnose Problems. The modern factory floor or service organization is
very complex. So complex that it is impossible to consider all the interactions
taking place in one given moment. Simulation allows to better understand the
interactions among the variables that make up such complex systems. Diagnosing
problems and gaining insight into the importance of these variables increases
understanding of their important effects on the performance of the overall system.
The last three claims can be made for virtually all modeling activities,
queuing, linear programming, etc. However, with simulation the models can
become very complex and, thus, have a higher fidelity, i.e., they are valid
representations of reality.
Identify Constraints. Production bottlenecks give manufacturers
headaches. It is easy to forget that bottlenecks are an effect rather than a cause.
However, by using simulation to perform bottleneck analysis, you can discover
the cause of the delays in work-in-process, information, materials, or other
processes.
Develop Understanding. Many people operate with the philosophy that
talking loudly, using computerized layouts, and writing complex reports
convinces others that a manufacturing or service system design is valid. In many
cases these designs are based on someone's thoughts about the way the system
operates rather than on analysis. Simulation studies aid in providing
understanding about how a system really operates rather than indicating an
individual's predictions about how a system will operate.
Visualize the Plan. Taking designs beyond CAD drawings by using the
animation features offered by many simulation packages allows you to see your
facility or organization actually running. Depending on the software used, one
may be able to view your operations from various angles and levels of
magnification, even 3-D. This allows to detect design flaws that appear credible
when seen just on paper on in a 2-D CAD drawing. SIMULATION 115
Operations Research Build Consensus. Using simulation to present design changes creates an
objective opinion. One can avoid having inferences made when it is approved or
disapproved of designs because one can simply select the designs and
NOTES modifications that provided the most desirable results, whether it be increasing
production or reducing the waiting time for service. In addition, it is much easier
to accept reliable simulation results, which have been modeled, tested, validated,
and visually represented, instead of one person's opinion of the results that will
occur from a proposed design.
Prepare for Change. Answering all of the "what-if" questions is useful for
both designing new systems and redesigning existing systems. Interacting with
all those involved in a project during the problem- formulation stage gives an
idea of the scenarios that are of interest. Then one can construct the model so
that it answers questions pertaining to those scenarios.
Wise Investment. The typical cost of a simulation study is substantially
less than 1% of the total amount being expended for the implementation of a
design or redesign. Since the cost of a change or modification to a system after
installation is so great, simulation is a wise investment.
Train the Team. Simulation models can provide excellent training when
designed for that purpose. Used in this manner, the team provides decision inputs
to the simulation model as it progresses. The team, and individual members of
the team, can learn by their mistakes, and learn to operate better. This is much
less expensive and less disruptive than on-the-job learning.
Specify Requirements. Simulation can be used to specify requirements for
a system design. For example, the specifications for a particular type of machine
in a complex system to achieve a desired goal may be unknown. By simulating
different capabilities for the machine, the requirements can be established.
B. Disadvantages
The disadvantages of simulation include the following
Model Building Requires Special Training. It is an art that is learned over
time and through experience. Furthermore, if two models of the same system are
constructed by two competent individuals, they may have similarities, but it is
highly unlikely that they will be the same.
Simulation Results May Be Difficult to Interpret. Since most simulation
outputs are essentially random variables (they are usually based on random
inputs), it may be hard to determine whether an observation is a result of system
interrelationships or randomness.
Simulation Modeling and Analysis Can Be Time Consuming and
Expensive.
Skimping on resources for modeling and analysis may result in a simulation
model and/or analysis that is not sufficient for the task.
116 SIMULATION
Simulation May Be Used Inappropriately. Simulation is used in some cases Operations Research
when an analytical solution is possible, or even preferable. This is particularly
true in the simulation of some waiting lines where closed-form queueing models
are available, at least for long-run evaluation. NOTES
1. Problem formulation
Every simulation study begins with a statement of the problem. If the
statement is provided by those that have the problem (client), the
simulation analyst must take extreme care to insure that the problem
is clearly understood. If a problem statement is prepared by the
simulation analyst, it is important that the client understand and agree
with the formulation. It is suggested that a set of assumptions be
prepared by the simulation analyst and agreed to by the client. Even
with all of these precautions, it is possible that the problem will need
to be reformulated as the simulation study progresses.
3. Model conceptualization
The real-world system under investigation is abstracted by a
conceptual model, a series of mathematical and logical relationships
concerning the components and the structure of the system. It is
recommended that modeling begin simply and that the model grow
until a model of appropriate complexity has been developed. For
example, consider the model of a manufacturing and material handling
system. The basic model with the arrivals, queues and servers is
118 SIMULATION
constructed. Then, add the failures and shift schedules. Next, add the Operations Research
material-handling capabilities. Finally, add the special features.
Constructing an unduly complex model will add to the cost of the study
and the time for its completion without increasing the quality of the NOTES
output. Maintaining client involvement will enhance the quality of the
resulting model and increase the client's confidence in its use.
4. Data collection
Shortly after the proposal is accepted a schedule of data requirements
should be submitted to the client. In the best of circumstances, the
client has been collecting the kind of data needed in the format
required, and can submit these data to the simulation analyst in
electronic format. Oftentimes, the client indicates that the required data
are indeed available. However, when the data are delivered they are
found to be quite different than anticipated.
5. Model translation
The conceptual model constructed in Step 3 is coded into a computer
recognizable form, an operational model.
6. Verification
Verification concerns the operational model. Is it performing properly.
Even with small textbook sized models, it is quite possible that they
have verification difficulties. It is highly advisable that verification
take place as a continuing process. It is ill advised for the simulation
analyst to wait until the entire model is complete to begin the
verification process. Also, use of an interactive run controller, or
debugger, is highly encouraged as an aid to the verification process.
7. Validation
Validation is the determination that the conceptual model is an accurate
representation of the real system.
8. Experimental design
For each scenario that is to be simulated, decisions need to be made
concerning the length of the simulation run, the number of runs (also
called replications), and the manner of initialization, as required.
12. Implementation
The simulation analyst acts as a reporter rather than an advocate. The
report prepared in step 11 stands on its merits, and is just additional
information that the client uses to make a decision. If the client has
been involved throughout the study period, and the simulation analyst
has followed all of the steps rigorously, then the likelihood of a
successful implementation is increased.
Example
Akshay Bakery maintains sufficient stock of cake. The daily demand is
given below:
Using the following sequence of random numbers, simulate the demand for
the next 12 days. If the proprietor of the bakery decides to make 40 cakes
everyday, calculate the stock position at the end of the 12th day. Also calculate
the daily average demand for the cakes.
Random Numbers: 36,29,84,57,19,79,46,67,08,81,87,94
Solution
120 SIMULATION
Operations Research
NOTES
Ten random numbers that have been selected from random number tables
are 68, 47, 92, 76, 86, 46, 16, 28, 35, 54. To find the demand for ten days see the
Table below.
SIMULATION 121
Operations Research Table 5.1: Ten Random Numbers Selected
NOTES
Average demand =28/10 =2.8 washing machines per day. The expected
demand /day can be computed as,
Expected demand per day
Simulation Problem
122 SIMULATION
b. Due to fluctuating market price, the price per kg of tomatoes varies Operations Research
from Rs. 5.00 to Rs. 10.00 per kg. The probability of price variations
is given in the Table below. Simulate the price for next 12 months to
determine the revenue per acre. Also find the average revenue per acre. NOTES
Use the following random numbers 53, 74, 05, 71, 06, 49, 11, 13, 62,
69, 85 and 69.
Simulation Problem
Solution
SIMULATION 123
Operations Research Simulation Problem
NOTES
Simulate and find the average number of pizzas produced more than the
requirement and the average number of shortage of pizzas supplied to the outlet.
Solution: Assign two digit random numbers to the demand levels as shown
in table
Selecting 15 random numbers from random numbers table and simulate the
production per day as shown in table below.
QUESTIONS
Q.1 What is Simulation? Explain advantages of Simulation.
Q.2 Discuss Monte Carlo Simulation Technique.
Q3 Explain Simulation Modelling.
4. Explain Monte Carlo Simulation Technique pointing out its uses in
Operations Research.
5. An ice-cream parlor's record of previous month’s sale of a particular
variety of ice cream as follows:
*****
SIMULATION 125
Operations Research
UNIT - VI
NETWORK ANALYSIS
NOTES
CHAPTER OBJECTIVES
1. To equip students with fundamentals of Network Analysis
2. To acquaint the students with PERT and CPM Techniques.
3. To enable the students to determine Critical Path.
CHAPTER CONTENTS
a) PERT and CPM techniques
b) Introduction to Networks
c) key terms in Network Analysis
d) Network models − PERT/CPM network components and precedence
relationships.
e) Critical Path Method (CPM), Program Evaluation and Review
Technique (PERT).
f) Determination of PERT times
g) Determining the critical path − determining the floats and slacks.
KEY WORDS
Network Analysis, PERT, CPM, Critical Path
INTRODUCTION TO NETWORKS
One of the most challenging jobs that any manager can take on is the
management of a large-scale project that requires coordinating numerous
activities throughout the organi-zation. A myriad of details must be considered
in planning how to coordinate all these activities, in developing a realistic
schedule, and then in monitoring the progress of the project.
Fortunately, two closely related operations research techniques, PERT
(program evaluation and review technique) and CPM (critical path method), are
126 NETWORK ANALYSIS available to assist the project manager in carrying out these responsibilities. These
techniques make heavy use of networks (as introduced in the preceding chapter) Operations Research
to help plan and display the coordination of all the activities. They also normally
use a software package to deal with all the data needed to develop schedule
information and then to monitor the progress of the project. NOTES
PERT and CPM have been used for a variety of projects, including the
following types:
1. Construction of a new plant
2. Research and development of a new product
3. NASA space exploration projects
4. Movie productions
5. Building a ship
6. Government-sponsored projects for developing a new weapons system
7. Relocation of a major facility
8. Maintenance of a nuclear reactor
9. Installation of a management information system
10. Conducting an advertising campaign
A project is defined by a set of activities. Each activity is defined by its
duration (time to complete the activity) and its predecessors (activities that must
be completed before the activity can start). CPM (Critical Path Method) is used
to assist the project manager in scheduling the activities (i.e., when should each
activity start). It assumes that activity durations are known with certainty.
PERT (Program Evaluation and Review Technique) is used to assist in
project scheduling similar to CPM. However, PERT assumes that activity
durations are random variables (i.e., probabilistic)
The first step in CPM/PERT is to construct a project network. In the project
network each activity is represented by an arc connected by two nodes. The first
node represents the start of the activity and the second node represents the end
of it.
Activity
Solution
Solution: The network diagram for the given problem is shown in Figure
with activities A, B and C starting simultaneously.
Network Diagram
Network Diagram
Procedure
Step 1: Begin from the start event and move towards the end event.
Step 2: Put TE = 0 for the start event.
Step 3: Go to the next event (i.e node 2) if there is an incoming activity for
event 2, add calculate TE of previous event (i.e event 1) and activity time.
Note: If there are more than one incoming activities, calculate TE for all
incoming activities and take the maximum value. This value is the TE for event 2.
Step 4: Repeat the same procedure from step 3 till the end event.
Procedure
NOTES Step 1: Begin from end event and move towards the start event. Assume
that the direction of arrows is reversed.
Step 2: Latest Time TL for the last event is the earliest time. TE of the last
event.
Step 3: Go to the next event, if there is an incoming activity, subtract the
value of TL of previous event from the activity duration time. The arrived value
is TL for that event. If there are more than one incoming activities, take the
minimum TE value.
Step 4: Repeat the same procedure from step 2 till the start event.
Project Schedule
Solution
(i) From the data given in the problem, the activity network is constructed
as shown in the following figure.
NOTES
(ii) To determine the critical path, compute the earliest, time T Network
Model E and latest time TL for each of the activity of the project. The
calculations of TE and TL are as follows:
To calculate TEfor all activities,
NOTES
Various Activities and their Floats
The critical path is 1-3-5-7-8-10 (shown in double line in the above figure)
with the project duration of 22 days.
Optimistic time tO
It is the shortest time taken to complete the activity. It means that if
everything goes well then there is more chance of completing the activity within
this time.
...............(7)
Probability of completing the project within the scheduled time is,
P (T≤ Ts) = P ( Z≤ Z0 ) (from normal tables) .................(8)
Example : An R & D project has a list of tasks to be performed whose time
estimates are given in the table, as follows.
Time expected for each activity is calculated using the formula (5):
Ta= t0+4tm+tp/6
= 4+4(6)+8/6 = 36/6 = 6 days for activity A
Similarly, the expected time is calculated for all the activities. The variance
of activity time is calculated using the formula (6).
NOTES
Solution
Calculate the time average ta and variances of each activity as shown in the
following table.
NOTES
From the network diagram Figure, the critical path is identified as 1-4, 4-6,
6-7, with project duration of 22 days. The probability of completing the project
within 19 days is given by,
Determine the critical path, the critical activities and the project completion time.
140 NETWORK ANALYSIS
7) Two experts A and B examined an activity and arrived at the following Operations Research
time estimates.
NOTES
BIBLIOGRAPHY
1. Operations Research- Aditham B. Rao, Jaico Publishing House, 1st
edition
2. Operations Research- S.D.Sharma, Kedar Nath Ram Nath & Co.
Publishers, Meerut, 10th edition
3. Frederick S. Hillier & Gerald J. Lieberman, Introduction to Operations
Research, McGraw-Hill: Boston MA; 10th Edition, 2014
4. Taha, Hamdy A., "Operations Research: An Introduction", Pearson,
10th Edition, 2016
5. Robert J. Thierauf & Richard A. Grosse, "Decision Making Through
Operations Research", John Wiley & Sons, INC, 1970
6. Harvey M. Wagner, Principles of Operations Research, Englewood
Cliffs, Prentice-Hall
7. International Journal of Operations Research and Information Systems
(IJORIS)
8. https://staff.aub.edu.lb
9. https://www.math.upatras.gr
10. https://nptel.ac.in
11. https://hithaldia.in
12. https://businessjargons.com
13. https://www.wisdomjobs.com
14. https://www.coursehero.com
*****