 An integer linear optimization model (integer

program) has some or all variables restricted to being

whole numbers.
 A mixed-integer linear optimization model has only a
subset of variables restricted to being integer while
others are continuous.
 A special type of integer problem is one in which
variables can be only 0 or 1; these are used to model
logical yes-or-no decisions.
 Decision variables that we force to be integers are called
general integer variables.
 Algorithms for integer optimization models first solve the
LP relaxation (no integer restrictions imposed) and
gradually enforce integer restrictions using systematic
searches.
 Solver has a default integer tolerance of 0.05 so it will
stop if it finds an integer solution within 5% of the optimal
solution.
◦ To find the guaranteed optimal integer solution, Integer Tolerance must
be set to 0. Click the Options button in the Solver Parameters dialog and
ensure that the value of Integer Optimality (%) is 0.
 The optimal solution
was to produce 5.25
pairs of Jordanelle skis
and pairs of 10.5
Deercrest skis.
 Feasible integer
solutions are shown on
the accompanying
graph.
 To enforce integer restrictions on variables using Solver, click on
Integers under the Constraints list and then click the Add button. In
the Add Constraint dialog, enter the variable range in the Cell
Reference field and choose int from the drop-down box.

The maximum value of the objective function for

the model with integer restrictions is smaller than
the linear optimization solution. Whenever you add
a constraint to a model, the value of the objective
function can never improve and usually worsens.
 Graphical
illustration of
optimal integer
solution
 Note that
rounding the
original solution
is not optimal.
 Because integer models are discontinuous by their very
nature, sensitivity information cannot be generated in the
same manner as for linear models; therefore, no
Sensitivity report is provided by Solver— only the
Answer report is available.
 To investigate changes in model parameters, it is
necessary to re-solve the model.
 A company makes 110-inch wide rolls of thin sheet metal and slices
them in smaller rolls of 12, 15, and 30 inches.
 A cutting pattern is a configuration of the number of smaller rolls of
each type that are cut from the raw stock. Six different cutting
patterns are used.

 Demands for the coming week are 500 12-inch rolls, 715 15-inch
rolls, and 630 30-inch rolls.
 The problem is to develop a model that will determine how many
110-inch rolls to cut into each of the six patterns to meet demand
and minimize scrap.
 Model development
◦ Xi = number of 110-inch
rolls to cut using pattern i
 Xi needs to be a whole
number (general integer
variable) because each
roll that is cut generates a
different number of end
items.
◦ The only constraints are
end-item demand,
nonnegativity, and
integer restrictions.
 Workforce scheduling is a practical, yet highly complex,
problem in many businesses such as food service,
hospitals, and airlines.
 Typically a huge number of possible schedules exist and
customer demand varies by day of week and time of
day, further complicating the problem of assigning
workers to time slots.
 Brewer Services schedules customer
service workers on Monday to Friday, 8
a.m. to 5 p.m.
 Staffing requirements are shown in the
table.
 5 permanent employees work all day.
 Part-time employees work 4-hour shifts.
 What is the minimum number of part-time
employees needed to meet staffing
requirements?
 Model development
◦ Xi = integer number of part-time workers that start on the ith 4-hour shift
(i = 1 for 8 a.m., …, i = 6 for 1 p.m.)
◦ Constraints: For each hour, we need to ensure that the total number of
part-time employees who work that hour is at least as large as the
minimum requirements.

Net staff
requirements
for each hour
 The solution has 9 excess employees at
8 a.m., which may not be desirable.
 Most scheduling problems have multiple
optimal solutions.
 An easy way to find an alternative
optimal solution is to add an additional
constraint with the objective function
equal to the optimal solution value:

and then set the new objective function

to minimize the number of excess
employees at 8 a.m.
 Modified Solver model and Alternative Optimal Solution

However, now we have 9 excess employees at

noon.
 A better approach would be to
define additional constraints to
restrict the excess number of
employees in the range E21:E29
to be less than or equal to some
maximum number k and then
attempt to minimize the original
objective function.
◦ The smallest value of k that results in a
feasible solution is k = 3.
 A binary variable x is a general integer variable that is
restricted to being between 0 and 1:

◦ We usually just write this as x = 0 or 1.

 Binary variables are used to model logical decisions.
 Project selection model.
 Five potential projects are being considered. Each
project is expected to generate a return (given by the net
present value) but requires a fixed amount of cash and
personnel.

 The available budget and human resources do not allow

selection of all 5 projects.
 The objective is to maximize expected return.
 Model development
 Define Xi as binary: Xi = 1 if project i is selected; Xi = 0 if project i
not selected
 Maximize $180,000X1 + $220,000X2 + $150,000X3 + $140,000X4
+ $200,000X5
 Cash limitation: $55,000X1 + $83,000X2 + $24,000X3 + $49,000X4
+ $61,000X5 ≤ $150,000
 Personnel limitation: 5X1 + 3X2 + 2X3 + 5X4 + 3X5 ≤ 12

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publishing as Prentice Hall 15-21
 Spreadsheet implementation and Solver model
 Sensitivity analysis for integer optimization requires re-
solving the model for changes in the data.
 The heat map below shows the impact of various levels
of available resources (cash and personnel) on the
expected return.
◦ The upper-left-hand corner of each colored region (shown boxed
in the figure)represents the lowest amount of resources required
to achieve that return.
 Examples
◦ If project 1 is selected, then project 4 must also be selected
◦ Excel IF functions, while logical, cannot be used in linear
optimization
◦ Model this as X4 ≥ X1
◦ If X1 = 1, then X4 is forced to be 1.
 Other types of logical constraints:
Suppose project managers want to ensure that:
 If project 1 is selected, then project 4 is also selected: X4 − X1 ≥ 0

 At most one of projects 1 and 3 can be selected: X1 + X3 ≤ 1

 Define a cell for each constraint function (cells B17 and B18)
 Location model: find a subset of locations that cover a service area.
 Anderson Fire Department serves 7 districts.
 The village wants to determine where to locate fire stations so that
response times to residents in all 7 districts is no more than 8
minutes.
 Response times:
 Model development
 Define Xj as binary
Xj = 1 if a fire station is located in district j
Xj = 0 if a fire station is not located in district j
 Minimize the number of fire stations:
 Each district must be reachable within 8 minutes by some fire
station:
 Spreadsheet implementation and Solver model
◦ Construct a matrix by converting all response times that are within 8 minutes to 1s
and those that exceed 8 minutes to 0s. Then the constraint functions for each
district are simply the SUMPRODUCT of the decision variables and the rows of
this matrix
 The village’s board of trustees wants to better
understand the trade-offs between response time and
required number of fire stations.
◦ Vary response times from 5 to 10 minutes to see the effect on the
number of fire stations required.
◦ Analytic Solver Parametric Analysis
A response time
of 5 minutes
requires 3 fire
stations.
A response time
of 9-10 minutes
requires 1 fire
station.
 A company has numerous potential locations for
distribution centers to ship products to customers.
 A single-sourcing policy specifies that each customer
can only be supplied from one distribution center.
 The problem is to determine which customers to assign
to each distribution center.
 Define Xij = 1 if customer j
is assigned to distribution
center i; Xij = 0 if not
 Yi = 1 if distribution center
i is selected as a location;
Yi = 0 if not
 Cij = total cost of
satisfying the demand of
customer j from
distribution center i
 k = number of distribution
centers to be selected
 Distributes restaurant supplies in 5 major cities.
 Four possible locations for distribution centers
have been identified.
 P&G Foods wants to determine the supply chain
configuration that minimizes sourcing costs.
 Model development
◦ Xij = 1 if city j is
assigned to distribution
center i
◦ Yi = 1 if distribution
center i is selected as a
location
◦ k = number of
distribution centers to
be selected
 Spreadsheet and Solver model
 Many practical applications of optimization involve a combination of
continuous variables and binary variables.
 A common example is a plant location and distribution model in
which a company must decide which plant to build (binary variables)
and then how to best ship the product from the plant to the
distribution centers (continuous variables).
◦ E.g.: With increased demand that exceeds capacity at Marietta and
Minneapolis, GAC is considering adding a new plant in either Fayetteville
or Chico
 Define a binary variable for the decision of which plant to
build: Y1 = 1 if the Fayetteville plant is built and Y2 = 1 if
the Chico plant is built.
 Define normal variables Xij, representing the amount
shipped from plant i to distribution center j.
 Objective function:
 Capacity constraints
◦ Capacity constraints for the Marietta and Minneapolis plants
remain as before. However, for Fayetteville and Chico, we can
allow shipping from those locations only if a plant is built there.

◦ Note that if the binary variable is zero, then the right-hand side of
the constraint is zero, forcing all shipment variables to be zero
also. If, however, a particular Y-variable is 1, then shipping up to
the plant capacity is allowed.
 Demand constraints

 Build exactly one plant

 Nonnegativity for Xij

 In the plant location model, why not use IF functions
instead of these constraints?

 From a spreadsheet perspective, there is nothing wrong

with this.
◦ However, from a linear optimization perspective, the use of an IF
function no longer preserves the linearity of the model
(technically, the model would be called nonsmooth) and we would
get an error message in trying to solve the model.
◦ Similarly, using the constraint X31Y1 + X32Y1 + X33Y1 + X34Y1 ≤
1500 is logically correct, but multiplying the two variables together
results in a nonlinear function.
 Many business problems involve fixed costs; they are
either incurred in full or not at all.
 Binary variables can be used to model such problems in
a similar fashion as we did for the plant location model.
 K&L Designs model was developed in Chapter 14:

 Suppose that the company must rent some equipment, which costs
$65 for 3 months. The equipment can be rented or returned each
quarter, so if nothing is produced in a quarter, it makes no sense to
incur the rental cost.
 Model development
◦ Define binary variables for each season:
Yi = 1 if production occurs during season i
Yi = 0 if not
 Objective function
 Material balance constraints

 We must ensure that whenever a production variable, P, is positive,

the corresponding Y variable is equal to 1; conversely, if the Y
variable is 0 (you don’t rent the equipment), then the corresponding
production variable must also be 0.

 Production variables are nonnegative, and Y variables are binary

 This model does not preclude feasible solutions in
which a production variable is 0 while its
corresponding Y-variable is 1. E.g., PA could be
zero even if YA = 1,
◦ This implies that we incur the fixed cost even though
no production is incurred during that time period.
 Although such a solution is feasible, it can never be
optimal, because a lower cost could be obtained by
setting the Y-variable to 0 without affecting the
value of the production variable, and the solution
algorithm will always ensure this.
 Therefore, it is not necessary to explicitly try to
incorporate this in the model.