9

Transportation,
Assignment,
and Network
Models
To accompany
Quantitative Analysis for Management, Twelfth Edition,
by Render, Stair, Hanna and Hale
Power Point slides created by Jeff Heyl Copyright ©2015 Pearson Education, Inc.
 LEARNING OBJECTIVES
After completing this chapter, students will be able to:

1. Structure LP problems for the transportation,

transshipment, and assignment models.
2. Solve facility location and other application
problems with transportation models.
3. Use LP to model shortest-route and maximal-flow
problems.
4. Solve minimal-spanning tree problems.

Copyright ©2015 Pearson Education, Inc. 9–2

 CHAPTER OUTLINE
9.1 Introduction
9.2 The Transportation Problem
9.3 The Assignment Problem
9.4 The Transshipment Problem
9.5 Maximal-Flow Problem
9.6 Shortest-Route Problem
9.7 Minimal-Spanning Tree Problem

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 Introduction
• LP problems modeled as networks
– Helps visualize and understand problems
• Transportation problem
• Transshipment problem
• Assignment problem
• Maximal-flow problem
• Shortest-route problem
• Minimal-spanning tree problem
– Specialized algorithms available

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 Introduction
• Common terminology for network
models
– Points on the network are referred to as
nodes
• Typically circles
– Lines on the network that connect nodes
are called arcs

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 The Transportation Problem
• Deals with the distribution of goods from
several points of supply (sources) to a
number of points of demand
(destinations)
– Usually given the capacity of goods at each
source and the requirements at each
destination
– Typically objective is to minimize total
transportation and production costs

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Linear Program for Transportation
• Executive Furniture Corporation
transportation problem
– Minimize transportation cost
– Meet demand
– Not exceed supply

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Linear Program for Transportation

Let Xij = number of units shipped from source i to

destination j
Where
i = 1, 2, 3, with 1 = Des Moines, 2 = Evansville,
and 3 = Fort Lauderdale
j = 1, 2, 3, with 1 = Albuquerque, 2 = Boston,
and 3 = Cleveland

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Linear Program for Transportation

Minimize total cost = 5X11 + 4X12 + 3X13 + 8X21 + 4X22 +

3X23 + 9X31 +7X32 + 5X33
Subject to:
X11 + X12 + X13 ≤ 100 (Des Moines supply)
X21 + X22 + X23 ≤ 300 (Evansville supply)
X31 + X32 + X33 ≤ 300 (Fort Lauderdale supply)
X11 + X21 + X31 = 300 (Albuquerque demand)
X12 + X22 + X32 = 200 (Boston demand)
X13 + X23 + X33 = 200 (Cleveland demand)
Xij ≥ 0 for all i and j
Copyright ©2015 Pearson Education, Inc. 9–9
Linear Program for Transportation

• Optimal solution
100 units from Des Moines to Albuquerque
200 units from Evansville to Boston
100 units from Evansville to Cleveland
200 units from Ft. Lauderdale to
Albuquerque
100 units from Ft. Lauderdale to Cleveland
Total cost = $3,900

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Linear Program for Transportation
FIGURE 9.1 – Network Representation of a Transportation Problem
Source Destination

Supply Demand

Des Moines $5 Albuquerque

100 (Source 1) (Destination 1) 300
$4
$3

$8
Evansville $4 Boston
300 200
(Source 2) (Destination 2)
$3

$9
$7 Cleveland
300 Fort Lauderdale 200
(Source 3) $5 (Destination 3)

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 Using Excel QM
PROGRAM 9.1 – Executive Furniture Corporation Solution in Excel 2013 Using Excel QM

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A General LP Model for Transportation
Problems
Let
Xij = number of units shipped from
source i to destination j
cij = cost of one unit from source i to
destination j
si = supply at source i
dj = demand at destination j

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A General LP Model for Transportation
Problems

Subject to:

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 Facility Location Analysis
• Transportation method especially useful
• New location is major financial importance
• Several alternative locations evaluated
• Subjective factors are considered
• Final decision also involves minimizing total
shipping and production costs
• Alternative facility locations analyzed within
the framework of one overall distribution
system

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 Facility Location Analysis
• Hardgrave Machine Company produces
computer components in Cincinnati, Salt Lake
City, and Pittsburgh
• Four warehouses in Detroit, Dallas, New York,
and Los Angeles
• Two new plant sites being considered –
Seattle and Birmingham
• Which of the new locations will yield the
lowest cost for the firm in combination with the
existing plants and warehouses?

Copyright ©2015 Pearson Education, Inc. 9 – 16

 Facility Location Analysis
TABLE 9.1 – Hardgrave’s Demand and Supply Data

MONTHLY COST TO
DEMAND PRODUCTION MONTHLY PRODUCE
WAREHOUSE (UNITS) PLANT SUPPLY ONE UNIT ($)
Detroit 10,000 Cincinnati 15,000 48
Dallas 12,000 Salt Lake City 6,000 50
New York 15,000 Pittsburgh 14,000 52
Los Angeles 9,000 35,000
46,000
Supply needed from a new plant = 46,000 – 35,000 = 11,000 units per month

ESTIMATED PRODUCTION COST

PER UNIT AT PROPOSED PLANTS
Seattle $53
Birmingham $49

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 Facility Location Analysis
TABLE 9.2 – Hardgrave’s Shipping Costs

TO LOS
FROM DETROIT DALLAS NEW YORK ANGELES
CINCINNATI $25 $55 $40 $60
SALT LAKE CITY 35 30 50 40
PITTSBURGH 36 45 26 66
SEATTLE 60 38 65 27
BIRMINGHAM 35 30 41 50

Solve two transportation problems

– one for each combination

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 Facility Location Analysis
Xij = number of units shipped from source i to
destination j

Where
i = 1, 2, 3, 4 with 1 = Cincinnati, 2 = Salt Lake
City, 3 = Pittsburgh, and 4 = Seattle
j = 1, 2, 3, 4 with 1 = Detroit, 2 = Dallas, 3 = New
York, and 4 = Los Angeles

Copyright ©2015 Pearson Education, Inc. 9 – 19

 Facility Location Analysis
Minimize total cost = 73X11 + 103X12 + 88X13 + 108X14 + 85X21 + 80X22 +
100X23 + 90X24 + 88X31 + 97X32 + 78X33
+ 118X34 + 113X41 + 91X42 + 118X43 + 80X44
Subject to:
X11 + X21 + X31 + X41 = 10,000 Detroit demand
X12 + X22 + X32 + X42 = 12,000 Dallas demand
X13 + X23 + X33 + X43 = 15,000 New York demand
X14 + X24 + X34 + X44 = 9,000 Los Angeles demand
X11 + X12 + X13 + X14 ≤ 15,000 Cincinnati supply
X21 + X22 + X23 + X24 ≤ 6,000 Salt Lake City supply
X31 + X32 + X33 + X34 ≤ 14,000 Pittsburgh supply
X41 + X42 + X43 + X44 ≤ 11,000 Seattle supply
All variables Xij ≥ 0
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 Facility Location Analysis
The total cost for the Seattle
alternative = $3,704,000
Minimize total cost = 73X11 + 103X12 + 88X13 + 108X14 + 85X21 + 80X22 +
100X23 + 90X24 + 88X31 + 97X32 + 78X33
+ 118X34 + 113X41 + 91X42 + 118X43 + 80X44
Subject to:
X11 + X21 + X31 + X41 = 10,000 Detroit demand
X12 + X22 + X32 + X42 = 12,000 Dallas demand
X13 + X23 + X33 + X43 = 15,000 New York demand
X14 + X24 + X34 + X44 = 9,000 Los Angeles demand
X11 + X12 + X13 + X14 ≤ 15,000 Cincinnati supply
X21 + X22 + X23 + X24 ≤ 6,000 Salt Lake City supply
X31 + X32 + X33 + X34 ≤ 14,000 Pittsburgh supply
X41 + X42 + X43 + X44 ≤ 11,000 Seattle supply
All variables Xij ≥ 0
Copyright ©2015 Pearson Education, Inc. 9 – 21
 Facility Location Analysis
The total cost for the Seattle
alternative = $3,704,000
Minimize total cost = 73X11 + 103X12 + 88X13 + 108X14 + 85X21 + 80X22 +
100X23 + 90X24 + 88X31 + 97X32 + 78X33
+ 118X34 + 113X41 + 91X42 + 118X43 + 80X44
Reformulating the problem
Subject to:
for the Birmingham
X11 + X21 + X31 + X41 = 10,000 Detroit demand
alternative and solving, the
X12 + X22 + X32 + X42 = 12,000 Dallas demand
total cost = $3,741,000
X13 + X23 + X33 + X43 = 15,000 New York demand
X14 + X24 + X34 + X44 = 9,000 Los Angeles demand
X11 + X12 + X13 + X14 ≤ 15,000 Cincinnati supply
X21 + X22 + X23 + X24 ≤ 6,000 Salt Lake City supply
X31 + X32 + X33 + X34 ≤ 14,000 Pittsburgh supply
X41 + X42 + X43 + X44 ≤ 11,000 Seattle supply
All variables Xij ≥ 0
Copyright ©2015 Pearson Education, Inc. 9 – 22
 Using Excel QM
PROGRAM 9.2 – Facility Location (Seattle) Solution in Excel 2013 Using Excel QM

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 Using Excel QM
PROGRAM 9.3 – Facility Location (Birmingham) Solution in Excel 2013 Using Excel QM

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Copyright ©2015 Pearson Education, Inc. 9 – 25
Copyright ©2015 Pearson Education, Inc. 9 – 26
Copyright ©2015 Pearson Education, Inc. 9 – 27
 The Assignment Problem
• This class of problem determines the
most efficient assignment of people or
equipment to particular tasks
• Objective is typically to minimize total
cost or total task time

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 Linear Program for
Assignment Example
• The Fix-it Shop has just received three new
repair projects that must be repaired quickly
1. A radio
2. A toaster oven
3. A coffee table
• Three workers with different talents are able
to do the jobs
• Owner estimates wage cost for workers on
projects
• Objective – minimize total cost

Copyright ©2015 Pearson Education, Inc. 9 – 29

 Linear Program for
Assignment Example
FIGURE 9.2 – Assignment Problem in a Transportation Network Format
Person Project

Supply Demand

Ali $11 Project 1

1 (Source 1) (Destination 1) 1
$14
$6

$8
Rashed $10 Project 2
1 1
(Source 2) (Destination 2)
$11

$9
$12 Project 3
1 Saeed 1
(Source 3) $7 (Destination 3)

Copyright ©2015 Pearson Education, Inc. 9 – 30

 Linear Program for
Assignment Example

Let

where

i = 1, 2, 3, with 1 = Ali, 2 = Rashed,

and 3 = Saeed
j = 1, 2, 3, with 1 = Project 1, 2 = Project 2,
and 3 = Project 3

Copyright ©2015 Pearson Education, Inc. 9 – 31

 Linear Program for
Assignment Example
Minimize total cost = 11X11 + 14X12 + 6X13 + 8X21
+ 10X22 + 11X23 + 9X31
+ 12X32 + 7X33

subject to
X11 + X12 + X13 =1
X21 + X22 + X23 =1
X31 + X32 + X33 =1
X11 + X21 + X31 =1
X12 + X22 + X32 =1
X13 + X23 + X33 =1
Copyright ©2015 Pearson Education, Inc. Xij = 0 or 1 for all i 9 – 32
 Linear Program for
Assignment Example
Minimize total cost = 11X11 + 14X12 + 6X13 + 8X21
+ 10X22 + 11X23 + 9X31
+ 12X32 + 7X33
Solution
subject to
X11X+ X =121,+Ali
X13assigned
≤ 1 to Project 3
13
X21X+ X = 1,
22 +Rashed
X23 ≤ assigned
1 to Project 2
22
X31X+ X = 1,
32 +Saeed
X33 ≤is1assigned to Project 1
31
X11 + X21 + X31 = 1
X12Total+ X22cost
+ X=32 $25= 1
X13 + X23 + X33 = 1
Xij Inc.
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 Using Excel QM
PROGRAM 9.4 – Mr. Fix-It Shop Assignment Solution in Excel 2013 Using Excel QM

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 Maximal-Flow Problem
• Determining the maximum amount of
material that can flow from one point
(the source) to another (the sink) in a
network
• Two common methods
– Linear programming
– Maximal-flow technique

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 Maximal-Flow Problem
• Determine maximum number of cars from
east to west for Waukesha WI road system
FIGURE 9.4 – Road Network for Waukesha Maximal-Flow Example

Capacity in Hundreds
of Cars per Hour

1 2 2
2 East
1 6
1 Point
3 0
West 2
1
Point
10 1 1
0
4
1
6
1
03 5
2
3

Copyright ©2015 Pearson Education, Inc. 9 – 36

 Maximal-Flow Problem
Variables
Xij = flow from node i to node j
where
i = 1, 2, 3, 4, 5, 6
j = 1, 2, 3, 4, 5, 6

Constraints necessary for

– Capacity of each arc
– Equal flows into and out of each node

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 Maximal-Flow Problem
Maximize flow = X61
subject to
X12 ≤ 3 X13 ≤ 10 X14 ≤ 2 Capacities for arcs from node 1
X21 ≤ 1 X24 ≤ 1 X26 ≤ 2 Capacities for arcs from node 2
X34 ≤ 3 X35 ≤ 2 Capacities for arcs from node 3
X42 ≤ 1 X43 ≤ 1 X46 ≤ 1 Capacities for arcs from node 4
X53 ≤ 1 X56 ≤ 6 Capacities for arcs from node 5
X62 ≤ 2 X64 ≤ 1 Capacities for arcs from node 6
(X21 + X61) – (X12 + X13 + X14) = 0 Flows into = flows out of node 1
(X12 + X42 + X62) – (X21 + X24 + X26) = 0 Flows into = flows out of node 2
(X13 + X43 + X53) – (X34 + X35) = 0 Flows into = flows out of node 3
(X14 + X24 + X34 + X64) – (X42 + X43 + X46) = 0 Flows into = flows out of node 4
(X35) – (X56 + X53) = 0 Flows into = flows out of node 5
(X26 + X46 + X56) – (X61 + X62 + X64) = 0 Flows into = flows out of node 6
Xij ≥ 0
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 Using Excel QM
PROGRAM 9.6 –
Waukesha Maximal-Flow
Solution

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 Minimal-Spanning Tree Problem
• Connecting all points of a network
together while minimizing the total
distance of the connections
• Linear programming can be used but is
complex
• Minimal-spanning tree technique is quite
easy

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 Minimal-Spanning Tree Problem
Steps for the Minimal-Spanning Tree Technique
1. Select any node in the network.
2. Connect this node to the nearest node that
minimizes the total distance.
3. Considering all of the nodes that are now
connected, find and connect the nearest node
that is not connected. If there is a tie for the
nearest node, select one arbitrarily. A tie suggests
there may be more than one optimal solution.
4. Repeat the third step until all nodes are
connected.

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 Minimal-Spanning Tree Problem
• Lauderdale Construction
FIGURE 9.6 – Network for
– Housing project in Lauderdale Construction

Panama City Beach

– Determine the 2
3
5
least expensive 3
5
4

way to provide 3 7
7
water and power 1 2 2
to each house 3
3 8
5 1
2 6
6
4

Gulf
Copyright ©2015 Pearson Education, Inc. 9 – 42
 Minimal-Spanning Tree Problem
Step 1 – Arbitrarily select FIGURE 9.7 – First Iteration
node 1
Step 2 – Connect node 1
to node 3 2
3
5
4
(nearest) 3
3
5
7
7
1 2 2
3
3 8
5 1
2 6
6
4

Gulf
Copyright ©2015 Pearson Education, Inc. 9 – 43
 Minimal-Spanning Tree Problem
Step 3 – Connect next nearest unconnected
node, node 4
Continue for other unconnected nodes
FIGURE 9.8 – Second and Third Iterations

3 3
2 5 2 5
4 4
3 3
5 5
3 7 3 7
7 7
1 2 1 2
2 2
3 3
3 8 3 8
5 1 5 1
2 6 2 6
6 6
4 4
(a) Second Iteration (b) Third Iteration
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 Minimal-Spanning Tree Problem
Step 4 – Repeat the process
FIGURE 9.9 – Last Four Iterations

3 3
2 5 2 5
4 4
3 3
5 5
3 7 3 7
7 7
1 2 1 2
2 2
3 3
3 8 3 8
5 1 5 1
2 6 2 6
6 6
4 4
(a) Fourth Iteration (b) Fifth Iteration

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 Minimal-Spanning Tree Problem
Step 4 – Repeat the process
FIGURE 9.9 – Last Four Iterations

3 3
2 5 2 5
4 4
3 3
5 5
3 7 3 7
7 7
1 2 1 2
2 2
3 3
3 8 3 8
5 1 5 1
2 6 2 6
6 6
4 4
(c) Sixth Iteration (d) Seventh Iteration

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 Minimal-Spanning Tree Problem
TABLE 9.4 – Summary of Steps in Lauderdale Construction Minimal-Spanning Tree Problem

CLOSE
CONNECTED UNCONNECTED UNCONNECTED ARC ARC TOTAL
STEP NODES NODES NODES SELECTED LENGTH DISTANCE
1 1 2, 3, 4, 5, 6, 7, 8 3 1–3 2 2
2 1, 3 2, 4, 5, 6, 7, 8 4 3–4 2 4
3 1, 3, 4 2, 5, 6, 7, 8 2 or 6 3–2 3 7
4 1, 2, 3, 4 5, 6, 7, 8 5 or 6 2–5 3 10
5 1, 2, 3, 4, 5 6, 7, 8 6 3–6 3 13
6 1, 2, 3, 4, 5, 6 7, 8 8 6–8 1 14
7 1, 2, 3, 4, 5, 6, 8 7 7 8–7 2 16

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 Using Excel QM
PROGRAM 9.8 –
Lauderdale
Construction
Minimal-Spanning
Tree Example

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