Quantitative Methods

MM ZG515 / QM ZG515
L11.1: Transportation Problem
L11.2: Assignment Problem
BITS Pilani Srinivas Kota
Work Integrated Learning 
Programmes Division
 Transportation Problem
Boston
Cleveland (200 units
(200 units required)
Des Moines required)
(100 units
capacity)

Albuquerque
(300 units
required) Evansville
(300 units
capacity)

Fort Lauderdale
From To Albuquerque Boston Cleveland (300 units
capacity)
Des Moines 5 4 3
Evansville 8 4 3
Fort Lauderdale 9 7 5

2 MM ZG515/QMZG515 Quantitative Methods BITS Pilani WILPD

 Transportation Modeling
• An interactive procedure that finds the least costly means
of moving products from a series of sources to a series of
destinations
• Can be used to help resolve distribution and location
decisions
• A special class of linear programming
• Need to know

1. The origin points and the capacity

or supply per period at each
2. The destination points and the
demand per period at each
3. The cost of shipping one unit from
each origin to each destination
3 MM ZG515/QMZG515 Quantitative Methods BITS Pilani WILPD
 Transportation Matrix

To Factory Des Moines

Albuquerque Boston Cleveland capacity capacity
From constraint
5 4 3
Des Moines 100
Cell
representing
8 4 3 a possible
Evansville 300 source-to-
destination
9 7 5 shipping
Fort Lauderdale 300 assignment
(Evansville
to Cleveland)
Warehouse
requirement 300 200 200 700

Cost of shipping 1 unit from Fort Cleveland Total demand

Lauderdale factory to Boston warehouse warehouse demand and total supply

4 MM ZG515/QMZG515 Quantitative Methods BITS Pilani WILPD

 Northwest-Corner Rule
• Start in the upper left-hand cell (or northwest
corner) of the table and allocate units to shipping
routes as follows:
1. Exhaust the supply (factory capacity) of each row
before moving down to the next row
2. Exhaust the (warehouse) requirements of each column
before moving to the next column
3. Check to ensure that all supplies and demands are met

5 MM ZG515/QMZG515 Quantitative Methods BITS Pilani WILPD

 Northwest-Corner Rule

To Factory
From Albuquerque Boston Cleveland capacity

5 4 3
Des Moines 100

8 4 3
Evansville 300

9 7 5
Fort Lauderdale 300

Warehouse
requirement 300 200 200 700

6 MM ZG515/QMZG515 Quantitative Methods BITS Pilani WILPD

 Northwest-Corner Rule
Computed Shipping Cost
Route
From To Tubs Shipped Cost per Unit Total Cost
D A 100 5 500
E A 200 8 1,600
E B 100 4 400
F B 100 7 700
F C 200 5 1,000
Total: 4,200
This is a feasible solution but
not necessarily the lowest
cost alternative

7 MM ZG515/QMZG515 Quantitative Methods BITS Pilani WILPD

 Intuitive Lowest-Cost Method
1. Identify the cell with the lowest cost
2. Allocate as many units as possible to that cell
without exceeding supply or demand; then cross
out the row or column (or both) that is exhausted
by this assignment
3. Find the cell with the lowest cost from the
remaining cells
4. Repeat steps 2 and 3 until all units have been
allocated

8 MM ZG515/QMZG515 Quantitative Methods BITS Pilani WILPD

 Intuitive Lowest-Cost Method

To Factory
From Albuquerque Boston Cleveland capacity

5 4 3
Des Moines 100

8 4 3
Evansville 300

9 7 5
Fort Lauderdale 300
This is a feasible solution,
Warehouse
requirement 300 200 and 200
an improvement
700 over
the previous solution, but not
necessarily the lowest cost
alternative
9 MM ZG515/QMZG515 Quantitative Methods BITS Pilani WILPD
 Stepping-Stone Method
1. Select any unused square to evaluate
2. Beginning at this square, trace a closed path back to the
original square via squares that are currently being used
3. Beginning with a plus (+) sign at the unused corner, place
alternate minus and plus signs at each corner of the path
just traced
4. Calculate an improvement index by first adding the unit-
cost figures found in each square containing a plus sign
and subtracting the unit costs in each square containing a
minus sign
5. Repeat steps 1 though 4 until you have calculated an
improvement index for all unused squares. If all indices
are ≥ 0, you have reached an optimal solution.
10 MM ZG515/QMZG515 Quantitative Methods BITS Pilani WILPD
 Stepping-Stone Method

To (A) (B) (C) Factory

From Albuquerque Boston Cleveland capacity

5 4 3
(D) Des Moines 100
- +
100 Des Moines-
(E) Evansville 200
8
100
4 3
300 Boston index
+ -
(F) Fort Lauderdale
9
100
7
200
5
300 =4-5+8-4
Warehouse
requirement 300 200 200 700 = +3

99 5 1 4
100
- +

201
+ 8 99
- 4
200 100

11 MM ZG515/QMZG515 Quantitative Methods BITS Pilani WILPD

 Stepping-Stone Method

To (A) (B) (C) Factory

From Albuquerque Boston Cleveland capacity

5 4 Start 3
(D) Des Moines 100 100
- +
8 4 3
(E) Evansville 200 100 300
+ -
9 7 5
(F) Fort Lauderdale 100 200 300
+ -
Warehouse
requirement 300 200 200 700

Des Moines-Cleveland index

= 3 - 5 + 8 - 4 + 7 - 5 = +4
12 MM ZG515/QMZG515 Quantitative Methods BITS Pilani WILPD
 Stepping-Stone Method

To (A) (B) (C) Factory

From Albuquerque Boston Cleveland capacity

5 4 3
(D) Des Moines 100 100

(E) Evansville
Evansville-Cleveland
200
8
100
4 index
3
300
= 3 - 4 + 7 - 5 = +1
9 7 5
(F) Fort Lauderdale (Closed path = EC - EB + FB
100 200 300- FC)

Warehouse Fort Lauderdale-Albuquerque index

requirement 300 200 200 700
= 9 - 7 + 4 - 8 = -1
(Closed path = FA - FB + EB - EA)

13 MM ZG515/QMZG515 Quantitative Methods BITS Pilani WILPD

 Stepping-Stone Method
1. If an improvement is possible, choose the route
(unused square) with the largest negative
improvement index
2. On the closed path for that route, select the
smallest number found in the squares containing
minus signs
3. Add this number to all squares on the closed path
with plus signs and subtract it from all squares
with a minus sign

14 MM ZG515/QMZG515 Quantitative Methods BITS Pilani WILPD

 Stepping-Stone Method
To (A) (B) (C) Factory
From Albuquerque Boston Cleveland capacity

5 4 3
(D) Des Moines 100 100

8 4 3
(E) Evansville 200 100 300
- +
9 7 5
(F) Fort Lauderdale 100 200 300
+ -
Warehouse
requirement 1.
300 Add 100
200units on
200 route700
FA
2. Subtract 100 from routes FB
3. Add 100 to route EB
4. Subtract 100 from route EA

15 MM ZG515/QMZG515 Quantitative Methods BITS Pilani WILPD

 Stepping-Stone Method
To (A) (B) (C) Factory
From Albuquerque Boston Cleveland capacity

5 4 3
(D) Des Moines 100 100

8 4 3
(E) Evansville 100 200 300

9 7 5
(F) Fort Lauderdale 100 200 300

Warehouse
requirement 300 200 200 700

Total Cost = 5(100) + 8(100) + 4(200) + 9(100) + 5(200)

= 4,000

16 MM ZG515/QMZG515 Quantitative Methods BITS Pilani WILPD

 Special Issues in Modeling
• Demand not equal to supply
• Called an unbalanced problem
• Common situation in the real world
• Resolved by introducing dummy sources or
dummy destinations as necessary with cost
coefficients of zero

17 MM ZG515/QMZG515 Quantitative Methods BITS Pilani WILPD

 Special Issues in Modeling
Total Cost = 250(5) + 50(8) + 200(4) + 50(3) + 150(5) + 150(0)
= 3,350
To (A) (B) (C) Factory
Dummy capacity
From Albuquerque Boston Cleveland

5 4 3 0
(D) Des Moines 250 250

8 4 3 0
(E) Evansville 50 200 50 300

9 7 5 0
(F) Fort Lauderdale 150 150 300

Warehouse
requirement 300 200 200 150 850

New
Des Moines
capacity
18 MM ZG515/QMZG515 Quantitative Methods BITS Pilani WILPD
 Special Issues in Modeling
• Degeneracy
• To use the stepping-stone methodology, the
number of occupied squares in any solution
must be equal to the number of rows in the
table plus the number of columns minus 1
• If a solution does not satisfy this rule it is
called degenerate

19 MM ZG515/QMZG515 Quantitative Methods BITS Pilani WILPD

 Special Issues in Modeling
To
Customer 1 Customer 2 Customer 3 Warehouse
From supply

8 2 6
Warehouse 1 100 100

10 9 9
Warehouse 2 0 100 20 120

7 10 7
Warehouse 3 80 80

Customer
demand 100 100 100 300

Initial solution is degenerate

Place a zero quantity in an unused square and
proceed computing improvement indices

20 MM ZG515/QMZG515 Quantitative Methods BITS Pilani WILPD

 Practice
Find an initial solution to the following transportation problem.
To
From Los Angeles Calgary Panama city Supply
Mexico city 6 18 8 100
Detroit 17 13 19 60
Ottawa 20 10 24 40
Demand 50 80 70

• Use the northwest corner method. What is its total cost?

• Use the intuitive lowest cost approach. What is its total cost?
• Using the stepping stone method find the optimal solution.
Compute the total cost

21 MM ZG515/QMZG515 Quantitative Methods BITS Pilani WILPD

 To
From
Los Angeles Calgary Panama city Supply

Mexico city 6 18 8
100

Detroit 17 13 19
60

Ottawa 20 10 24
40

Demand 50 80 70

To
From
Los Angeles Calgary Panama city Supply

Mexico city 6 18 8
100

Detroit 17 13 19
60

Ottawa 20 10 24
40

Demand 50 80 70

22 MM ZG515/QMZG515 Quantitative Methods BITS Pilani WILPD

 Quantitative Methods
MM ZG515 / QM ZG515

L11.2: Assignment Problem
BITS Pilani
Work Integrated Learning  Srinivas Kota
Programmes Division
 Assignment Method

• A special class of linear programming models that

assign tasks or jobs to resources
• Objective is to minimize cost or time
• Only one job (or worker) is assigned to one
machine (or project)

24 MM ZG515/QMZG515 Quantitative Methods BITS Pilani WILPD

 Assignment Method
• Build a table of costs or time associated with
particular assignments

Typesetter
Job A B C
R-34 11 14 6
S-66 8 10 11
T-50 9 12 7

25 MM ZG515/QMZG515 Quantitative Methods BITS Pilani WILPD

 Assignment Method
1. Create zero opportunity costs by repeatedly subtracting
the lowest costs from each row and column
2. Draw the minimum number of vertical and horizontal lines
necessary to cover all the zeros in the table. If the number
of lines equals either the number of rows or the number of
columns, proceed to step 4. Otherwise proceed to step 3.
3. Subtract the smallest number not covered by a line from
all other uncovered numbers. Add the same number to any
number at the intersection of two lines. Return to step 2.
4. Optimal assignments are at zero locations in the table.
Select one, draw lines through the row and column
involved, and continue to the next assignment.

26 MM ZG515/QMZG515 Quantitative Methods BITS Pilani WILPD

 Assignment Example
Typesetter
A B C
Job
R-34 11 14 6
S-66 8 10 11
T-50 9 12 7

27 MM ZG515/QMZG515 Quantitative Methods BITS Pilani WILPD

 Assignment Example
Typesetter
A B C
Job
R-34 11 14 6
S-66 8 10 11
T-50 9 12 7

Step 1a - Rows Step 1b - Columns

Typesetter Typesetter
A B C A B C
Job Job
R-34 5 8 0 R-34 5 6 0
S-66 0 2 3 S-66 0 0 3
T-50 2 5 0 T-50 2 3 0

28 MM ZG515/QMZG515 Quantitative Methods BITS Pilani WILPD

 Assignment Example

Step 2 - Lines The smallest uncovered

number is 2 so this is
Typesetter subtracted from all other
A B C uncovered numbers and
Job added to numbers at the
R-34 5 6 0 intersection of lines
S-66 0 0 3
T-50 2 3 0 Step 3 - Subtraction
Typesetter
Because only two lines A B C
are needed to cover all Job
the zeros, the solution is R-34 3 4 0
not optimal S-66 0 0 5
T-50 0 1 0

29 MM ZG515/QMZG515 Quantitative Methods BITS Pilani WILPD

 Assignment Example

Step 2 - Lines Start by assigning R-34 to

worker C as this is the only
Typesetter possible assignment for
A B C worker C. Job T-50 must go
Job to worker A as worker C is
R-34 3 4 0 already assigned. This
S-66 0 0 5 leaves S-66 for worker B.
T-50 0 1 0 Step 4 - Assignments
Typesetter
Because three lines are A B C
needed, the solution is Job
optimal and assignments R-34 3 4 0
can be made S-66 0 0 5
T-50 0 1 0
30 MM ZG515/QMZG515 Quantitative Methods BITS Pilani WILPD
 Assignment Example
Step 4 - Assignments
Typesetter Typesetter
A B C A B C
Job Job
R-34 11 14 6 R-34 3 4 0
S-66 8 10 11 S-66 0 0 5
T-50 9 12 7 T-50 0 1 0

From the original cost table

Minimum cost = 6 + 10 + 9 = 25

31 MM ZG515/QMZG515 Quantitative Methods BITS Pilani WILPD

 Practice
Ola has four taxis waiting at four locations and the four customers have
tried to book four taxis. The distances between each customer and taxis
were as follows. Find the optimal assignment of taxis to customers to
minimize total driving distances to the customers.
Customer
Cab Site A B C D
Location1 7 3 4 8
Location2 5 4 6 5
Location3 6 7 9 6
Location4 8 6 7 4

32 MM ZG515/QMZG515 Quantitative Methods BITS Pilani WILPD