Goal Programming

5.1 Introduction

We have studied that linear programming models are formulated and solved to optimize a single measure of
effectiveness: profit, cost, etc. under the set of certain structural constraints. Although a single objective is easy to
incorporate into a mathematical model and to solve, a single objective is not often representative of the reality due to
divergent and conflicting interests and objectives (economic as well as non-economic) of any business or service
organization. Consequently there arises a need to attain a satisfactory' level of achievement among multiple and
conflicting interests and objectives (or goals).

The technique of deriving a best possible 'satisfactory’ level of goal attainment is goal programming (GP). A
problem is modelled into a GP model in a similar manner as that of the LP model. However, the GP model
accommodates multiple and often conflicting incomparable goals in a particular priority order (hierarchy). A
particular priority structure is established by ranking and weighing various goals and their sub goals in accordance
with their importance. The priority structure helps to deal with all goals (objectives) which cannot be completely
and/or simultaneously achieved, in such a manner that more important goals are achieved first at the expense of less
important goals.

5.2 Concept/ Philosophy of Goal Programming/ Multi Criteria Decision Problem

The goal-based philosophy has been formalized in the modern field of operational research and management science
by the technique of goal programming. The concept of GP was first introduced by Channes and Cooper (1961) in
the context of executive compensation. They suggested a method for solving infeasible LP problems arising from
various conflicting resource constraints (goals). A few examples of multiple conflicting goals are: (1) maximize
profits and increase wages paid to employees, (i) upgrade product quality and reduce product cost, (ii) reduce credit
losses and increase sales. ljiri (1965) developed the concept of pre-emptive priority factors, assigning different
priority levels to incommensurable goals and different weights for the goals at the same priority level. Lee (1972)
and Ignizio (1976) have written entire textbooks on the subject of goal programming. Goal programming has been
applied to a wide range of planning, resource allocation, policy analysis and functional management problems.

The distinguishing feature of GP is that the goals are satisfied in ordinal sequence. That is, the solution of the GP
problem involves achieving some higher goals first, before the lower order goals are considered .Since it is not
possible to achieve every goal to the extent desired by the decision-maker, attempts are made to achieve a
'satisfactory level of all his/her goals rather than optimum solution for a single goal.

In GP, instead of trying to minimize or maximize the objective function directly as in LP, the deviations from
established goals within the given set or constraints are minimized. In the simplex algorithm of linear programming
such deviational variables take on a new significance in goal programming. The deviational variables are
represented in two dimensions, both positive and negative deviations from each goal and sub goal. The objective
function then becomes the minimization of a sum of these deviations based on the relative importance within the
pre-emptive priority structure assigned to each deviation.

Goal programming is a branch of multi-objective optimization, which in turn is a branch of multi-criteria decision
analysis (MCDA). It can be thought of as an extension or generalization of linear programming to handle multiple,
normally conflicting objective measures. Each of these measures is given a goal or target value to be achieved.
Deviations are measured from these goals both above and below the target. Unwanted deviations from this set of
target values are then minimized in an achievement function. This can be a vector or a weighted sum dependent on
the goal programming variant used. As satisfaction of the target is deemed to satisfy the decision maker(s), an
underlying satisficing philosophy is assumed. Goal programming is used to perform three types of analysis:
 (i) Determine the required resources to achieve a desired set of objectives.
(ii) Determine the degree of attainment of the goals with the available resources.
(iii) Providing the best satisfying solution under a varying amount of resources and priorities of the goals.
Goal programming is an approach used for solving a multi-objective optimization problem that balances a trade-off
in conflicting objectives. It is an approach of deriving a best possible 'satisfactory' level of goal attainment. Goal
programming which reflects the Simon's theory of “satisficing” is widely applied techniques for modeling modern
decision-making problems. The advantage of using goal programming over other techniques is with dealing with
real-world decision problems is that it reflects the way manages actually make decisions. Goal programming allows
decision maker to incorporate environmental, organizational, and managerial consideration into model through goal
levels and priorities.
5.3 Difference between LP and GP Approach

Linear Programming Goal Programming

One Objective function or goal Multiple Conflicting Goals with different priority.
Objective function or single goal to be optimized Deviational variables to be minimized.
(minimized or maximized)
Optimizing Satisficing
Minimization or Maximization Problem Always a Minimization Problem as it works on
minimizing deviational variables to its maximum.
Constraints are linearly related Linear relations between constraints are not a mandatory
requirement
Objective function is measured in one dimension and Multiple goals can be expressed in different units of
one unit of measurement of various resources which is measurement e.g. currency, hours, tons, meter etc. Also,
highly unusual situation in real life. deviational variables are represented in two dimensions
within objective function (positive and negative
deviation from goal)
Slack (less than or equal constraints) and Surplus Deviational variables (d−, d+) used which means
(greater than or equal constraints) variables utilized. underachievement and overachievement respectively.
No preemption as only single objective function along Involves concept of preemptive priority factors,
with constraints are considered. LP allows the cardinal assigning different priority levels to incommensurable
solution value. goals and different weights to the goals at the same
priority level. Hence allows for ordinal (ranking)
solution
Only one goal /objective function hence no need of Establishment of hierarchy of importance amongst goals
hierarchy. so that low order goals are considered only after high
order goals are satisfied or have reached the point
beyond which no further improvement is desired.
Constraints are limited to only three possible relational For constraints, equality (, =, =) and inequalities (<, >)
operators: =, ≥, ≤. Strictly inequalities (<, >) are not both are allowed.
allowed.

5.4 Terminology

The basic terms used in Goal Programming are as follows:

Decision Maker(s): The decision maker(s) refer(s) to the person(s), organization(s), or stakeholder(s) to whom the
decision problem under consideration belongs.
Decision Variable: A decision variable is defined as a factor over which the decision maker has control. The set of
decision variables fully describe the problem and form the decision to be made.
Criterion: A criterion is a single measure by which the goodness of any solution to a decision problem can be
measured. There are many possible criteria arising from different fields of application but some of the most
commonly arising relate at the highest level to
• Cost
• Profit
• Time
• Distance
• Performance of a system
• Company or organizational strategy
• Personal preferences of the decision maker(s)
• Safety considerations
A decision problem which has more than one criterion is therefore referred to as a multi-criteria decision making
(MCDM) or multi-criteria decision aid (MCDA) problem. The space formed by the set of criteria is known as
criteria space.
Objective: An objective will be referred to as a criterion with the additional information of the direction (maximize
or minimize) in which the decision maker(s) prefer on the criterion scale, for example minimize cost or maximize
the performance of a system. A decision problem with a set of objectives to be maximized or minimized is referred
to as a multi-objective optimization problem. In practice, these objectives will be conflicting, that is they cannot
reach their optimal values simultaneously. If they could, then the model can be solved as a single-objective problem
for any of the objectives. The space formed by the values of the set of objectives is known as objective space.
Goal: A goal refers to a criterion and a numerical level, known as a target level, which the decision maker(s) desire
to achieve on that criterion. There are three principal types of goals that can occur in a goal programming model, as
listed in Table below.
Three principal types of goals
Goal type Significance Example
1 Achieve at most the target level Keep costs within a budget of $1 m
2 Achieve at least the target level Aim to produce at least 20 items
3 Achieve the target level exactly Aim to employ exactly 20 workers

Deviational Variable: A deviational variable measures the difference between the target level on a criterion and the
value that is able to be achieved in a given solution. If the achieved value is above the target level then the difference
is given by the value of the positive deviational variable. The positive deviational variable is denoted by d +. If the
achieved value is below the target level then the difference is given by the value of the negative deviational
variable. The negative deviational variable is denoted by d−. The deviational variables in GP model are equivalent
to slack and surplus variables in LP model. The devotional variables d+ (called surplus variable in LP) is removed
from the objective function of GP when overachievement is acceptable. Similarly, if underachievement is
acceptable, d− (called slack variable in LP) is removed from the objective function of GP. But, if exact attainment of
the goal is desired, then both d− and d+ are included in the objective function and ranked according to their pre-
emptive priority factor, from the most important to the least important.
The essence of goal programming is the minimization of unwanted deviational variables. For goal type 1 or ‘less is
better’, the positive deviational variable is said to be the unwanted deviational variable For goal type 2 or ‘more is
better’, the negative deviational variable is said to be the unwanted deviational variable. For goal type 3, both
positive and negative deviational variables are said to be unwanted deviational variables.
Aspiration level: The numerical value specified by the decision maker that reflects his/her desire or satisfactory
level with regard to the objective function under consideration is known as aspiration level.
For example, suppose the company wishes to maximize the profit which is formulated as:
Maximize Z = x1 + 5x2 (1)
Further suppose the management wishes to have at least profit Rs.40000 as profit, the above stated objective is
required to be rewritten as
Maximize Z = x1 + 5x2≥ 40000 (2)
Here, 40000 is the aspiration level with respect to profit.
Goal: An objective function along with its aspiration level is called a goal.
For example, the relation (1) is the objective function whereas the relation (2) is a goal.
Goal Deviation: The difference between what we actually receive and what we desire to achieve is called goal
deviation. There are two types of goal deviations namely (1) positive deviation or overachievement (d +) and (2)
negative deviation or underachievement (d−).
In general goals can be defined in the following three ways:
Positive deviation: f(x) ≤ b  f(x) + d− = b
Negative deviation: f(x) ≥ b  f(x) - d+ = b
Both deviations: f(x) ≤ b  f(x) + d−- d+ = b
If exact attainment of the goal is desired (i.e., when constraint is = sign), then both d−and d+ are
included in the objective function and ranked. The variable d is removed from objective function of goal
+

programming which over achievement is acceptable and the variable d−is removed from objective
function of goal programming which under achievement is acceptable
Achievement Function: The function that serves to measure the achievement of the minimization of unwanted goal
deviation variables in the goal programming model.
Goal Function: A mathematical function that is to be achieved at a specified level.
Goal Program: A mathematical model, consisting of linear or nonlinear functions and continuous or discrete
variables, in which all functions have been transformed into goals.
Constraint: A constraint is a restriction upon the decision variables that must be satisfied in order for the solution to
be implementable in practice. This is distinct from the concept of a goal whose non-achievement does not
automatically make the solution non-implementable. A constraint is normally a function of several decision
variables and can be equality or an inequality.
Sign Restriction: A sign restriction limits a single decision or deviational variable to only take certain values within
its range. The most common sign restriction is for the variable to be non-negative and continuous.
Feasible Region: The set of solutions in decision space that satisfy all constraints and sign restrictions in a goal
programming form the feasible region. Any solution that falls within the feasible region is deemed to be
implementable in practice.
Ideal Point: The point in objective space at which each objective in a multi-objective optimization problem takes its
optimal value when optimized individually, within the feasible region, is known as the ideal point. If the objectives
are conflicting then this point will be outside the feasible region in objective space and hence an infeasible point.
Nevertheless, it provides a useful point of reference to measure the goodness of any solution against. In goal
programming, the ideal point is used to calculate the normalization constants when using zero–one normalization.
5.5 Underlying Philosophies

In order to utilize goal programme fully, it is important to understand the philosophies and economic concepts that
support the mathematics and statistics. This will ensure that the correct goal programming variants are chosen and
the parameters are set appropriately. This section details the major underlying philosophies of goal programming.

5.5.1 Satisficing

Goal programming is often cited as being primarily a satisficing-based technique. The term satisficing and related
verb ‘to satisfice’ were introduced by the American economist Herbert Simon (Simon, 1957). Satisficing comes
from the words ‘satisfy ‘and ‘suffice’. It describes a behaviour in which decision makers aim to reach a set of
defined goals. If they reach those goals then this suffices for them in that decision situation and they are hence
satisfied. This is an alternative to the philosophy of optimizing outlined in Section 5.5.2, as Simon’s argument is that
human beings are more interested and able to reach goals than in the abstract concept of optimizing each outcome of
the decision problem. The linkage between satisficing and goal programming is clear. All goal programming models
contain a set of goal values to be reached. Meeting these goals as closely as possible is the main aim of the goal
programming. Thus satisficing can be rightly thought of as the prime underlying philosophy of goal programming.
However, as will be shown in the following sections, it is not necessarily the sole underlying philosophy.
5.5.2 Optimizing

To optimize in the context of decision making means to find the decision which gives the best possible value of
some measure from amongst the set of possible decisions. The theory of optimizing in the presence of multiple
objectives is defined by adapting a concept from the work of the Italian economist Vilfredo Pareto into the field of
decision making. Pareto (1896) defined a society as being in an optimal state if no individual could become richer
without making another individual poorer.

Goal programming contains elements of optimizing. There are three situations to note where the optimizing
philosophy has particular importance:
(i) If the goal target levels are set very optimistically, such as at their ideal values, in the goal programme, then
the dominant underlying philosophy has changed from satisficing to optimizing.
(ii) If Pareto optimality detection and restoration take place then the goal programme has a mix of the
satisficing and optimizing philosophies.
(iii) If the goals are two-sided (i.e. a particular value is optimal rather than a ‘more is better’ or ‘less is better’
situation) then the satisficing and optimizing philosophies can be thought of as coinciding for those goals.
5.5.3 Ordering or Ranking

This underlying philosophy is important in the lexicographic variant. In this variant, the minimization of unwanted
deviations from goals takes place according to a weak order. In lexicographic goal programming, it is assumed that
the weak ranking of the goals in terms of importance exists and is known (or able to be estimated) by the decision
maker.

5.5.4 Balancing

In many goal programming problems it is insufficient to consider solely the average level of achievement of the
goals without looking at the balance between the achievements of the goals. In order to illustrate this fact, the
following table shows two solutions to a simple two-goal programming where negative deviations from the target
level are unwanted. The two solutions have the same average level of achievement but different levels of balance
between goals.

Example of two-goal model

Goal 1 target Goal 1 achieved Goal 2 target Goal 2 achieved

Solution 1 100 90` 100 90

Solution 2 100` 100 100 80

Clearly, if balancing the achievement of the goals is of any importance to the decision maker then they will prefer
solution 2 over solution 1. However, if only the average level of achievement is considered when solving the goal
programme then solutions 1 and 2 are shown to have the same value to the decision maker. Omitting the balancing
element from a goal programme when it should be included is, in our view, one of the major reasons why
unbalanced and hence unattractive and implementable solutions are sometimes incorrectly produced by poor goal
programming modelling.

5.6 Formulation of goal programming

In earlier days, profit maximization was considered as prime goal of management. But now a days, decision criteria
for today’s management is multidimensional and decision process involve multiple goals. Goal programming can be
employed in decision problems with a single goal (objective) and multiple sub goals, as well as in cases having
multiple goals and sub goals. With in goal programming model, goals may be achieved only at the expense of other
goals. The goal programming necessitates the establishment of a weighting system for the goals such that lower-
ranked (or weighted) goals are considered only after higher-ranked goals have been satisfied or have reached the
point beyond which no further improvement is desirable. Thus, goals are arranged in order of importance and their
contribution to organization well-being. This weights can be ordinal or cardinal.

Model formulation is the process of transforming a real word decision problem into an operations research model. A
key to successful application of goal programming is the ability to recognize when a problem can be solved by goal
programming and to formulate the corresponding model. Goal programming is a form of linear programming, goal
programming models must be formulated under the same limitations, assumptions, and conditions as linear
programming models (linearity, divisibility, determinism, etc.). Goal programming problems can also be solved by
using the simplex method (in a modified form).In goal programming, the objective function primarily contains
deviational variables that are represented in two dimension in objective functions i.e. a positive deviation and
negative deviation for each sub-goal and for constraint. The deviations between the goals and what can be achieved
within the set of constraints are minimized.

As GP is an extension of Linear programming, the general GP model can be formulated as follows:

m
Minimize Z =  w (d
i 1
i

i  di )

Subject to the constraints

n

a x
j 1
ij j  di  di  bi ; i  1, 2,..., m

and x j , di , di  0  i & j

where

m = goals are expressed by as m-component column bi

aij = the coefficient matrix for the jth decision variables in the ith constraint
xj = a decision variable
wi = weight of each goal
di = negative deviational variable from ith goal which represents the amount of underachievement (called slack
variable in LP)

di = positive deviational variable from ith goal which represents the amount of overachievement (called surplus
variable in LP)

The objective function becomes the minimization of positive and negative deviational variables based on the relative
importance or priority assigned to them. Since both under and overachievement of a goal cannot be achieved
simultaneously, one or both of these deviational variables ( di or di ) be zero in the solution, i.e. di × di =0. In
other words, if one assumes a positive value in the solution, the other must be zero and vice versa.
The deviational variables di (called surplus variable in LP) is removed from the objective function of GP when
overachievement is acceptable. Similarly, if underachievement is acceptable, di (called slack variable in LP) is
removed from the objective function of G.P. But if exact attainment of the goal is desired, then both di and di are
included in the objective function and ranked according to their pre-emptive priority factor, from the most important
to the least important.

Steps in Model Formulation (Algorithm): Goal Programming

(i) Define decision variables and constants. The first step in model formulation is the definition of decision
variables (x1, x2,…, xn) and the right hand side constants. The right hand side constants may be either
available resources or specified goal levels.

(ii) Formulate constraints. The next step is to formulate a set of constraints. A constraint may be either a
system constraint or a goal constraint.

(iii) Develop the objective function. Through the analysis of the decision maker’s goal structure, the objective
function must be developed. If goals are classified in k ranks, the preemptive priority factors (symbolized
by P1, P2, and so on) should be assigned to deviational variables according to their order of importance. If
necessary, differential weights must be assigned to deviational variables at the same priority level.

Types of Goal Models

There are two types of goal models namely single goal models and multiple goal models. Multiple goal models are
further divided into (i) multi-goal with equal number of priorities/non-priorities (ii) multi-goal with unequal
priorities and (iii) multi-goal with priorities and weights.

5.6.1 Goal Programming Formulation (Single Goal Models with Multiple Sub-goals)

An objective (goal) is the result desired by a decision maker. The goal may be underachieved, fully achieved, or
overachieved within the given decision environment. The degree of goal achievement depends upon the relative
managerial effort applied to an activity. Mathematically, 1 unit of effort applied to activity xj might contribute an
amount aij toward the ith goal.

If the target level for the ith goal is fully achieved, then the ith constraint is written as

a x
j 1
ij j  bi ; i  1, 2,..., m

If the target level for the ith goal is underachieved or overachieved, then the ith constraint is written as

a x
j 1
ij j  di  di  bi ; i  1, 2,..., m , where

di = negative deviational variable from ith goal which represents the amount of underachievement (called slack
variable in LP)

di = positive deviational variable from ith goal which represents the amount of overachievement (called surplus
variable in LP)

Thus, the single goal programming model can be formulated as follows:

Minimize Z = di + di

Subject to the constraints

a x
j 1
ij j  bi ; i  1, 2,..., m , if the target level for the ith goal is fully achieved.

a x
j 1
ij j  di  di  bi ; i  1, 2,..., m
, if the target level for the ith goal is underachieved or overachieved.
 
and x j , d , d  0  i & j
i i

Since both under and overachievement of a goal cannot be achieved simultaneously, one or both of these deviational
variables ( di or di ) be zero in the solution, i.e. di × di =0.

The example of single goal model of goal programming is explained below.

Example1. A producer produces two products A and B. Each product requires time in two production departments P
and Q. Product A requires 20 hours in department1 and 10 hours in department 2. Product B requires 10 hours in
department1 and 10 hours in department 2. Production time is limited in department to 60 hours and in department 2
to 40 hours. The contributions to profits for the two products are Rs40 and Rs80 respectively. Management’s goal is
to maximize profits. Formulate the Goal Programming model if the goal of the producer is to earn a profit of
Rs.1000 and solve it by simplex method.

Solution:

LP Formulation

Let x1 and x2 be the total number of products A and B produced from two departments respectively. Also, let Z be
the objective function which is to be maximized the total profit. Then, LP model can be formulated as follows:

Department Products Production time limited

A B

P 20 10 60

Q 10 10 40

Profit earned 402 80

Maximize Z = 40x1 + 80x2

Subject to the constraints
20x1 + 10x2 ≤ 60
10x1 + 10x2 ≤ 40 and x1 , x2 ≥0
After adding slack variables s1 and s2 to the given constraints become
Maximize Z= 40x1 + 80x2 + 0.s1 + 0.s2
Subject to the constraints
20x1 + 10x2 + s1 = 60
10x1 + 10x2 + s2 = 40
 and x1, x2, s1, s2 > 0
20.x1 + 10.x2 + 1.s1 + 0.s2 = 60
i.e., 10.x1 + 10.x2 + 0.s1 + 1.s2 = 40 } (1)

The equation (1) can be written in matrix form AX = b as

 x1 
 20 10 1 0   x2  =  60 
 10 10 0 1   s1   40 
 s2 
A X b
Here, an identity matrix appears by taking the coefficients of s1 and s2. So, these are initial basic variables for
initial simplex tableau.
Simplex tableau - 1
Cj 40 80 0 0
Ratio
CB XB bi x1 x2 s1 s2
60
0 s1 60 20 10 1 0 =6
10
40
0 s2 40 10 10 0 1 =4
10
Zj 0 0 0 0 0
Zj – Cj –40 –80 0 0

key row
key column
Since two values of Zj - Cj are negative, an optimum feasible solution has not been obtained.
Here, most negative value of Zj - Cj is -80. So, x2 - column is the key column and x2 is an entering variable.
Again, the minimum positive ratio value is 4. So, corresponding s2-row is a key row, s2 is a leaving variable and
10 is a key element.
40 10 10 0 1
Now, elements in main row (R2) : 10 = 4, 10 =1, 10 = 1, 10 =0, 10 = 0.1.

The elements of R1 can be obtained by using formula.

Elements in old Intersectional element of Elements in Elements in
row R1 -  =
old row R1 main row new row R1
60 - 10  4 = 20
20 - 10  1 = 10
10 - 10  1 = 0
1 - 10  0 = 1
0 - 10  0.1 = -1
Simplex tableau - 2
Cj 40 80 0 0
Ratio
CB XB bi x1 x2 s1 s2
0 s1 20 10 0 1 -1 -
80 x2 4 1 1 0 0.1 -
Zj 320 80 80 0 8
Zj – Cj 40 0 0 8
LP solution:
Since all (Zj – Cj) > 0, an optimum feasible solution has been obtained. Thus,
Max Z = Rs.320 when x1 = 0, x2 = 4, s1 =20 and s2=0.
Here, s1 = 20 means 20 hours of slack time remain in department P.
S2 = 0 means no slack time remains in department Q.
Goal Programming Formulation
The GP model can be formulated as follows:
Minimize Z = d1
Subject to the constraints
20x1 + 10x2 ≤ 60
10x1 + 10x2 ≤ 40
40x1 + 80x2 + d1 - d1 =1000 (target). This represents the goal equation.
and x1 , x2, d1 , d1 ≥0, where x’s represents the decision variables and d’s represents deviational variables.
Discussion:
(i) The LP model and GP model have different objective functions. In GP model, goal equation is added as
profit which is the goal in this case.
(ii) The non-negative variables di and di are called deviational variables for goal equation. They represent
the amount by which we underachieve or overachieve di the profit goal of Rs.1000.
(iii) We are seeking to maximize goal so we set an arbitrarily high goal to Rs1000.
(iv) If the goal is exactly achieved, the both deviational variables will be zero. If the goal cannot be achieved,
then one or other deviational variables will be zero.
(v) Since our objective is to maximize the profit, the objective function of GP model will contain only a
deviational variable.
(vi) In above GP model, only di will be included in objective function. Our objective in GP form is to
minimize the underachievement of the profit goal.
(vii) As underachievement is undesirable, we would like to derive di as closer to zero.
(viii) Since the deviational variables can be treated like any other variables, we can solve the GP formulation of
the problem by the simplex method.
(ix) Solve the GP model by simplex method as follows:
GP Simplex tableau - 1
Cj 0 0 0 0 1 0
Ratio
CB XB bi x1 x2 s1 s2 d 
i
di
0 0 60
0 s1 60 20 10 1 0 =6
10
40
s2 =4
0 40 10 10 0 1 0 0 10
1000

=12.5
1 d 1000 40 80 0 0 1 -1 80
i

Zj 0 40 80 0 0 1 -1
key row Zj – Cj 40 80 0 0 1 -1

key column

Since all values of Zj - Cj (except one value) are positive and zero, an optimum feasible solution has not been
obtained.
Here, most positive value of Zj - Cj is 80. So, x2 - column is the key column and x2 is an entering variable.
Again, the minimum positive ratio value is 4. So, corresponding s2-row is a key row, s2 is a leaving variable and
10 is a key element.
40 10 10 0 1 0 0
Now, elements in main row (R2) : 10 = 4, 10 =1, 10 = 1, 10 =0, 10 = 0.1, 10 =0, 10 =0.

The elements of R1 can be obtained by using formula.

Elements in old Intersectional element of Elements in Elements in
row R1 -  =
old row R1 main row new row R1
60 - 10  4 = 20
20 - 10  1 = 10
10 - 10  1 = 0
1 - 10  0 = 1
0 - 10  0.1 = -1
0 - 10  0 = 0
0 - 10  0 = 0

The elements of R3 can be obtained by using formula.

Elements in old Intersectional element of Elements in Elements in
row R3 -  =
old row R3 main row new row R3
1000 - 80  4 = 680
40 - 80  1 = -40
80 - 80  1 = 0
0 - 80  0 = 1
0 - 80  0.1 = -8
1 - 80  0 = 1
-1 - 80  0 = -1

GP Simplex tableau - 2

Cj 0 0 0 0 1 0 Ratio
CB XB
bi x1 x2 s1 s2 di di
0 s1 20 10 0 1 -1 0 0 -
0 x2 4 1 1 0 0.1 0 0 -
1 di 680 -40 0 1 -8 1 -1 -
Zj 680 -40 0 1 -8 1 -1
Zj - Cj -40 0 0 -8 0 -1

GP solution:
Since all (Zj – Cj) ≤0, an optimum feasible solution has been obtained. Thus,
Max Z =Min Z= Rs.680 when x1 = 0, x2 = 4, s1 =20 and s2=0, di = 680 and di =0.
This is similar to previous answer of Z= Rs.680.The value of Z for GP solution reflects the extent by which we
underachieve our profit goal of Rs.1000. Actual maximum profit for the problem is Rs.320 ( Rs.1000- Rs.680)
identical to LP solution.

5.6.2 Goal Programming Formulation (Multi-goal with equal number of priorities/non-priorities)

Example 2: An office equipment manufactures produces two kinds of products A and B. Production of either A or
requires 1 hour of production capacity in the plant. The plant has a maximum production capacity of 10 hours per
day. The gross margin from the sale of a product A is 180 and 140 for a product B. Formulate a goal programming
model if the goal of the office is to earn a profit of 600 per day.

Solution:

Let x1 and x2 be the number of units of products A and B produced per day respectively. Let Z be the objective
function which is to be maximized the profit. Then, required LP model can be formulated as follows:

Maximize Z= 180x1 + 140x2

Subject to the constraints
x1 + x2 ≤ 10 and x1, x2 ≥0
Now, the goal for the GP is to earn the profit Rs.600 per day. Thus, the constraint of this goal is
180x1 + 140x2 + d1 - d1 = 600

Hence, the required GP model can be formulated as follows:

Minimize Z = d1 + d1

Subject to the constraints
x1 + x2 ≤ 10
180x1 + 140x2 + d1 - d1 = 600 and x1, x2, d1 , d1 ≥0 , where
d1 = underachievement of profit of Rs.600 and d1 = overachievement of profit of Rs.600
Example3. Formulate a goal programming model, given in Example 2, with the following equally ranked goals.
(i) To earn a profit of 800 per day.
(ii) Because of the limited sales capacity the maximum number of A and B that can be sold are 6 and 8 per day
respectively.
Solution:
Let x1 and x2 be number of units of products A and B produced per day respectively. Then, the required LP model is

Maximize Z= 180x1 + 140x2

Subject to the constraints
x1 + x2 ≤ 10 and x1, x2 ≥0
Now, the goals for the GP are (i) Earn the profit of 800 and (ii) Maximum no. of A and B that can be sold are 6 and
8 respectively.
Thus, the GP goal for (i) is
180x1 + 140x2 + d1 - d1 = 800
Thus, the GP goal for (ii) is
x1 + d2 = 6
x2 + d3 = 8, where
d1 = The underachievement of profit of Rs.800; d1 = the overachievement of profit of Rs.800
d2 = The underachievement of sale target 6 of A; d3 = the overachievement of sale target 8 of B
Hence, the required goal programming model is
Minimize Z = d1 + d2 + d3
Subject to the constraints
180x1 + 140x2 + d1 - d1 = 800
x1 + x2 ≤ 10
x1 + d2 = 6
x2 + d3 = 8 and x1, x2, d1 , d1 , d2 , d3 ≥0
Example 4. A company manufactures two products radio and transistors which must be processed through assembly
and finishing departments. Assembly has 90 hours available; finishing can handle up to 72 hours of work.
Manufacturing one radio requires 6 hours in assembly and 3 hours in finishing. Each transition requires 2 hours in
assembly and 4 hours in finishing. If profit is 1.20 per radio and 1.90 per transistor, determine the best combination
of radios and transistors to realize a maximum profit of 2000. Formulate a problem as a GP problem.
Solution:
Let x1 and x2 be number of units of radios and transistors produced respectively. Also, let Z be the objective function
which is to be maximized the profit. Then, LP model can be formulated as follows:
Maximize Z = 1.29 x1 + 1.90x2
Subject to the constraints
6x1 +2x2 ≤ 90 (assembly constraints)
3x1 + 4x2 ≤ 72(finishing constraints) and x1, x2 ≥0
Now the goal for the GP is earn maximum profit of Rs2000. Then, the required GP model is as follows:
Minimize Z = d1
Subject to the constraints
1.29 x1 + 1.90x2 + d1 - d1 = 2000
6x1 +2x2 ≤ 90
3x1 + 4x2 ≤ 72 and x1, x2 , d1 , d1 ≥0, where
d1 = The underachievement of profit of Rs.2000; d1 = the overachievement of profit of Rs.2000
Example5. In the problem given in Example 4, the company sets the following equally ranked goals:
(i) Reach a profit goal of 1500.
(ii) Meet a product of radio goal of 10. Formulate a GP problem.
Solution:
Let x1 and x2 be number of units of radios and transistors produced respectively. Also, let Z be the objective function
which is to be maximized the profit. Then, LP model can be formulated as follows:
Maximize Z = 1.29 x1 + 1.90x2
Subject to the constraints
6x1 +2x2 ≤ 90 (assembly constraints)
3x1 + 4x2 ≤ 72(finishing constraints) and x1, x2 ≥0.
Now the goals for the GP are (i) reach a profit goal of Rs1500 and (ii) meet a product of radio goal of 10. Then, the
required GP model is as follows:
Minimize Z = d1 + d2
Subject to the constraints
1.29 x1 + 1.90x2 + d1 - d1 = 1500
6x1 +2x2 ≤ 90
3x1 + 4x2 ≤ 72
x1 + d2 − d2 = 10
and x1, x2 , d1 , d1 , d2 , d2 ≥0, where
d1 = The underachievement of profit of Rs.1500; d1 = the overachievement of profit of Rs.1500
d2 = The underachievement of product of radio goal of 10; d2 = the overachievement of product of radio goal of 10
Example6. An office equipment manufactures produces two kinds of products chair and lamp. Production of either
requires one hour of production capacity in the plant. The plant has a maximum production capacity of 50 hours per
week because of the limited sales capacity, the maximum number of chairs and lamps that can be sold are 6 and 8
respectively. The gross margin from sale of chair is 90 and 60 for a lamp. The plant manager desires to determine
the number of units of each product that should be produced per week in consideration of the following equally
ranked goals.
Goal 1: Available production capacity should be utilized as much as possible but not exceeded.
Goal 2: Sales of two products should be as much as possible.
Goal 3: Overtime should not exceed 20% of available production time.
Formulate the problem as a Goal programming.
Solution:
Let x1 and x2 be the number of units of chairs and lamps produced respectively. Also, let Z be the objective function
which is to be maximized respectively. Then, the required LP model can be formulated as follows:
Maximize Z = 90x1 + 60x2
x1 + x2 =50
x1≤6
x2 ≤8 and x1 , x2 ≥0
According three goals, the GP model can be constructed as follows:
Minimize Z = d1 + d2 + d3 + d4
Subject to the constraints
x1 + x2 + d1 - d1 =50
x1 + d2 = 6
x2 + d3 =8
d1 + d4 - d4 = 0.20 × 50 = 10 and x1 , x2 , d1 , d1 , d2 , d3 , d4 , d4 ≥0
Example 7: A manufacturing firm produces two types of products A and B. The unit profit from A is 100 and that
from B is 50. The goal of the firm is to earn a total profit of exactly 1700 in the next week. Formulate the problem as
goal programming.
Solution:
Let x1 and x2 be the number of products A and B produced respectively. Given that the goal of the firm is to earn a
profit of exactly 1700 per week, then the required GP model can be formulated as follows:
Minimize Z = d1 + d1
Subject to the constraints
100x1 + 50x2 + d1 - d1 = 1700
and x1 , x2 , d1 , d1 ≥0
5.6.3 Goal Programming Formulation (Multi-goal with unequal priorities)

In any firm or industry, when management has multiple goals, then they always put their goals in order to their
priorities, i.e., they want the most important goals to be achieved fully or very near to the full satisfaction in
comparison to other. To form the goal programming in such situation, we assign the priority coefficients P1, P2, P3,.
.. These priority coefficients have no numerical value, they simply represent the level of priorities.
Steps Followed:
For the given LPP,
Step1. Construct the goal constructs.
Step2. Construct the Goal objective function.
Step3. Formulate the Goal Programming (GP) Problem by combining steps 1 and 2.
Example8. A firm manufactures two products. Each product requires time in two production departments. Product 1
requires 20 hours in department-1 and 10 hours in department-2. Product 2 requires 10 hours in department-1 and 10
hours in department-2. Production time is limited in departments as 160 and 140 hours respectively. Contribution to
profits by two products are 40 and 80 respectively. Management has established the following goal priorities.
Priority-1 (P1): to meet production goals of 2 units of each product
Priority-2 (P2): to earn profit of 4000.
Formulate the goal programming problem.
Solution:
Let x1 and x2 be the number of products 1 and 2 produced respectively. Also, let Z be the objective function which is
to be maximized the profit. Then, the required LP model can be formulated as follows:
Maximize Z = 40x1 + 80x2
Subject to the constraints
20x1 + 10x2 ≤ 160 (Department-1)
10x1 + 10x2 ≤ 140 (Department -2)
and x1, x2 ≥ 0.
Goal Programming Problem:
Let P1 and P2 be the goal priorities. Then, GP model can be formulated as follows:
Minimize Z = P1( d1 + d2 ) + P2 d3
Subject to the constraints
x1 + d1 - d1 = 2
x2 + d2 - d2 = 2
40x1 + 80x2 + d3 - d3 = 4000
20x1 + 10x2 ≤ 160
10x1 + 10x2 ≤ 140 and x1, x2 , d1 , d1 , d2 , d2 , d3 , d3 ≥ 0.
Example9. A company produces two kinds of products A and B. Production of either A or B requires 3 hours of
production capacity in the plant. The plant has a maximum production capacity of 30 hours per week to manufacture
these two products, has set the following goals arranged in the order of importance.
(i) To avoid any underutilization of production capacity.
(ii) To limit the overtime to 5 hours.
(iii) To minimize the overtime operations of the plant as much as possible.
Formulate the problem as goal programming.
Solution:
Let x1 and x2 be the number of products A and B produced respectively. Then, the production capacity constraint is

3x1 + 3x2 ≤ 30

Let P1, P2 and P3 be the three goal priorities. Then, the required GP model can be constructed as follows:

Minimize Z = P1 d1 + P2 d2 + P3 d1

Subject to the constraints
3x1 + 3x2 + d1 - d1 =30
d1 + d2 - d2 = 5 and x1, x2 , d1 , d1 , d2 , d2 ≥ 0 , where
d1 and d1 are the underachievement and the overachievement of the production target respectively. Also, d2 and
d2 are the underachievement and the overachievement of the overtime target respectively.

Example10: A company manufactures two products radio and transistors which must be processed through
assembly and finishing departments. Assembly has 90 hours available; finishing can handle up to 72 hours of work.
Manufacturing one radio requires 6 hours in assembly and 3 hours in finishing. Each transition requires 3 hours in
assembly and 6 hours in finishing. The profit is 120 per radio and 90 per transistor. The company has established the
following goals according to their priorities P 1, P2, P3 (is most important) as
P1: produce to meet a radio goal of 13.
P2: reach a profit goal of 1950.
P3: produce to meet a transistor goal of 5.
Formulate a problem as a GP problem.
Solution:
Let x1 and x2 be the number of radios and transistors produced respectively. Also, let Z be the objective function
which is to be maximized respectively. Then, the required general LP model is
Maximize Z = 120x1 + 90x2
Subject to the constraints
6x1 + 3x2 ≤ 90 (Assembly constraints)
3x1 + 6x2 ≤ 72 (Finishing constraints)
and x1, x2 ≥ 0.
Again, the required GP model can be constructed as follows:

Minimize Z = P1 d1 + P2 d2 + P3 d3

Subject to the constraints

6x1 + 3x2 ≤ 90
3x1 + 6x2 ≤ 72
x1 + d1 - d1 =13
120x1 + 90x2 + d2 - d2 =1950
x3 + d3 - d3 =5 and x1, x2 , d1 , d1 , d2 , d2 , d3 , d3 ≥ 0.
5.6.4 Goal Programming Formulation (Multi-goal with priorities and weights)

The steps for formulating GP model under multi-goal with priorities and weights are same as the steps for
formulating GP model under multi-goal with priorities. But, in this case, weights are also considered.
Example11. A production manager is faced with the problem of job allocation to his two production teams. The
production rate of team-1 is 8 units per hour while of team-2 is 5 units per hour. The normal working hours for each
of the teams is 40 hours per week. The production manager has prioritized the following goals for the coming week.
P1: avoid underachievement of the desired production level of 650 units.
P2: overtime operation of team-1 is limited to 5 hours.
P3: the total overtime for both teams should be minimized.
P4: Any underutilization of regular working hours of the teams should be avoided by assigning different weights
according to the relative productivity of the two teams. Formulate the problem as GP model.
Solution:
Let x1 and x2 be the number of hours of working of team-1 and team-2 per week respectively. Also, P1, P2, P3 and
P4 be the four priorities goals. Then, the required GP model can be formulated as follows:
Minimize Z= P1 d1 + P2 d3 + P3 ( d2 + d4 ) + P4 (8 d2 + 5 d4 )
Subject to the constraints
8x1 + 5x2 + d1 - d1 =650
d2 + d3 - d3 = 5
x1 + d2 - d2 =40
x2 + d4 - d4 =40 and x1, x2 , d1 , d1 , d2 , d2 , d3 , d3 , d4 , d4 ≥ 0., where
d1 = the underachievement of production level of 650 units;
d1 = the overachievement of production level of 650 units.
d2 and d4 = the underachievement for overtime of team-1 and team-2
d2 and d4 = the overachievement for overtime of team-1 and team-2
d3 = the underachievement for overtime operation of team-1
d3 = the overachievement for overtime operation of team-1
Example12. Delton electronics manufactures two types of TV sets namely Deluxe and Supreme. Deluxe set requires
2 hours while in Supreme requires 4 hours assembly time. The normal assembly operation is limited to 80 hours per
week. Marketing surveys indicate that no more than 60 Deluxe and 30 Supreme TV sets should be produced each
week. The net profit from the Deluxe and Supreme model is Rs100 and Rs150 each. The company president has
started the following objectives in order of priority:
P1 :maximize total profit.
P2 : minimize overtime operation of the assembly line.
P3 :sell as many TV sets as possible.
The net profit from the Supreme model is 2 times that from the Deluxe model, the president has 2 times as much
desire to maximize the sale of the Supreme than Deluxe model. Formulate the goal programming model.
Solution:
Let x1 and x2 be the number of Deluxe and Supreme TVs respectively. Also, let Z be the objective function which
is to be maximized the profit. Then, the required LP model can be formulated as follows:
Maximize Z = 100x1 + 150x2
Subject to the constraints
2x1 + 4x2 ≤ 80 (Assembly constraints)
x1 ≤ 60 (Deluxe TVs)
x2 ≤ 30 (Supreme TVs)
and x1, x2 ≥ 0.
We assume that any starting high profit value as Rs.7000 per week. Then, the required GP model can be constructed
as follows:
Minimize Z= P1 d1 + P2 d2 + P3 (2 d3 + d4 ) or ( d1 , d2 , 2 d3 + d4 )
Subject to the constraints
100x1 + 150x2 + d1 - d1 =7000
2x1 + 4x2 + d2 - d2 = 80
x1 + d3 =60
x2 + d4 =30 and x1, x2 , d1 , d1 , d2 , d2 , d3 , d4 ≥ 0., where
d1 = the underachievement of profit level of Rs.7000;
d1 = the overachievement of profit level of Rs.7000.
d2 = the underachievement of assembly line 80.
d2 = the underachievement of assembly line 80.
d3 = the underachievement of sale of 60 Deluxe TVs.
d4 = the underachievement of sale of 30 Supreme TVs.
Example13. A textile company produces two types of materials A and B. The average production rates for the
materials A and B are identical at 1000 metres/hour. By running two shifts, the operational capacity of the plant is
80 hours per week. The marketing dept. reports that the maximum estimated sales for the following week is 70000
meters of material A and 45000 for B. According to the accounting dept., the profit from a metre of A is 2.50 and
from B is 1.50.The management of the company decides that a stable employment level is a primary goal for the
firm. Therefore, whenever there is a demand exceeding the normal production capacity, the management supply
expands production capacity by providing overtime. However, management feels that overtime operation of the
plant of more than 10 hours per week should be avoided because of the accelerating cost. The management has the
following goals in order of importance:
1) avoid any underutilization of production capacity.
2) limit the overtime operation of the plant to 10 hours.
3) Achieve the sales goal of A and B.
4) Minimize the overtime operation of plant as much as possible. Formulate the goal programming problem.
Solution:
Let x1 and x2 be the number of hours used per week for producing materials A and B respectively. Also, let Z be the
objective function which is to be maximized the profit. Then, LP model can be formulated as follows:
Maximize Z = 2.50x1 + 1.50x2
Subject to the constraints
x1 + x2 ≤ 80 (Production constraints)
1000x1 ≤ 70000 (Sales constraints)
1000x2 ≤ 45000 (Sales constraints)
and x1, x2 ≥ 0.
Let P1, P2, P3 and P4 be the four goal priorities. Then, the required GP model can be formulated as follows:
Minimize Z= P1 d1 + P2 d2 + P3 (5 d3 +3 d4 ) + P4 d1 or ( d1 , d2 , 5 d3 +3 d4 , d1 )
Subject to the constraints
x1 + x2 + d1 - d1 =80
d1 + d2 - d2 = 10
x1 + d3 =70
x2 + d4 =45 and x1, x2 , d1 , d1 , d2 , d2 , d3 , d4 ≥ 0., where
d1 = the underutilization of production capacity of 80hours;
d1 = the overutilization of production capacity of 80hours;.
d2 = the under estimate of over time operation from 10 hours
d2 = the under estimate of over time operation from 10 hours
d3 = the underestimate of sale goal of A.
d4 = the underestimate of sale goal of B.
Example 14. A manufacturing firm produces two types of products A and B. According to past experience,
production of either product A or B requires an average of one hour in the plant. The plant has a normal production
capacity of 400 hours a month. The marketing department of the firm reports that because of limited market, the
maximum number of products A and B that can be sold in a month are 240 and 300 respectively. The net profit for
the sale of products A and B are Rs.800 and Rs.400 respectively. The manager of the firm has set the following
goals in the order of importance.
P1: He/she wants to avoid any underutilization of normal production capacity.
P2: He/she wants to sell maximum possible units of products A and B. Since the net profit from the sale of A is the
twice of the product B, the manager has twice as much desire to achieve sales for the product A as for product B.
P3: He/she wants to minimize the overtime operation of the plant as much as possible.
Formulate and solve the problem by graphic method of goal programming.
Solution:
Formulation of GP: Let x1 and x2 be the number of units of products A and B produced respectively. The goal
constraints can be formulated as follows:
 Since overtime operation is allowed, the plant capacity constraint can be expressed as
x1 + x2 + d1 - d1 =400 (Capacity constraint) , where
d1 = the underutilization (idle time) of production capacity;
d1 = the overtime of production capacity;.
 Since the sales goals are maximum possible sales volume, the sales constraints can be expressed as
x1 + d2 =240 and x2 + d3 =300 (sales constraints) , where
d2 and d3 are the underachieves of sales of the goal for products A and B respectively.
 The goal programming model can be formulated as follows:
Minimize Z = P1 d1 + P2 (2 d2 + d3 ) + P3 d1 or ( d1 , 2 d2 + d3 , d1 )
Subject to the constraints
x1 + x2 + d1 - d1 =400
x1 + d2 =240
x2 + d3 =300 and x1, x2 , d1 , d1 , d2 , d2 , d3 ≥ 0, where P1, P2 and P3 be the three goal priorities
Working steps of Graphical solution:
(i) Graph all structural constraints.
(ii) Graph all goal constraints.
(iii) Identify the top- priority solution.
(iv) Move to the nest highest priority and determine the best solution without violating prior goals.
(v) Repeat the above step until all priorities are investigated.
Answer: x1 =240, x2 =300 , d1 =0, d2 =0, d3 =0 and d1 = 160.
Exercise -5
1. Solve the following GP problem graphically:
(i) Minimize Z = d1 + d1 (ii) Minimize Z = d1 + d2 + d3
Subject to the constraints Subject to the constraints
 
80x1 +40 x2 + d - d =800
1 1 80x1 +40 x2 + d1 - d1 =800
x1 + x2 ≤ 10 x1 + d2 =6
 
and x1, x2 , d , d ≥ 0.
1 1 x2 + d3 =8
and x1, x2 , d1 , d1 , d2 , d3 ≥ 0.
 (iii) Minimize Z = P1 d1 + P2 (2 d2 + d3 ) + (iv) Minimize Z = d1 + d2 + d3
P3 d1 Subject to the constraints
Subject to the constraints 20x1 +10x2 ≤ 60
10x1 +10x2 ≤ 40
x1 +x2 + d1 - d1 =10
80x1 +40 x2 + d1 - d1 =1000
x1 + d2 =6
x1 + d2 − d2 =2
x2 + d3 =8
   
x2 + d3 − d3 =2
and x1, x2 , d , d , d , d ≥ 0.
1 1 2 3
and x1, x2 , d1 , d1 , d2 , d2 , d3 , d3 ≥ 0.

Answers: 1. Profit = Rs.800 and GP problem solution is x1 = 10, x2 = 0, d1 =0, d1 =0 and Z = 0.
2. Profit = Rs.800 and GP problem solution is x1 = 6, x2 = 8, d1 =0, d2 =0, d3 =0, d1 =0 and
Z = 0.
3. GP problem solution is x1 = 6, x2 = 8, d1 =0, d2 =0, d3 =0, d1 =4 .
2. GP problem solution is x1 = 0, x2 = 4, d1 =680 (profit missed by 680 units), d2 =2, d3
=2, d1 =0, d1 =0, d2 =0, d3 =0.
2. A factory can manufacture two products A and B. The profit on one unit of A is Rs.80 and one unit of
B Rs.40. The maximum demand of A is 6 units per week, and of B it is 8 units per week. The
manufacturer has set up a goal of achieving a profit of Rs.640 per week. Formulate the problem as goal
programming and solve it.
3. A company produces two products A and B, both of which are manufactured on the same plant. The
production rate for each product is one per hour. The operational capacity of the plant is 80 hours per
week. The estimated maximum sales per week for the products A and B are 70 and 45 respectively,
and production is not to exceed these figures.
In order to meet the market demand, the company can run the plant overtime which may be around 10
hours per week. Net profits from sales of A and B are in the ratio 5:3. The company has listed the
following four goals in order of priorities denoted by P 1, P2, P3 and P4.
P1: Keep under-utilization of the production capacity as low as possible to avoid retrenchment of
workers.
P2: Overtime operation of the plant to exceed 10 hours as small as possible.
P3: Shortfall in production of 70 items of product A and 45 items of product B to be as low as possible.
The profits in sale of A and B being in the ratio 5:3, the priorities of keeping the production of A
close to 70 and of B close of to 45 may also be taken in the same ratio.
P4: Keeping the overtime operation of the plant as low as possible.
Formulate the problem as goal programming and solve it.