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Op Question3,2 (C) (Vogel Approximation Method)

Vogel's approximation method is a heuristic procedure used to solve transport problems, such as determining the most cost-effective routes for distributing goods from multiple production sites to various locations. It works by creating a matrix to track supply and demand quantities and costs, then iteratively assigning supply to demand in the most cost-effective way until all quantities are allocated. While the solution is not truly optimal, it comes close with less computational effort than other methods. The transport problem involves minimizing costs for distributing uniform goods from suppliers to consumers given supply, demand, and cost data.

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shubham mourya
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142 views2 pages

Op Question3,2 (C) (Vogel Approximation Method)

Vogel's approximation method is a heuristic procedure used to solve transport problems, such as determining the most cost-effective routes for distributing goods from multiple production sites to various locations. It works by creating a matrix to track supply and demand quantities and costs, then iteratively assigning supply to demand in the most cost-effective way until all quantities are allocated. While the solution is not truly optimal, it comes close with less computational effort than other methods. The transport problem involves minimizing costs for distributing uniform goods from suppliers to consumers given supply, demand, and cost data.

Uploaded by

shubham mourya
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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{Vogel’s approximation method}

The approximation method according to Vogel is a


heuristic procedure that is mainly used in
distribution logistics, for example to solve a
transport problem. It belongs to the field of
mathematically oriented statistics, also called
operations research. The method comes very close to
the desired optimum, but the effort required is much
higher compared to other mathematical methods.

The central problem in distribution logistics is to


transport a good from A to B as cheaply as possible.
This is not only a matter of pure route planning but
also of criteria relating to the establishment of
distribution centres and production sites in terms of
operational planning. If, for example, a company
manufactures a certain product in several plants that
is delivered to different locations, then Vogel’s
approximation method can be used to find out which
transport routes would be almost optimal under which
conditions.

{Vogel’s approximation method in practice}

When solving a transport problem, Vogel’s


approximation method acts as a basic solution, which
then finds a cost-optimised approximate solution with
further optimisation methods. The transport problem
is, as mentioned above, a question from Operations
Research. It is concerned with finding a cost-
minimised (optimal) route that specifies the transport
of uniform objects from several supply locations to
several demand locations. The quantities available and
to be delivered at the respective locations are given.
The corresponding transport costs per unit between all
locations are also known. Other heuristic methods that
deal with the solution of the transport problem in
Operations Research are the north-west corner method
and the matrix minimum method.

{Vogel’s approximation method: the algorithm step by


step}

The fixed data are the supply and demand locations and
their corresponding capacities and requirements. The
units to be supplied are entered (see also the
videos).

1. Initially, an auxiliary matrix is created with the


opportunity costs. These result from the difference
between the two smallest values of the respective row
and column.

2. The row or column with the highest opportunity


costs is then selected.
3. Then the lowest value in that row or column is
selected. In the original matrix, the maximum possible
capacities are now assigned to this field.

4. In the original matrix, the relevant column or row


is filled in with zeros and deleted from the auxiliary
matrix as soon as the supply or demand quantity is
exhausted.

5. The opportunity costs are recalculated after each


round, and the allocation process starts all over
again

6. When all capacities are allocated, the procedure is


completed.

In principle, the idea behind this is that first the


path is taken, which would cause the greatest costs in
the event of abandonment. These are represented by the
opportunity costs in the auxiliary matrix. Instead of
working with the absolute price, the relative price
increase is considered here.

{Advantages and disadvantages}

{Advantages}

The solution is close to the optimum


The computing time is low because there are no complex
matrix operations.
Valid integer solutions are quickly found.
Quickly done by hand – if the complexity allows it.

{Disadvantages}

The solution is not the optimum.


The algorithm can hardly include fixed costs and
multiple product cases.
Nowadays, additional computing power is required for
complex problems.

{Summary}

The transport problem is a basic logistical problem


that can be solved by Vogel’s approximation method.
This is a heuristic procedure that forms the basis for
an approximate solution that comes very close to the
optimum. The resulting transport mix keeps transport
costs to a minimum. Since logistical requirements are
constantly changing, this calculation must also be
performed continuously to ensure permanent cost
optimisation.

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