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Assignment and Transportation Model (Linear Programming Minimization Approach) - Operations Management

This document discusses using linear programming to solve a transportation problem for a canned goods company with 3 plant facilities shipping to 3 destinations. The problem involves minimizing transportation costs given production capacities at each branch and demand requirements at each destination. The optimal solution allocates 500 units from Branch 1 to Location C, 400 units from Branch 2 to Location B, and 200 units from Branch 3 to Location A, incurring a total minimum cost of Php 220,000.

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Rovic Ira Correos
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67 views

Assignment and Transportation Model (Linear Programming Minimization Approach) - Operations Management

This document discusses using linear programming to solve a transportation problem for a canned goods company with 3 plant facilities shipping to 3 destinations. The problem involves minimizing transportation costs given production capacities at each branch and demand requirements at each destination. The optimal solution allocates 500 units from Branch 1 to Location C, 400 units from Branch 2 to Location B, and 200 units from Branch 3 to Location A, incurring a total minimum cost of Php 220,000.

Uploaded by

Rovic Ira Correos
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
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Rovic Ira A.

Correos Mgt187 F – Operations Management


BS in Management III
Activity 6
The Transportation Model
In solving the assignment and transportation problems, linear programming (LP) is
used to determine the minimum cost possible given the specific combinations of
destinations.

Illustrative Scenario
An operations manager in a canned goods company has three (3) plant facilities
across international borders. The firm has currently engaged in three (3) major trucking
deliveries and is planning to produce a budget proposal that best minimizes transportation
costs to each of the three destinations where the canned good production takes place. Each
transportation cost is reflected on the estimated gasoline each truck has been tasked to
deliver each order to their respective destinations.
Details about the estimated shipping costs to these destinations are shown on the
table below:

Table 1. Details on the company’s shipping costs and demand requirements per project.

Solution Scheme
I. Constraints
The optimal combinations and the constraint equations for the transportation
problem are listed below:
Project A demand requirements X11 + X21 + X31 = 800 units
Project B demand requirements X21 + X22 + X32 = 750 units
Project C demand requirements X31 + X32 + X33 = 800 units
Branch 1 production capacity X11 + X12 + X13 ≤ 1,000 units
Branch 2 production capacity X21 + X22 + X23 ≤ 1,500 units
Branch 3 production capacity X31 + X32 + X33 ≤ 1,200 units
Provided that, all variables ≥ 0
The subscripts in the equation reflect varying combinations of branch-location
deliveries as represented by their respective ordered pairs of rows and columns.

II. Determining the most optimal combination

Table 2. Optimal combination of canned goods to minimize costs.


Using linear programming (LP) approach in QM Solver, it is determined that the
cost-minimizing option of a company should be:
Branch 1 to Location C all 500 units demanded
Branch 2 to Location B all 400 units demanded
Branch 3 to Location A all 200 units demanded
Total cost to be incurred Php 220,000
In this scheme, the minimum transportation cost a company would incur will be Php
220,000 only.

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