CEMENT INDUSTRY

OPERATION RESEARCH
 GROUP :- 14
⃰ PRACHI BHIMANI
⃰ RACHITA REVANKER
⃰ SHAZIA USMANI
⃰ SUJATA SALVE
⃰ SONIA DESHMUKH
BRIEF HISTORY
⃰ Jaypee group was founded by Mr. Jaiprakash
Gaur in 1957.
⃰ Jaypee group is five decade old conglomerate
based in Noida, India.
⃰ In 1979, Jaiprakash Associates Private Ltd (JAPL)
was formed.
⃰ In 1980, Jaypee Group entered into Hospitality
sector and set up Hotels Siddharth and Vasant
Continental.
⃰In 1983, Jaypee Rewa Cement Plant (JRCL) was
established with an initial capacity of 1 million
tonnes.
⃰In 1986, Jaiprakash Industries Limited (JIL) was
formed by amalgamating JAPL into JRCL.
⃰ In 2003, Jaiprakash Associates Ltd. (JAL) was
formed by merging JIL with JCL.
⃰In 2005, shares of JHPL were listed on BSE/NSE
and JHPL became the first Hydropower company
to be publicly held and listed in India.
TRANSPORTATION PROBLEM :

Jaypee has three production facilities - Bhuj,

Baroda & Vapi. With production capacity of 7,
9, 18 units (in 100s) per week of product
respectively. These units are transported to 4
warehouses- Ahmadabad, Gandhidham, Surat
and Rajkot. With requirement of 5,6,7, and 14
units( in 100s) per week respectively. The
transportation cost (in rupees) per unit
between factories to warehouses are given in
the table
 WAREHOUSES

    D1 D2 D3 D4  

GANDHI
  PRODUCTION PLANT AHEMDABAD DHAM SURAT RAJKOT CAPACITY

S1 BHUJ 19 30 50 10 7

S2 BARODA 70 30 40 60 9

S3 VAPI 40 8 70 20 18

  DEMAND 5 8 7 14 34
 LP MODEL
Let xij = no. of units of the product to be transported from the factory
i(i=1,2,3) to warehouse j( j=1,2,3,4)

Minimize( total transportation cost) z=19x11 + 30x12 + 50x13 + 10x14

+70x21 + 30x22 + 40x23 + 60x24 + 40x31 + 8x32 + 70x33 + 20x34

Subject to constraints
(i) Capacity to constraints
x11 + x12 + x13 + x14= 7
x21 + x22 + x23 + x24= 9
x31 + x32 + x33 + x34=18
(ii) Requirement constraints
x11 + x21 + x31 = 5
x12 + x22 + x32 = 8
x13 + x23 + x33 = 7
x14 + x24 + x34 = 14
xij >or= for i and j
NORTHWEST CORNER METHOD

 It is a simple and efficient method to obtain an initial

solution.
 This method does not take into account the cost of
transportation on any route of transportation.
  D1 D2 D3 D4  

S1 19 5 30 2 50 10 7

6 3
S2 70 30 40 60 9

4 14
S3 40 8 70 20 18

  5 8 7 14 34
 m are the number of rows and n are the number of
columns
 By moving in the same manner horizontally and vertically
as successive demand and supply are met, we ensure
that the solution is feasible, i.e. no. of positive allocations
( occupied cells) is equal to m+n-1=3+4-1=6
 The total transportation cost of the solution is
 Total cost =
5*19 + 2*30 + 6*30 + 3*40 + 4*70 + 14*20 = Rs. 1,015
 LEAST COST METHOD

 The object is to minimize the total transportation cost.

 We must try to transport as much as possible through

those routes where the unit transportation cost is lowest.

 This method takes into account the minimum cost of

transportation for obtaining initial solutions.
  D1 D2 D3 D4  supply

7
S1 19 30 50 10 7

2
S2 70 30 40 7 60 9

3 8 7
S3 40 8 70 20 18

 demand 5 8 7 14 34
 The total transportation cost of initial solution by LCM is

 Total cost =
7*10 + 2*70 + 7*40 + 3*40 + 8*8 + 7*20 = Rs. 814
 Vogel’s approximation method (VAM)
D1 D2 D3 D4 Supply
ROW DIFFERENCE

S1 19 30 50 10 7 9 9 40 40
5 2
S2 70 30 40 60 9
10 20 20 20
7 2
S3 40 8 70 20 18
8 10 12 20 50 -
Demand 5 8 7 14 34

21 22 10 10
COLUMN 21 - 10 10
DIFF
- - 10 10
- - 10 50
 Total cost
=5*19+2*10+7*40+2*6+8*8+10*20
=Rs 779
MODIFIED DISTRIBUTION
METHOD(MODI)

• m+n-1= Number of Allocations

3 + 4 – 1 = 6 = Number of Allocations

CER = min ( 2, 8)
=2
 MODI
D1 D2 D3 D4 SUPPLY ui

S1 19 30 50 10 7
5 32 60 2 u1=0
S2 70 30 (+) 40 60 (-) 9
u2=50
1 -18 2
S3 40 8 70 20 18
u3=10
(-) (+)
11 8 70 10

S4 5 8 7 14 34

vj v1=19 v2= -2 v3= -10 v4= 10

 CELL EVALUATION RESULT
= MIN(2,8)

D1 D2 D3 D4 SUPPLY ui

S1 19 30 50 10 7
5 32 42 2 u1=0
S2 70 30 40 60 9
u2=32
19 2 7 18
S3 40 8 70 20 18
u3=10

11 6 52 12

S4 5 8 7 14 34

vj v1=19 v2= -2 v3= -8 v4= 10

• All CER’s are positive
• Therefore solution is optimal
• The total cost
= 19*5 + 10*2 + 30*2 + 40*7 + 8*6 + 20*12
= Rs. 743
OPTIMAL SOLUTION

SUPPLY DEMAND UNITS

S1 D1 5
S1 D4 2
S2 D2 2
S2 D3 7
S3 D2 6
S3 D4 12
34
 CONCLUSION

 From all the above four methods MODI provides the

most optimal solution.

 MODI provides least transportation cost i.e. Rs. 743