CHAPTER 4 – NETWORK MODELS

LEARNING OBJECTIVES
At the end of the lessons, students are expected to:
1. formulate network models;
2. analyze and solve shortest path problems;
3. analyze and solve traveling salesperson problems;
4. analyze and solve network problems using minimal spanning tree; and
5. analyze and solve maximum flow problems.

Network Models

A few issues can be described graphically as a network (the set of nodes and arcs). Typical
circumstance is a transportation network: cities (nodes) are connected with one another by roads
(arcs). If we assess the network (in this case we are interested e.g. in distances between all the
cities), the undertaking is often to locate the minimal distance from one city to all other cities.
Some types of networks may be evaluated by capacities rather than distances and afterward the
problem of maximal flow can be solved. In numerous issues, solved with utilization of the network
models, the most significant value is unit cost and the objective is to find the minimal total cost

Some administrative problems can be described graphically as a network. It is a set of nodes

and arcs that diagrams the relationships between objects of the real system. Network models can
represent e.g. a transportation system where nodes are the cities and arcs are the connections
between them (roads). The network expression is also appropriate for description of computer
systems (Local Area Network, World Wide Web, etc.), the company organization and production
process, piping systems, or projects. In the following section the basic terminology and notation
for network problems and some applications will be discussed.

The network model describes conformations of flow in a connected system in which the
flow can include material, people, funds, and so on. These configurations are appropriately
described with flow diagrams that support in the development of effective spreadsheet models.
The opportunity of undertaking some of the model building with a diagram makes network models
a special category of linear programs.

3.1 Network Terminology

As we mentioned earlier, the network is a set of nodes and arcs. The arc is a connector
between a pair of nodes and can be directed (oriented) or undirected. A directed arc specifies
which node is considered as the point of origin. The orientation of the arc is marked with the
arrowhead.

i i
Fig. 3.1 Undirected and Directed Arc

If a network contains directed arcs it is called a directed network. Otherwise it is called

an undirected network.
The network is a specific sequence of arcs in which the initial node of each arc is identical
with the terminal node of the preceding arc in the sequence is a path. This sequence must cross
the different nodes. In Figure 3.2 the example of such a path is shown (the sequence across the
nodes 1 – 2 – 4 – 5 – 6).
 Fig. 3.2 Path Between Nodes 1 and 6

The path in Figure 3.2 is an open path, since it starts and ends in different nodes. If the
path starts and ends in the same node (closed path) it is termed a circuit (cycle).

Fig. 3.3 Circuit

If there is a path connecting every pair of nodes in the network, it is called connected.
The network shown above is connected. If we removed the arcs (1, 2) and (1, 3), there would
no longer have the connected network.
The connected network without any circuit is called a tree. If we denote the total number
of nodes in the network as n it is evident that the tree involving all nodes must contain exactly
(n – 1) arcs. If we add any arc to the tree, the circuit will appear.

A spanning tree is a tree including all the nodes from the original network. The tree
shown in Figure 3.4 is an example of spanning tree. Removing of any arc from the spanning
tree changes the tree into unconnected network.

Fig. 3.4 Spanning Tree

In real situation the network is evaluated. The values can be added to nodes or/and to arcs
and can represent time, distance, cost, capacity, etc. In the following section, several examples
of network problems are described.
3.2 Basic Network Applications
Before describing the frequent applications of network theory - project management we
mention some simple circumstances where the network representation is effectively utilized.
However, it is not possible to describe all the methods used for solving problems and we will
concentrate just on some simpler methods.

3.2.1 Shortest Path Problem

The problems in this category concern situations where we have to locate the shortest
path from an origin to a destination. Typically, there is no direct connection between these two
points and the path crossing numerous other points must be found. A network represents the
possible connections (arcs) between all points (nodes). Distance between the pair of connected
nodes is attributed to each arc.
The shortest-path problem is a specific network model that has gotten a lot of consideration
for both practical and theoretical reasons. The essence of the problem can be specified as follows:
Given a network with distance ci j (or travel time, or cost, etc.) related with each arc, discover a
path through the network from a particular origin (source) to a particular destination (sink) that
has the shortest total distance. The simplicity of the statement of the problem is somewhat
confusing, since a number of significant applications can be formulated as shortest- (or longest-)
path problems where this formulation is not obvious at the outset. These include problems of
equipment replacement, capital investment, project scheduling, and inventory planning. The
theoretical interest in the problem is due to the fact that it has a special structure. Moreover to
being a network, that results in very efficient solution procedures. Further, the shortest-path
problem often occurs as a subproblem in more complex situations, such as the subproblems in
applying decomposition to traffic-assignment problems or the group-theory problems that arise in
integer programming

Example 3.1
In Figure 3.5 there is an example with 6 cities. Direct distances between the cities are in
kilometers. The goal is to run from the city 1 to the city 6 through shortest path. It is easy to locate
the path across the cities 2 and 3. The length of the shortest path is 40 km.

Fig. 3.5 Shortest Path Between Nodes 1 and 6

The issue can be conveyed as finding the shortest paths not only from one origin to one
destination, but from each node to all the other nodes (Table 3.1). Because the network is
undirected the matrix of shortest paths is symmetric (e.g. the length of the path from 1 to 6
equals the length of the path from 6 to 1).
 To 1 2 3 4 5 6
From

1 0 14 24 26 32 40

2 14 0 10 12 18 26

3 24 10 0 15 28 16

4 26 12 15 0 23 15

5 32 18 28 23 0 30

6 40 26 16 15 30 0

Tab. 3.1 Shortest Paths Between All Pairs of Nodes

3.2.2 Traveling Salesperson Problem (TSP).

The travelling salesman problem asks the question: "With a list of cities and the distances
between each pair of cities, what is the shortest possible route that visits each city and returns to
the origin city?" It is a problem in combinatorial optimization, important in theoretical computer
science and operations research.

Example 3.2
A salesperson has to visit a specified group of cities and come back to the origin (home
city). This tour should be as short as possible in terms of the total distance. In Figure 3.6 such a
tour (circuit) is displayed (it crosses the nodes 1, 2, 5, 4, 6, 3, 1). The optimal total distance is
111km.

Fig. 3.6 Traveling Salesperson Problem

If we tabulate the direct distances between nodes, we can illustrate the similarity to the
assignment problem, in which the objective is to mark 6 cells respecting the following rule:
exactly one cell in each row and in each column is marked. Table 3.2 shows the optimal solution
of TSP (dashes are used for unidentified connections).

To 1 2 3 4 5 6
From
1 - 14 25 - - -
2 14 - 10 12 18 -
3 25 10 - 15 - 16
4 - 12 15 - 23 15
5 - 18 - 23 - 30
 6 - - 16 15 30 -

Tab. 3.2 Traveling Salesperson Problem

If the undertaking had been answered as the classical assignment problem numerous
solutions would have been found, infeasible in case of traveling salesperson problem. One of
those solutions is strongly shaded in Table 3.3. When we graph this solution (Figure 3.7), we
can see two sub-tours 1-2-3-1 and 4-5-6-4. Whereas it is feasible solution of assignment
problem, it is infeasible in traveling salesperson problem. Hence in formulation of the model, it
is indispensable to add constraints that prevent building sub-tours.

To 1 2 3 4 5 6

From

1 - 14 25 - - -

2 14 - 10 12 18 -

3 25 10 - 15 - 16

4 - 12 15 - 23 15

5 - 18 - 23 - 30

6 - - 16 15 30 -

Tab. 3.3 Assignment Problem

Fig. 3.7 Infeasible Sub-Tours in TSP

3.2.3 Minimal Spanning Tree

In some circumstances, instead of finding the shortest path or the shortest tour, the
objective is to guarantee a connection between all nodes in the network. Assuming n nodes in the
network, a spanning tree is such sub-network that comprises exactly (n-1) arcs and no circuits. If
we have the evaluated network (e.g. by distances), the minimal spanning tree is a spanning tree
with the minimal sum of values.
A minimum spanning tree is a subset of the edges of a connected, edge-weighted
undirected graph that links all the vertices together, without any cycles and with the minimum
possible total edge weight. It is a spanning tree whose sum of edge weights is as small as possible.
Example 3.3
We illustrate one of the possible algorithms on this elementary example. Assume that the
managerial problem is to connect 9 locations of an exhibition area with the source of electricity
power. The goal is to minimize the cost of all the extensions. The direct distances (in meters)
between locations can be found in Figure 3.8. The node 1 is the source of power. The price per 1
meter of a cable is 10 CZK.

Fig. 3.8 Electricity Power Distribution in the Exhibition Area

Solution
1. In the first step we find two arcs with minimal distances. These are the arcs (8, 10) and
(3, 5) with direct distances 35 and 40 meters (Figure 3.9).

Fig. 3.9 First Step – Finding Two Arcs with Minimal Lengths
2. In the second step we need to find for another arc (from the set of all the
remaining arcs in the network) with the minimal distance. This arc is added into the set of
the arcs selected before. We must note the relevant rule that no circuit can happen after
adding a new arc. If the circuit appeared we would ignore this arc in the searching process
 Fig. 3.10 Second Step – Adding a New Arc

3. We repeat the second step until a minimal spanning tree is found.

Figure 3.11 illustrates the optimal solution (minimal spanning tree). The total length of
the cable necessary for all the extensions is 490 meters. Thus, total cost of distribution of
electricity power in the exhibition area is 4900 CZK.

Fig. 3.11 Optimal Solution – Minimal Spanning Tree

3.2.4 Maximum Flow Problem

In some network design applications the concern is to send as much flow as possible
through the network, rather than to send flow at lowest cost. This alternative is readily handled
by dropping the balance constraints at the origins and destinations of flow, while substituting
an objective that stands for total flow in some sense.

To find a maximal quantity of gas, fluid, traffic, information, people and so on that can
be transported through a capacitated network is the objective. This network comprises two
relevant nodes – a starting node called the source and a terminal node called the sink. However
in directed networks the movement must note the orientation of the arcs (movement in the
reverse direction is restricted), in undirected networks movement in both directions is allowed.
The maximum flow problems include finding a feasible flow through a flow network that
acquires the maximum possible flow rate. The maximum flow problem can be seen as a special
case of more complex network flow problems, such as the circulation problem.
There are five relevant rules that must be considered during the construction of the
mathematical model:
 1. The quantity flowing through an arc must be less than or equal to the capacity of that
arc.
2. For every node, except the source and the sink, the quantity flowing out of a node is
equal to the quantity flowing into it.
3. Total quantity flowing into the source is zero.
4. Total quantity flowing out of the sink is zero.
5. Total quantities flowing out of the source and into the sink are equal.

Example 3.4
The board of White Lake City, which is located on the edge of a small lake, solves the
problem of minimizing disruptive effects of possible flood. One of solutions is to rebuild the
system of drains that would pump the water out of the lake into great reservoir. Since there are
two alternatives of a drain system, the city board must decide which of them will be used.

Fig. 3.12 Drain System — “Northern Channel”

Fig. 3.13 Drain System— “Southern Channel”

The objective is to maximize the quantity of water being pumped in one hour. In
both networks (Figures 3.12 and 3.13) the capacities of all the drains (in cubic meters per
hour) are known.

Optimal Solution
If the city used the first alternative “Northern Channel”, it would allow to pump
maximally 1930 cubic meters per hour. Figure 3.14 displays for each drain the quantity
of water and the direction in which the water will be flowing. Capacity of some drains is
not saturated (e.g. (1, 2) or (6, 7)); some drains are not used at all ((2, 3), (3, 4) and (7,
8)).

Note: A maximum flow problem has usually multiple optimal solutions. Using
other algorithms could lead to another solution with the maximal flow 1930 cubic meters
per hour, however with a different structure of individual flows.

In Figure 3.15 you can find the optimal solution for the second alternative
“Southern Channel”. Since the maximum flow equals 2270 cubic meters per hour, the
city board should prefer this alternative to protect the White Lake City from the possible
flood.

ACTIVITIES

1. Ships are available at three ports of origin and need to be sent to four ports of destination.
The number of ships available at each origin, the number required at each destination, and
the sailing times are given in the tableau below.

Our objective is to minimize the total number of sailing days.

a) Find an initial basic feasible solution.
 b) Show that your initial basis is a spanning tree.
c) Find an initial basic feasible solution using the other two methods presented in the text.
Solve completely, starting from the three initial solutions found in parts (a) and (c).
Compare how close these solutions were to the optimal one.
d) Which of the dual variables may be chosen arbitrarily, and why?
e) Give an economic interpretation of the optimal simplex multipliers associated with the
origins and destinations.

2. A distributing company has two major customers and three supply sources. The
corresponding unit from each supply center to each customer is given in the following
table, together with the total customer requirements and supply availabilities.

Customer Available Supply center 1 2 supplies 1 −1 3 300 2 1 6 400 3 1 5 900 Customer

requirements 800 500 Note that Customer 1 has strong preferences for Supplier 1 AND
will be willing not only to absorb all the transportation costs but also to pay a premium
price of $1 per unit of product coming from Supplier 1.
a) The top management of the distributing company feels it is obvious that Supply Center
1 should send all its available products to Customer 1. Is this necessarily so? (Hint.
Obtain the least-cost solution to the problem. Explore whether alternative optimal
solutions exist where not all the 300 units available in Supply Center 1 are assigned to
Customer 1.)
b) Assume Customer 2 is located in an area where all shipments will be subject to taxes
defined as a percentage of the unit cost of a product. Will this tax affect the optimal
solution of part (a)?
c) Ignore part (b). What will be the optimal solution to the original problem if Supply
Center 1 increases its product availability from 300 units to 400 units?

3. Consider the following transshipment problem where goods are shipped from two plants
to either a warehouse or two distribution centers and then on to the two end markets.

The production rates in units per month are 250 and 450 for plants 1 and 2, respectively.
The demands of the two markets occur at rates 200 and 500 units per month. The costs of
shipping one unit over a particular route is shown adjacent to the appropriate arc in the
network.
a) Redraw the above transshipment network as a network consisting of only origins
and destinations, by replacing all intermediate nodes by two nodes, an origin and
destination, connected by an arc, from the destination back to the origin, whose
cost is zero.
b) The network in (a) is a transportation problem except that a backwards arc, with
flow xii, from newly created destination i to its corresponding newly created
source, is required. Convert this to a transportation network by substituting x 0 ii =
B − xii. How do you choose a value for the constant B?
c) Certain arcs are inadmissible in the original transshipment formulation; how can
these be handled in the reformulated transportation problem?
d) Interpret the linear-programming tableau of the original transshipment network and
that of the reformulated transportation network.
e) Can any transshipment problem be transformed into an equivalent transportation
problem?
References
Baker, K. (2011). Linear Programming: Network Models. Retrieved from
https://onlinelibrary.wiley.com/doi/10.1002/9780470949108.ch3#:~:text=The%20networ
k%20model%20describes%20configurations,%2C%20funds%2C%20and%20so%20on.
&text=The%20possibility%20of%20doing%20some,special%20category%20of%20linea
r%20programs.
Fabry, J. (2003). Management Science. University of Economics Prague.
Fourer, R. (2003). Network Linear Programs. Retrieved from
https://ampl.com/BOOK/CHAPTERS/18-network.pdf
Network Models. Retrieved from http://web.mit.edu/15.053/www/AMP-Chapter-08.pdf