Logistics

Transportation and Assignment Problems

 Transportation Problem: Example
Rapid City
demand = 400

Chicago
Eugene
supply = 500
demand = 300 Salt Lake City
supply = 400

Product is to be shipped from 2

factories to 3 distribution centers.
Each route factory –> DC has a
corresponding per unit shipping
Sacramento
cost.
demand = 200
The goal is to minimize the total
shipping cost.
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 Transportation Problem: Example

Distribution Centers

Factories Sacramento Rapid City Eugene (D3) Supply

( D1) (D2)
Salt Lake
5.0 6.0 5.4 400
City (S1) x11 x12 x13

Chicago 7.0 4.6 6.6

(S2) x21 x22 x23 500

Demand 200 400 300

Formulate the transportation problem for the

example
Badania Operacyjne 3
 Transportation Problem: Example
xij the quantity shipped from factory i to distribution center j
1 i 2, 1  j 3.

min Z  5x11  6 x12  5.4 x13 

 7 x21  4.6 x22  6.6 x23 .

S1 x11  x12  x13 400 The sum of shipments from Si =

supply available at Si.
S2  x21  x22  x23 500
D1 x11  x21 200
D2  x12  x22 400 The total quantity delivered to Dj =
quantity demanded at Dj.
D3 x13  x23 300
xij 0 Badania Operacyjne 4
 Transportation Problem
 The transportation problem is to ship a product from a
group of sources of supply (supply centers, sources) to a group
of sources of demand (receiving centers, destinations) in a way
as to minimize the total shipping cost.

 The information needed to formulate the problem:

 The list of sources of supply (i = 1,…,m) along with
supply quantities si.
 The list of sources of demand (j = 1,…,n) along with
demand quantities dj.
 The unit shipping costs (cij) for the supply sources i
and the demand sources j.

 Decision variables (xij): the number of units to be

shipped from the source of supply i to the source of
demand j. Badania Operacyjne 5
 The Transportation Problem: Assumptions

 The requirements assumption.

Each source of supply has a fixed supply si, where this
entire supply must be shipped out to the sources of
demand.
Each source of demand has a fixed demand d j, where this
entire demand must be received from the sources of
supply.

 The above requirement implies there must exist a balance

between the total supply from all sources of supply and the
total demand at all sources of demand:
Total supply = total demand.
Note: if the above condition does not hold, the
transportation problem does not have feasible solutions.
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 The Transportation Problem: Assumptions

 Costs.
The cost of shipping units from any particular source of
supply to any particular source of demand is directly
proportional to the number of units shipped. Therefore,
this cost is the unit cost times the number of units
shipped.

 Optimization criterion.
The goal is to minimize the total shipping cost between
the sources of demand and the sources of supply.

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 Parameter Table

Demand source
Supply D1 D2 D3 Supply
source
S1 c11 c12 c13
s1
The number of x11 x12 x13
sources of
supply = the S2 c21 c22 c23
number of rows
x21 x22 x23 s2
=m

Demand d1 d2 d3
The number of
sources of demand =
the number of
columns = n

Quiz: How many decision variables are needed for a transportation

problem with m sources of supply and n sources of demand?
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 A Network Model

Supply Source Demand Source

c11 x11
[s1] S1 D1 [d1]
c12
x21
x12
c13

x13 D2 [d2]
c21
x22

c22
x23
[s2] S2 c23 D3 [d3]

ci j = the unit shipping cost from supply source i to demand source j

s i = the supply quantity in supply source i
d j = the demand quantity in demand source j
xi j = the shipment quantity from supply source i to demand source j
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 Mathematical Model
xij the shipment size between the source of supply i
and the source of demand j, i 1,..., m, j 1,..., n

m n
Min Z   cij xij total shipping cost 
i 1 j 1

subject to
n
Total quantity
x
j 1
ij si for i  1,..., m available si must be
shipped out.
m

x
i 1
ij d j for j  1,..., n
Total demand dj must
be received.
and xij 0.
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 Important Properties

 The integer solutions property:

For a transportation problem, where all si oraz dj are
integer, an optimal solution (the xijs) is also integer.
Thus, adding a constraint “all xij assume only integer
values“ is not needed.

 The number of non-zero values in an optimal solution:

The number of non-zero xijs does not exceed m + n – 1.

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 Table (Matrix) of Coefficients
S1 x11  x12  x13 400
S2  x21  x22  x23 500
D1 x11  x21 200
D2  x12  x22 400
x11 x12 x13 x21 x22 x23 D3 x13  x23 300

1 1 1 Supply
constraints
1 1 1
(factories)
A 1 1
= Demand
1 1 constraints
(distribution
1 1 centers)

In the transportation problem, the matrix of coefficients in Ax = b has

a characteristic form.
Quiz: How many constraints “=“ does the transportation problem with
m sources of supply and n sources of demand have?
Badania Operacyjne 12
 Excel Solver: The Transportation Problem

POPYT=

Transportation Problem.xls

The Simplex Method available in Excel Solver can be applied to solve

the transportation problem.
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 Transportation Problem: Modifications
 Total supply is greater than total demand: here, si is a
maximum quantity (rather than fixed quantity) to be
distributed.

 Total demand is greater than total supply: here, dj is a

maximum quantity (rather than fixed quantity) to be received.

 A source of demand has both minimum and maximum level of

demand: any shipment size between min and max is
acceptable.

 Certain routes: source of supply –> source of demand are not

permitted.

 The goal is to maximize total profits from shipping products

rather than to minimize total shipping costs.
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The Assignment Problem: Example

Four project managers are to be

assigned to four projects.

Each project manager is to be

assigned to exactly one project.

Each project has to managed by

exactly one project manager.

The project duration depends on

which manager is assigned to the
project.

The objective is to minimize the

total time required to complete
the projects.
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 The Assignment Problem: Example

The project durations (in weeks)

P1 P2 P3 P4

Amy 8 6 2 4

Ben 6 7 11 10

Chris 3 5 7 6

Don 5 10 12 9

Formulate the assignment problem for the example

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 The Assignment Problem: Example

1, if manager i is assigned to project j,

xij 
0, if manager i is not assigned to project j.
1 i 4, 1  j 4.

1 2 3 4 1 2 3 4

A x11 x12 x13 x14 A 1 0 0 0

B x21 x22 x23 x24 B 0 0 1 0

C x31 x32 x33 x34 C 0 1 0 0

D x41 x42 x43 x44 D 0 0 0 1

decision variables an example of the assignment

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 The Assignment Problem: Example
min Z  8 x11  6 x12  2 x13  4 x14 
 6x21  7 x22  11x23 10 x24 
 3x31  5 x32  7 x33  6 x34 
 5x41  10 x42  12 x43  9 x44 .

Each manager is to be assigned Each project is to be managed

to exactly one project by exactly one project
manager
A  x11  x12  x13  x14 1 P1 x11  x21  x31  x41 1
B  x21  x22  x23  x24 1 P2  x12  x22  x32  x42 1
C  x31  x32  x33  x34 1 P3 x13  x23  x33  x43 1
D  x41  x42  x43  x44 1 P4  x14  x24  x34  x44 1
xij 0  xij binary 
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 The Assignment Problem

 The goal of the assignment problem is to assign a group

of assignees to the group of tasks in a way that minimizes
the total cost (time) of performing the group of tasks.

 The information needed to formulate the problem:

 The list of assignees (i = 1,…,n).
 The list of tasks (j = 1,…,n).
 The cost cij associated with assignee i performing task j.

 The decision variables (xij): the assignment of assignee i

to task j: 1 if yes, 0 is not.
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 Assumptions

 The number of assignees and the number of tasks are

the same (n).

 Each assignee is to be assigned to exactly one task.

 Each task is to be performed by exactly one assignee.

 The objective is to determine how the optimal

assignment should be made to minimize the total cost.

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 The Assignment Problem
1, if assignee i performs task j,
xij 
0, if not

n n
Min Z   cij xij
i 1 j 1

subject to
n
Each assignee is to be
x
j 1
ij 1 for i  1,..., n assigned to exactly one
task.
n

x
i 1
ij 1 for j  1,..., n
Each task is to be
performed by exactly one
assignee.
xij 0  xij binary 
Badania Operacyjne 21
 A Network Model

assignees tasks
c11 x11 t1
a1
c12
x31
x12
c13

a2 t2
x13
c31
x32

c32
x33
a3 t3
c33

ci j = a cost incurred when person i performs task j

xi j = decision variable = 0 or 1

Badania Operacyjne 22
 Important Properties

 The assignment problem is a special type of the

transportation problem, where the sources are assignees
and the destinations are tasks and where
the number of sources = the number of destinations = n,
each supply sj = 1 and each demand dj = 1.

 The integer solution property of the transportation

problem, along with constraints si = 1, dj = 1, and xij >=
0, lead to the conclusion that the optimal solutions to the
assignment problem xij must be restricted to 0 and 1.
It follows that constraints <xij is binary> is not required
in the formulation of the linear program.
Badania Operacyjne 23
 Excel Solver: The Assignment Problem

Assignment Problem.xls

The Simplex Method available in Excel Solver can be applied to solve

the assignment problem.
Badania Operacyjne 24