CHAPTER V

DISTRIBUTION MODELS

One important application of linear programming has been in the area of the
physical distribution (transportation) of resources, from one place to another, to
meet a specific set of requirement.

This chapter describes two special –purpose algorithms: the transportation

model and the assignment model. Model formulation and manual solution are
covered for each of these classes of problems.

Both transportation and assignment problems are members of a category of

linear programming techniques called network flow problems.

5.1. TRANSPORTATION PROBLEMS

Transportation problem deals with the distribution of goods from several points
of supplies (sources) to a number of points of demands (destinations).

Consider a corporation engaged in the manufacture of products. Most of such

big corporations are of “multiple-product” and “multi-unit” organizations
having production units situated at different places. Items are produced for sales.
Sales take place at different markets which are, again located at different places.
It is not feasible to co-locate production and market. Markets are located away
from the manufacturing places. Hence products are sent to factory warehouses
set up near market outlets. Cost of product consists of production cost and
distribution cost.

Cost of product = production cost + distribution cost

Distribution cost consists of mainly the transportation cost of items from its
production (manufacturing) center to the warehouses. Transportation techniques
are designed to minimize the distribution costs. In order to identify products, it is
necessary to workout per unit distribution cost of each product. We also know
the production capacity of each product in each factory is not fixed. The holding

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capacity of a warehouse or potential sales in each marketing center is again a
fixed quality which cannot be exceeded.

The characteristics of transportation problem are as follows:

1. A limited supply of one commodity is available at certain sources or origins.
2. There is a demand for the commodity at several destinations
3. The quantities of supply at each source and the demand at each destination are
constant.
4. The shipping or transportation costs per unit from each source to each destination are
assumed to be constant.
5. No shipments are allowed between sources or between destinations. All supply and
demand quantities are given in whole number or integers.
6. The problem is to determine how many units shipped from each source to each
destination so that all demands are satisfied at the minimum total shipping costs.

 Uses of transportation techniques:

1. Reduce distribution or transportation cost
2. Improve competitiveness of product
3. Assist proper location of warehouses
3. Assist proper location of new factories or plants being planned.
4. Close down warehouses which are found costly and uneconomical.

 The objective of transportation problem is:

1. To identify the optimal shipping routes-minimum cost route
2. To identify the maximum amount that can be shipped over the optimum route
3. To determine the total transformation cost or the profit of transportation

5.1.1. The Transportation Method
The solution algorithm to a transportation problem may be summarized into the
following steps:

Step 1:
Formulate the problem and set up in the matrix form

2
The formulation of the problem is similar to the linear programming. Here the
objective function is the total transportation cost and the constraints are the
supply and demand available at each source and destination respectively.

Step 2:
Obtain an initial basic feasible solution
There are 3 methods to find the initial feasible solution.
1. North-West Corner Method (NWCM)
2. Least Cost Method (LCM)
3. Vogel’s Approximation Method (VAM)
The initial solution obtained by any of the three methods must satisfy the
following condition:

i. The solution must be feasible

It must satisfy all the supply and demand constraints
ii. The number of positive allocations must equal to m+n-1, where m=the
number of rows (or origins or supply centers) and n= the number of
columns(or destination centers or demand centers)

Example:
m=3 origins and n=4 destinations ==>m+n-1=3+4 -1=6 (i.e. the transportation
model should have 6 occupied cells).

Note:
If the number of occupied cells < m+n-1==> degenerate solution will result in.

Step 3. Test the initial solution for optimality

Testing for optimality can be made using three approaches:
i. Stepping stone approach
ii. Modified distribution method
If the current solution is optimal, then stop. Otherwise, determine the new
improved solution.

Step 4 Repeat step 3 until an optimal solution is reached

3
5.1.2. Linear programming formulation of the transportation problem

Example
Suppose that a firm has three factories /sources of supply/ & four warehouses
/point of demand/. The firm's production capacity at the three factories, the
demand for the four distribution centers located at various regions & the cost of
shipping each unit from the factories to the warehouses through each route is
given as follows:
Destinations (dd) =j

Factory
Origin
W1 W2 W3 W4 Capacity
(Supply)
=i
Br.
F1 3 2 7 6 5000

7 5 2 6000
F2
3
F3 2 5 4 5 2500
Requirements of
the
Warehouses 6000 4000 2000 1500 13500
( Units of
demand)

Using all the above information

i. Express the following transportation problem as an LPP
Solution
Let xij =The amount of commodity to be transported form source i (i =1,2,3) to
destination j( j= 1,2,3,4).
Then the objective function of the problem (minimization of the total
transportation cost) can be formulated as:
MinZ = 3x11 +2x12 + 7x13 +6 x14 +
7x21 +5x22 +2x23 + 3x24 +
2x31+5x32 +4x33+5x34
Subject to the constraints
a. Supply constraints:
x11 +x12 +x13 +x 14 =5000 F1 supply constraint

4
 x21 + x22 + x23 +x24 =6000 F2 supply constraint
x31 +x32 +x33+x34 = 2500 F3 supply constraint
b. Demand constraints:
x11 + x21 + x31 = 6000 W1 demand constraint
x12 + x22 + x32 = 4000 W2 demand constraint
x13 + x23 +x33 = 2000 W3 demand constraint
x14 +x24 + x34 = 1500 W4 demand constraint
xij > 0 for all i& j
In the above LPP, there are m x n = 3x4 =12 decision variables & m + n = 3+4 =7
constraints. Thus, if this problem is solved by the simplex method, then it may
take considerable computational time.
ii. The network representation of the transportation LPP is called Net work flow
Origin Destination centers
(Sources of Supply) (Point of demand centers)

F1 50000 3 W1 6000
2
6 7
7

F2 6000 5 W2 4000
2
3
W3 2000
2 5
4
F3 2500 5 W4 1500

This LPP has 12 shipping routes. The objective is to identify the minimum cost
route (Least cost route).

5.2. METHODS OF FINDING INITIAL FEASIBLE SOLUTION

There are several methods available to obtain an initial feasible solution. Here we
shall discuss only three different methods to obtain the initial feasible solution:

A. NORTH- WEST CORNER METHOD (NWCM)

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 This method does not take into account the cost of transportation on any route
of transportation.

The NWCM gets its name because the starting point for the allocation process is
the Upper Left-hand (Northwest) corner of the transportation table. Therefore,
allocate to the Northwest corner as many units as possible.

Northwest corner rule

The following set of principles guides the allocation:

1. Begin with the upper left hand cell (Left, upper most in the table), & allocate as
many units as possible to that cell. This will be the smaller amount of either
the row supply or the column demand. Adjust the row & column quantities to
reflect the allocation.
2. Subtract from the row supply & from the column demand the amount
allocated
3. If the column demand is now zero, move to the cell next to the right, if the row
supply is zero, move down to the cell in the next row.
If both are zero, move first to the next cell on the right then down one cell.
4. Once a cell is identified as per step (3), it becomes a northwest cell. Allocate to
it an amount as per step (1)
5. Repeat, the above steps (1) - (4) until all the remaining supply and demand is
gone.
Example:
1) Consider the following transportation problem:

Store Store Store Store

Supply
1
To 2 3 4
From
Plant 1 19 30 50 10
7
70 30 40 60 9
Plant 2

Plant 3 40 8 70 20 18

8 7 14 34
Demand 5
a. Develop an initial feasible solution using the NWCM
b. Compute the total cost for this solution.

6
Solution
a. Table: Initial feasible solution
To
Store 1 Store 2 Store 3 Store 4 Supply
From

Plant 1 19 30 50 10
7
5 2
70 30 40 60
Plant 2 9
6 3
40 8 70 20
Plant 3 18
4 14
8 7 14 34
Demand 5

Check that the solution is feasible or not:

==>m + n-1; m=3 and n=4  3+4-1= 6 cells occupied (Feasible solution)
The total transportation cost of the initial feasible solution derived by the NWCM
is:
Route Unit Per unit Total
From To Shipped X cost ( $) = Cost ( $)
Plant 1 Store 1 5 19 95
plant 1 Store 2 2 30 60
Plant 2 Store 3 6 30 180
Plant 2 Store 4 3 40 120
Plant 3 Store 4 4 70 280
Plant 3 Store 4 14 20 280
Total Cost= $ 1015

Note: NWCM does not consider the cost factor for allocation.

Exercise:
1. Determine an initial basic feasible solution to the following transportation
problem using NWCM. Compute the total cost for this solution

Destination
A B C Supply
S1 2 7 14 5

7
 S2 3 3 1 8

S3 5 4 7 7
S4 1 6 2 14
Demand 7 9 18

Answer: X11=5, X21=2, X22=6, X32=3, X33=4, X43=4, and Total cost =$102

Note:
1. Total Supply= Total demand ===> Balanced TP
2. Total Supply ≠ total demand ===> Unbalanced TP
3. Convert the unbalanced TP into a balanced TP by using dummy
destination/dummy source.
* If total Supply > Total demand, then create a fictitious or artificial
destination called dummy destination
i.e: total Supply > Total demand===> Add dummy column
* Excess demand (Supply < demand)
- Add a dummy source
- Add a dummy row
Note: the cost of “shipments” to the dummy is usually set at zero ==> No real
cost
Example
Develop an initial feasible solution using NWCM

Table: Unbalanced transportation table

R S T Supply
A 1 2 3 100
B 4 1 5 110

Demand 80 120 60 210

260

Solution:
R S T Supply
1 2 3
A 100
80 20

8
 4 1 5
B 110
100 10
0 0 0
Dummy 50
50
Demand 80 120 60 260

Answer:X11=80, X12=20, X22=100, X23=10, X33=50 Total cost =$270

Assignment
Consider that Harley's Sand & Gravel Pit has contracted to provide topsoil for
three residential housing developments. Topsoil can be supplied form three
different “farms" as follows:
_________________________________________________________________
Weekly Capacity
Farm (Cubic Yards)
A 100
B 200
C 200
_________________________________________________________________

Demand for the topsoil generated by the construction projects is:

_____________________________________________________________
Weekly Demand
Project (Cubic Yards)
1 50
2 150
3 300
_________________________________________________________________
The manager of the sand & gravel pit has estimated the cost per cubic yard to
ship over each of the possible routes:
_________________________________________________________________
Costs per cubic yard to
From Project # 1 Project #2 Project #3
Farm A $4 $2 $8
Farm B 5 1 9

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 Farm C 7 6 3

_________________________________________________________________
Required
Develop the initial feasible solution using NWCM & compute the total cost for
this solution.

B. THE LEAST- COST METHOD (LCM) or

(LARGEST- PROFIT) METHOD
LCM is the method used a minimum cost in the allocation.
It begins a solution by sequentially assigning to the ratios or cells with the
minimum cost as many units as possible. The first allocation be made to the cell
with the lowest cost (the highest profit in a maximization case)

The Least- Cost Method yields not only an initial feasible solution but also one
that is close to optimal in small problems.
Example
1.Suppose that a firm has three factories / sources of supply /& four
warehouses/point of demand/ .The firm's production capacity at the three
factories, the demand for the four destination centers located at various regions
& the cost of shipping each unit from the factories to the warehouses through
each route is given as follows:
Destinations
Factory
W1 W2 W3 W4 Capacity
F1 3 2 7 6 5000
F2 7 5 2 3 6000
F3 2 5 4 5 2500
Demand 6000 4000 2000 1500 13500
Required:
a. Develop an initial feasible solution using NWCM & Compute the total cost
b. Develop an initial feasible solution using least-cost method & compute the
total cost.
Solution:
Initial feasible solution

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 Factory
W1 W2 W3 W4 Capacity
F1 3 2 7 6
5000
Factory 5000
F2 7 5 2 3 6000
1000 4000 1000
2 5 4 5
F3 2500
1000 1500
Demand 6000 4000 2000 1500 13500

m= 3, n =4 ==> 3+4 -1 =6 occupied cells (Feasible)

Routes Units Unit Total
From To Shipped X Cost =Cost
F1 W1 5000 3 $ 15000
F2 W1 1000 7 7000
F2 W2 4000 5 20000
F2 W3 1000 2 2000
F3 W3 1000 4 4000
F3 W4 1500 5 7500
Total transportation cost =$55,500

b.
Factory
W1 W2 W3 W4 Capacity
3 2 7 6
F1 5000
1000 4000
F2 7 5 2 3
6000
2500 2000 1500
2 5 4 5
F3 2500
2500
Demand 6000 4000 2000 1500 13500

Routes Units Unit Total

From To Shipped X Cost =Cost
F1 W1 1000 3 $ 3000
F1 W2 4000 2 8000
F2 W1 2500 7 17500
F2 W3 2000 2 4000
F2 W4 1500 3 45000

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 F3 W1 2500 2 5000
Total transportation cost =$42,000

m= 3, n=4 ==> 3+4-1 =6 occupied calls (Feasible)

Least- Cost method is better than the NWCM because it considers cost factories.
2. Develop the initial feasible solution for the following TP using the least-cost
method (LCM)
D E F G Supply
Source
A Destination 1 5 3 4 100
B 4 2 2 5 60
C 3 1 2 4 120
demand 70 50 100 60 280

Solution
The 1st allocation should be made to the cell with the least-cost. Cells AD & CD
both have the lowest cost f $1. Cell AD is selected 1 st because more units can be
allocated to it (70) than to cell CE (50).

Cell CF is filled in 1st since a larger quantity (120-50-70) can be placed there.
Then, the remaining requirement of 30 for column F is allocated to cell BF &
source B's supply is reduced to 30.
The initial solution by the least -cost method
D E F G Supply
Source
A Destination 1 5 3 4 100
70
B 4 2 2 5 60
30 30
C 3 1 2 4 120
50 70

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 deman
70 50 100 60 280
d
Routes Units Unit Total
From To Shipped Cost =Cost
A D X 1 $ 70
B F 70 2 60
B G 30 5 150
C E 30 1 50
C F 50 2 140
70 Total transportation =$470
cost

m=3, n=4 ==> 3+4-1 = 6 occupied cells (feasible)

3. Develop an initial feasible solution using LCM

R S T Supply
A 1 2 3 100
B 4 1 5 110
Demand 80 120 60

Solution

R S T Supply
A 1 2 3 100
80 10 10
B 4 1 5 110
110
Dummy 0 0 0 50
50
Demand 80 120 60

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Total transportation cost=80x1+10x2+10x3+110x1+50x0=$240
Exercise
Three garment plants are available for monthly education of four styles of men's
shirts. The capacities of the three plants are 45,000, 93,000 and 60,000 shirts. The
number of shirts required in style "a" through "d" are 28,000, 65,000, 35,000 &
70,000, respectively. The profits, in $ per shirt, at each plant for each style are
shown below.
Table: The garment plants' profit.
STYLE a b c d
PLANT
1 8 12 -2 6
2 13 4 3 10
3 0 7 11 8
How many shirts of each type to produce in each plant so that profit is
maximized?
Answers: Total profit= $2,119,000
(Hint: Select the largest per unit profit, first & use largest-profit method)

2. Determine an initial feasible solution to the following transportation problem

using LCM

A B C D Supply
S1 1 5 3 3 34

Source
S2 3 3 1 2 15
S3 0 2 2 4 12
C.
S4 2 7 2 4 19
demand 21 25 17 17
VOGEL'S APPROXIMATION METHOD (VAM)
or
PENALTY METHOD
VAM is preferred to the other two methods described above. In this method each
allocation is made on the basis of the opportunity (or penalty or extra) cost that
would have incurred if allocation in certain cells with minimum unit
transportation cost were missed.

14
In this method allocation are made so that the penalty cost is minimized. The
advantage of this method is that it gives an initial solution which is nearer to an
optimal solution or is the optimal solution itself.

VAM determines the penalty for not using the minimum cost routes, where the
objective is to avoid large penalties so that the penalty from not using the routes
is minimized.

The steps in VAM are as follows:

1. Calculate penalties for each row (column) by taking the smallest & the next
smallest unit transportation cost in the same row (column). This difference
indicates the penalty or extra cost which has to be paid if one fails to allocate
to the cell with the minimum unit transportation cost
2. Select the row or column with the largest penalty & allocate as much unit as
possible in the cell having the least cost in the selected row or column
satisfying the conditions. If there is a tie in the values of penalties, it can be
broken by selecting the cell where maximum allocation can be made.
3. Adjust the supply & demand & cross out the satisfied row or column
If a row or column is satisfied simultaneously, only one of them is crossed out
& the remaining row (column) is assigned a zero supply (demand) .Any row
or column with zero supply or demand should not be used in computing
future penalties.
4. Repeat step 1 to 3 until the entire available supply at various sources &
demand at various destinations are satisfied.

Example:
1. Determine an initial basic feasible solution to the following transportation
problem using VAM.
Warehouse
Row difference or Row penalty
A B C D Supply or opportunity cost

Factory F1 2 2 0 4
25 2 0 - - -
5 20
F2 5 9 8 3 2 2 2 2 5
25
15 5 5
1 2 2 - -

15
 F3 6 4 3 2
10
10
Demand 20 15 20 5 60

Column difference 3 2 3 1
or Column penalty
or opportunity cost 3 2 - 1

1 5 - 1

5 9 - -

5 - - -
m= 3, n=4 ==> 3+4-1 =6 Occupied cells (feasible)
The transportation cost associated with this solution is:
Total cost= 5x2 + 20x0+15x5x9 =+95x3+10x4= $185

2. A dairy firm has three plants located in different regions. The daily milk
production at each plant is as follows:
Plant 1: 6 million liters.
Plant 2: 1 million liters, &
Plant 3: 10 million liters
Each day the firm must fulfill the needs of its four distribution centers.
Minimum requirement at each center is as follows.
Distribution center 1: 7 million liters
" " 2: 5 " "
" " 3: 3 " "
" " 4: 2 " "

Cost of shipping one million liters form each plant to each distribution center
is given in the following table in hundreds of dollar.

Distribution Center
D1 D2 D3 D4
P1 2 3 11 7
Plant
P2 1 0 6 1
Find P3 5 8 15 9 the initial basic feasible
solution by:
a. North-west corners method

16
 b. LCM
c. VAM if the object is to minimize the total transportation cost
Answer:
a. Total cost = $11, 600
b. Total cost= $11,200
c.
D1 D2 D3 D4 Supply Row Penalty
P1 2 3 11 7 6 1 1 5 -
P2 1 0 6 1 1 1 - - -
P3 5 8 15 9 10 3 3 4 4
Demand 7 5 3 2
Column Penalty
7 5 3 2
1 3 5 6
3 5 4 2
3 - 4 2
5 - 15 9

m+n -1 +3+4-1 =6 ==>the solution is non-degenerate.

The total transportation cost=$(1x2+5x3+1x1+6x5+3x15+1x9) x100 = $ 10,200

Assignment
1. Determine an initial basic feasible solution to the following transportation
problem by VAM
Destination
D1 D2 D3 D4 Supply
S1 21 16 15 3 11
Source S2 17 18 14 13 13
S3 32 27 18 41 19
Demand 6 10 12 15

2. Determine an initial feasible solution to the following transportation problem

using

17
 a. NWCM
b. LCM, &
c. VAM
Destination
D1 D2 D3 D4 Supply
A 11 13 17 14 250
Source B 16 18 14 10 300
C 21 24 13 10 400
Demand 200 225 275 250

5.3. OPTIMALITY TESTS

Once an initial solution is available, the next step is to check its optimality. An
optimal solution is one in which there is no opportunity cost. That is, there is no
other set of transportation routes (allocations) that will reduce the total
opportunity cost. Thus we have to evaluate each unoccupied cell (represents
unused route) in the transportation table in terms of opportunity cost.

The purpose of the optimality test is to see if the proposed solution just
generated can be improved or not. The solution to be checked for optimality
must be non-degenerate i.e the no of occupied cells must be m+n-1.

The Procedure for testing optimality is analogous to that of the simplex method.
A distinction is made between basic variables, those associated with occupied
cells & non-basic variables, those associated with the empty cells.

For each empty cell, the effect of changing it to an occupied cell is examined. If
any of these changes are favorable, the solution is not optimal & a new solution
must be designed. A favorable change means an increase in the value of the
objective function in maximization problems or a decrease in minimization
problems.

Optimum solution to a TP can be obtained by following two methods. These

methods are much simpler compared to simplex method of an LPP.

18
 A. Stepping stone Method
B. Modified Distribution method (MODI Method)
A. Stepping-stone method
The Stepping-stone method is an iterative technique for moving from an initial
feasible solution to an optimal solution in transportation problems.

For the stopping- stone method to be applied to a transportation problem, one

rule about the no of shipping routes being used must be observed. The rule is:

“The No of occupied routes (or squares) must always be equal to one less than
the sum of the no of rows plus the no of columns."

i.e Occupied shipping routes ( squares) = N o of rows + No of columns - Non

degenerate solution.

Rules for drawing each closed loop:

1. Select an unused square (cell) to be evaluates.
2.Beginning at that cell, trace a closed loop going clockwise draw an arrow to an
occupied cell in the same row ( or column).
3. Move vertically or horizontally (but never diagonally) to another occupied cell
“stepping –over” unoccupied or occupied cells (if necessary) without changing them.
Follow the same procedure to other occupied cells until returning to the original empty
cell.
4. Begin with a plus (+) sign at the unused cell, place alternative (-) signs and plus signs
on each corner square of the closed path just traced.
i.e At each turn of the loop ( the loop may cross over itself at times), plus and
minus signs are alternately placed in the cells, starting with a + sign in an empty cell.
5. There must be exactly one cell with a + sign and exactly one cell with a - sign in
any row or column in which the loop turns.
6. An even no of at least four cells must participate in a loop and the occupied cells
can be visited once and only once.
7. Repeat steps 1 to 4 until an improvement index has been calculated for all unused
squares (cells). If all indices computed are greater than or equal to zero, an optimal

19
 solution has been reached (for minimization problems). If not, it is possible to improve
the current solution and decrease total shipping costs.

Note:
In a non-degenerate problem, there is only one possible way of drawing the loop
for each empty cell.
How to find the value of a cell evaluator
The value of a cell evaluator is the sum of the per unit shipping costs in the
gaining cells less the sum of the per unit shipping costs in the losing cells of the
closed loop. This evaluation process must be extended to all unoccupied cells.

1. The test of optimality for a minimization (cost) problem:

If one or more of the cell evaluators is negative, the existing solution is not
optimal.
i.e.: For minimization (cost) problems, all the cell evaluators must be positive
for optimality.

 Analysis of test:
Check all the empty cells and select for improvement the one with the
largest improvement potential.
 If the solution is not optimal, the next step in the transportation method
is to find a better solution. The operations in this step are:
a. Identify the “incoming" cell (the empty cell to be occupied)
In a minimization case, the incoming cell is located by identifying
the most negative cell evaluator.
b. Design an improved solution
-By shifting units form cell to cell
2. The test of optimality for a maximization (profit) case:
: Is the reversed of minimization case
-If one or more of the cell evaluators is positive, the existing solution is
not optimal.

20
 i.e: for a maximization (profit) case, all the cell evaluators must be
negative for optimality. If any cell evaluation is positive, the solution is not
optimal.
Note:
 A cell evaluator of 0 indicates the existence of another solution just as
good as the current solution. Thus, in the final solution, if cell evaluators
of 0 exist, this indicates the existence of multiple optimal solutions.
 If two or more cells have the same value, then either may be selected.
 If two or more of the "losing" cells contain the same no of units, both will
become empty simultaneously and a “degenerate" solution will result.
 For the minimization case; when one or more cell evaluators are negatives,
the cell with the largest negative should be brought into solution because
that route has the largest potential for improvement per unit.
 The loop starts and ends at the selected unoccupied cell. Every corner
element of the loop must be an occupied cell.

Example:
1. Use NWCM to find initial feasible solution and test the solution for optimality.
Project Project Project ss
A B C
F1 4 2 8 100
Farm

F2 5 1 9 200
F3 7 6 3 200
dd 50 150 300 500

Solution
Project Project Project ss Initial feasible solution
A B C
F1 4 2 8 100
50 50
F2 5 1 9 200
100 100
F3 7 6 3 200 21
200
dd 50 150 300 500
m=3, n=3==> 3+3-1=5(Non-degenerate solution)
Total transportation cost = $[50x4+50x2+100x1+100x9+200x3] = $1900

Project Project Project ss

A B C
F1 4 2 8 100
50 50 - + Evaluation path for the
F2 5 1 9 200 unoccupied cells
100 + 100-
F3 7 6 3 200
200
Dd 50 150 300 500
Table: Test of optimality
Unoccupied cells Cell evaluators
(F2 ,A) +5-4+2-1=+2
(F1 ,C) +8-9+1-2=-2
(F3 ,A) +7-4+2-1+9-3=+10
(F3 ,B) +6-1+9-3=+11

The negative value for cell (F1, C) indicates an improved solution is possible. For
each unit we can shift into that cell, the total cost will decrease by $2. The next
question is how many units can be reallocated into that cell while retaining the

22
balance of supply and demand for that table?

The Stepping- stone path for cell (F1, C) is:

The + Signs in the path indicate units to be added, the - signs indicate units to be
subtracted. The limit on subtraction is the smallest quantity in a negative
position along the cell path. There are two quantities in negative positions, 50
and 100. Because 50 is the smaller quantity, that amount will be shifted in the
following manner: Subtract 50 units from each cell on the path with a - sign and
add 50 units to the quantity of each cell with a + sign in it.

With each iteration (new solution), it is necessary to evaluate the empty cells to
see if further improvements is possible.

The distribution plan after reallocation of 50 units is:

A B C Ss
F1 4 2 8 100

F2 50 5 1 50 9 200

150 50
F3 7 6 200
3
dd 50 150 300 500

Table: Test of optimality

Unoccupied cells Cell evaluators
(F1 ,B) +2 -8+9-1 =+2

23
 (F2 ,A) +5 -4+8-9 =0

(F3 ,A) +7-4+8-3 =+8

(F3 ,A) +6-1+9-3= +11

Because none of these no is negative, this is an optimal solution. Therefore, the

total cost for the distribution plan is:
The total transportation cost = $ (50x4 +50x8 150x1+50x9 +200x3) = $1,800

2. Consider the following TP

Destination
R S T Ss
A 1 2 3 100
B 4 1 5 110
Origin

21
dd 80 120 60 0
260
a. Obtain the basic feasible solution using VAM
b. Obtain the optimal solution
c. What is the optimal shipping cost?
Solution:
a. Initial feasible solution
To
R S T ss Opportunity cost
1 2 3 100
A 1 1 1 1
80 10 10
From

3 3 - -
B 4 1 5 110
0 - - -
Dummy 0 1100 0 50
dd 80 120 60 260
Opportunity 1 1 3
3 1 2
cost 1 2 3
1 2 -

24
Note: Include the dummy cells to select the opportunity cost under VAM
problems.

b. Test of optimality.
Table: Test of optimality

Unoccupied cells Cell evaluators

+4-1+2-1= +4
(B,R)
+5-1+2-3= +3
(B,T)
+0-1+3-0= +2
(D,R)
+0-2+3-0= +1
(D,S)

Since none of the cell evaluators is negative, the above feasible solution is
optimal.
Thus, accordingly the distribution is as follows
A Supplies 80 units to warehouse R
B Supplies 10 units to warehouse S
C Supplies 10 units to warehouse T
B Supplies 110 units to warehouse S

c. The total optimal shipping cost is = $240

Exercise:
Consider the following transportation problem

Store Store Store

Supply
1 2 3
A 12 20 15 50
es
warehous

B 9 11 4 15
C 20 14 8 55

25
 Dema 25 50 45 120
nd
a. Develop an initial feasible solution using the NWCM. And compute the
total cost for this solution.
b. Evaluate the solution using the stepping-stone method. Is the solution
optimal? Explain.
c. What is the total cost for the optimal solution?

B. Modified Distribution Method (MODI Method)

It is another logarithm to test the transportation solution for optimality.
The MODI method allows us to compute improvement indices quickly for each
unused cell without drawing all of the closed paths. Because of this, it can often
provide considerable time savings over the stepping-stone method for solving
transportation problems.

MODI provides a new means of finding the unused route with the largest
negative improvement index. Once the largest index is identified, we are
required to trace only one closed path. Just as with the stepping-stone approach,
this path helps to determine the maximum No of units that can be shipped via the
best unused route.

Steps in the MODI Method

The steps to evaluate unoccupied calls are as follows:
1. For an initial basic feasible solution, calculate Ui and Vj ;for rows and
columns and set
Cij = Ui + Vj for all occupied calls (i , j)
i.e: Cell cost= Raw Index +Column Index

2. For unoccupied cells, calculate opportunity cost by using the relation:

Kij = Cij– (Ui + Vj); for all j and j.

Where Kij is the cell evaluator or opportunity cost

3. Examine the sign of each Kij

For minimization case:
i. If Kij > 0, then current basic feasible solution is optimal.

26
 ii. If Kij = 0, then the current basic feasible solution will remain be
unaffected but an alternative solution exists.
iii. If one or more Kij < 0, then an improved solution be obtained
entering unoccupied cell (i, j), in the basis. An unoccupied cell
having the largest negative value of Kij is chosen for entering into
the solution mix (new transportation schedule)
4. Solve the problem as you did using the stepping-stone method.
i.e. construct a closed path (or loop) for the unoccupied cell with
largest negative opportunity cost. Start the close path with the selected
unoccupied cell and mark a plus sign (+) and in this cell, trace a path
along the rows (or columns) to an occupied cell, mark the corner with
minus sign (-) and continue down the column (or row) to an occupied
cell and mark the corner with plus sign (+) and minus sign (-)
alternatively. Close the path back to the selected unoccupied call.
Locate the smallest quantity allocated to a cell marked with a minus
sign. Allocate this value to the selected unoccupied cell and add it to
other occupied cells marked with plus signs and subtract it from the
occupied cells marked with minus signs.
5. Obtain a new improved solution by allocating units to the unoccupied
call and calculate the new transportation cost.
6. Test the revised solution for optimality.
Note:
 Any initial feasible solution will do: NWCM, VAM Solution, or any
arbitrary assignment.
 The stepping- stone method is efficient for small sized transportation
problems. For larger problems, however, the MODI method is recommended.

Example:
1. Obtain an optimal solution to the transportation problem by MODI method
given below:
Project Projec Projec Supp
N 1
o
t t ly
Farm 4 2 8 100
1
Farm 5 1 9 200
2
Farm 7 6 3 200 27
Dem
3 50 150 300 500
and
Solution
Note:
Both the MODI and the stepping - stone method will yields the same values.
Remark:
Conventionally, we begin by assigning a value of zero as the index for row 1
(U1=0). Once row index has been established, it will enable us to compute
column index numbers for all occupied cells in that row. Similarly, once a
column index number has been determined, index numbers for all rows
corresponding to occupied cells in that column can be determined.

Consider the initial feasible solution of the given example by NWCM as shown
below:
Initial solution, NWCM

Proj Proje Proje Suppl

Ui
ect ct ct y
Farm 4 2 8 100
U1=0
1 50
Farm 5 1 9 200
U2=1
2 100 100
Farm 7 6 3 200 U3=-7
3 200
Dem 150 300 500
and 50

Vj V1=4 V2=2 V3=1

To determine Cij , use the occupied cells.
For instance, C11=4, C12=2, C22=1, C23=9, and C33=3
Cij= Ui + Vj
==>C11= U1 +V1==>4=0+ V1==> V1=4 , U1=0 by convention

28
 ==>C12= U1 +V2==>2=0 +V2==> V1=2
==>C22= U2 +V2==>1= U2+ 0==> U2=-1
==>C23= U2 +V3==>9= -1+V3==> V3=10
==>C33= U3 +V3==>3= U3+10 ==> U3= -7
Note:
Cij≠ Ui + Vj (For unoccupied cells)
For instance, from the above information, C32 ≠ U3 + V2==>6≠-7+2
Table: Test of optimality
Unoccupied cells Cell evaluators
Kij = Cij– (Ui + Vj)
(1,3) C13 – (U1 +V3)=8-(0+10)= -2
(2,1) C21 – (U2 +V1)=5-(-1+4)=+2
(3,1) C31– (U3 +V1)=7-(-7+4)=10
(3,2) C32– (U3 +V2)=6-(-7+2)=+11
In this case, we found hat cell (1, 3) had an evaluation of -2, which represented an
improvement potential of and $ 2 per unit. Hence, an improved solution is
possible.
The stepping-stone path for call (1, 3) is:

Proje Projec Projec

Supply
ct t t
4 2 8 100
Farm 1
50 50
5 1 9 200
Farm 2
100 100

Farm 3 7 6 3 200
200
Dema 150 300 500
nd 50

The distribution plan after reallocation of 50 units is:

Proje Projec Projec

Supply Ui
ct t t
4 2 8 100
Farm 1 U1=0
50 50
5 1 9 200
Farm 2 - + U2=1
+ 100 100 -
7 6 3 200 U3=-5
Farm 3
200
Dema 150 300 500 29
nd 50

Vj V1=4 V2=0 V3=8

 Cij= Ui + Vj
==>C11= U1 +V1==>4=0+ V1==> V1=4 , U1=0 by convention
==>C13= U1 +V3==>8=0 +V3==> V3=8
==>C23= U2 +V3==>1= U2+ 0==> U2=1
==>C22= U2 +V2==>1= 1+V2==> V2= 0
==>C33= U3 +V3==>3= U3+8 ==> U3= -5

Table: Test of optimality

Unoccupied cells Cell evaluators
Kij = Cij– (Ui + Vj)
(1,2) C12– (U1 +V2)=2-(0+0)= 2
(2,1) C21 – (U2 +V1)=5-(1+4)=0
(3,1) C31– (U3 +V1)=7-(-5+4)=8
(3,2) C32– (U3 +V2)=6-(-5+0)=+11

Because none of the cell evaluators is negative, this is an optimal solution.

Thus, the total cost for the distribution plan =$1800

Assignment
1. Obtain an optimal solution to the transportation problem by MODI method
given below.

D1 D2 D3 Sup
D3
ply
Farm 19 30 50 10 7
1
Farm 70 30 40 60 9
2
Farm 40 8 70 20 18
3
Dem 8 7 34
and 5 14 30
2. A company has four ware houses a, b, c and d. It is required to deliver a
product from these warehouses to three customers A, B and C. The
warehouses have the following amounts in stock:

Ware house: a b c d
No of units: 15 16 12 13
And the customer’s requirements are:
Customer: A B C
No of units: 18 20 18

The table below shows the costs of transporting one unit from warehouse to
customer.

A b c d

8 9 6 3
A

6 11 5 10
B

C 3 8 7 9

Find the optimal transportation routes.

3. A manufacturer has distribution centers at X, Y and Z. These centers have
availability 40, 20, and 40 units of his product. His retail outlets at A, B, C, D
and E require 25,10,20,30 and 15 units respectively. The transportation cost (in
$) per unit between each centre outlet is given below:

Distribut Retail outlets

ion
A B C D E
X 55 30 40 50 40
35 30 10 45 60
Y
0
40 60 95 35 30
Z

31
 Determine the optimal distribution to minimize the cost of transportation.

4. A company has factories A, B and C which warehouses t D, E, F and G.

Monthly factory capacities are 160,150 and 190 units respectively. Monthly
warehouses requirements are 80, 90,110 & 160 units respectively. Unit
shipping costs (in $) are as follows:
To
D E F G
A 42 48 38 37
40 49 52 51
B

39 38 40 43
C

Determine the optima distribution for this company to minimize shipping

costs.

32
5.4. SPECIAL CASES
5.4.1. Degeneracy
A condition that occurs when the N o of occupied cells in any solutions less than
the No of rows plus the No of columns minus 1 in a transportation table.

i.e. No of occupied calls < m+ n -1 .....................Degeneracy

If the No of occupied cells = m+n-1, then the solution is non- degenerate.

The degeneracy in the transportation problems may occur at two stages:

1. when obtaining an initial solution
2. During improvement (or at any stage while moving to wards
optimal solution.
To resolve degeneracy, we processed by allocating a very small quantity close to
zero to one or more unoccupied cell so as to get m+n-1 number of occupied cells.
This amount is denoted by a Greek letter  (epsilon) or (delta). This quantity
would not affect the total cost as well as supply and demand values.
 = Almost zero
In a minimization transportation problem, allocate the smallest transportation
cost to.
In a maximization transportation problem, it should be allocated to a cell that has
a high pay off value.
Insert  when it is able to create a closed loop for each occupied cell.
The purpose of epsilon/delta is to enable evaluation of the remaining empty
cells. The choice of location for the epsilon/delta can be some what tricky: some

33
empty cells may be unsuitable if they do not enable evaluations of remaining
empty cells. Not all choices would be acceptable.

Actually, the No of epsilon/deltas needed will equal the difference between the
No of completed cells and m+n-1.Howerver; you will only be exposed to the most
common case in which one more completed cell is needed.

The epsilon/delta cannot be placed in a cell which later turns out to be in a

negative position of a cell path involved in reallocation because epsilon/delta
will be the “smallest quantity a negative position “ and shifting that minute
quantity around the cell path will leave the solution virtually unchanged.
Consequently, a certain amount of trial and error may be necessary before a
satisfactory location can be identified for epsilon/delta.

Example
1. Solve the following transportation problem.

1 2 Sup
1 3 3 ply
50
2 4 6 30
Dem
50 30 80
and
Solution:
Using NWCM and MODI, the initial solution is:

1 2 Supp Ui
ly
1 3 3 50 U1
50  =0
4 6 U2
2 30
30 =3
Dema
50 30 80
nd
V1=
Vj V2=3
3

34
 Cij= Ui + Vj
==>C11= U1 +V1==>3=0+ V1==> V1=3, U1=0 by convention
==>C12= U1 +V2==>3=0 +V2==> V2=3
==>C22= U2 +V2==>6= U2+3==> U2= 3
==>C33= U3 +V3==>3= U3+8 ==> U3= -5
Note: m=2 and n=2==>2+2-1=3==>Occupied cells=2< 3 (Degeneracy)

Table: Test of optimality

Unoccupied cell Cell evaluator
Kij = Cij– (Ui + Vj)
(2,1) C21 – (U2 +V1)=4-(3+3) =-2

The optimal solution is:

1 2 Supp Ui
Cij= Ui + Vj
ly
3 3 U1 ==>C11=U1+V1==>3=0+V1==>V1=3, U1=0 by
1 50
50 30 =0 convention
4 6 U2 ==>C21= U2+V1==>4= U2+3==> U2=3
2 30
30 =1 ==>C12= U1 +V2==>3= 0+ V2==> V2= 3
Dema
50 30 80
nd
V1=
Vj V2=3
3

Table: Test of optimality

Unoccupied cells Cell evaluators
Kij = Cij– (Ui + Vj)
(2,2) C22– (U2 +V2)=6-(1+3)= +2

The total cost= $(20x3+30x3+30x40=$270

5.4.1. Alternative Optimal solutions
The esist6ane of alternative optimal solution can be determined by an inspection
of the opportunity costs, Kij for the unoccupied cells. If an unoccupied cell in an

35
optimal solution has opportunity cost of zero, then an alternative optimal
solution can be formed with another set of allocations without increasing the
total transportation cost.

Exercise
XYZ Tobacco Company purchases tobacco and stores in warehouses located in
the following four cities.

warehouse location Capacity (Tones)

City A 90
City B 50
City C 80
city D 60

The warehouses supply tobacco to cigarette companies in three cities that have the
following demand:

Cigarette Company Demand (Tones)

L 120
P 100
Q 110

The following railroad shipping costs per tone (in hundred dollars) have been
determined:

Warehouse L p Q
location
A 7 10 5
B 12 9 4
C 7 3 11
D 9 5 7

36
Because of rail road construction, shipments are temporarily from warehouse at
city A to L Cigarette Company.
A. Find the optimum distribution for XYZ Tobacco Company.
B. Are there multiple optimum solutions? If there are alternative optimum
solutions, identify them.
5.4.3. Prohibited Transportation Routes.
The situation may arise such as road hazards (snow, foods, etc), traffic regulation
etc, when it is not possible to transport goods from certain sources to certain
destinations. In this case, the appropriate cell may either be completely crossed out
or a very large per unit transportation cost assign to it (M)

37
VI. ASSIGNMENT PROBLEMS
The Assignment Problem(AP) refers to the class of LPPs that involves
determining the most efficient assignment of people to projects, salespeople to
territories, contracts to bidders ,jobs to machines, and so on. The objective is to
assign a number of resources to an equal number of activities so as to minimize
total costs or total time or maximize total profit of allocation.

The problem of assignment arises because available resources such as men,

machines, etc have varying degrees of efficiency for performing different
activities such as job. Therefore, cost, profit or time of performing the different
activities is different.

Assumptions:
The AP is a special case of TP under the condition that the number of origins is
equal to the number of destinations. Viz. m=n .Hence assignment is made on the
basis of 1:1.

Following are the assumptions:

 Number of jobs is equal to the number of machines or persons
 Each man or machine is loaded with one and only one job.
 Each man or machine is independently capable of handling any of the jobs being
presented.
 Loading criteria must be clearly specified such as “minimizing operating time” or
“maximizing profit” ,or “minimizing production cost” or “minimizing
throughput (production cycle) time ” etc.

Remark:

38
 The AP is considered as a special TP in which the supply at each source and the
demand at each destination are always one unit.
 Since the supply and demand are always equal to one unit in each row and column,
there is no need to write them in the assignment table.

Example:
Service costs of different team assignment ($ in thousands)
Table: The assignment table
Zone
Service
Z1 Z2 Z3 Zone
Team Service
20 15 31 ====> Team Z1 Z2 Z3
S1 SS
S2 17 16 33 20 15 31 1
S1
S3 18 19 27 S2 17 16 33 1
S3 18 19 27 1
DD 1 1 1

The above problem can be presented as a LPP as follows:

MinZ = 20x11 +15x12 + 31x13 +17x21 +16x22 +33x23 +18x31+19x32 +27x33
Subject to the constraints
a. Supply constraints:
x11 +x12 +x13 =1 S1 constraint
x21 + x22 + x23 =1 S2 constraint
x31 +x32 +x33 = 1 S3 supply constraint
b. Demand constraints
x11 + x21 + x31 = 1 Z1 constraint
x12 + x22 + x32 = 1 Z2 constraint
x13 + x23 +x33 = 1 Z3 constraint
xij either 0 or 1 for all i , j
Since all xij can be either 0 or 1, there will be one assignment in each supply
constraint and one assignment in each demand constraint.

39
As in the transportation problem, assignment problems can be balanced or not.
In a balanced case, the number of objects to be assigned equals the number of
objects to which they are assigned. Unbalanced problem can be balanced by
adding a dummy (dummies) with zero cost coefficients.

5.5.1. Methods of solving assignment problems

An assignment problem can be solved by the following methods:
1. Enumeration method
2. Simplex method
3. Transportation method
4. Hungarian method

5.5.1.1. Hungarian Method/Food’s Technique/

The Hungarian Method (developed by Hungarian mathematician D.Konig) of
assignment provides us with efficient method of finding the optimal solution
without having to make a direct comparison of every solution. It works on the
principle of reducing the given cost matrix (the principle of matrix reduction) to
a matrix of opportunity costs, which means that by subtracting and adding
appropriate numbers in the cost table or matrix ,we can reduce the problem to a
matrix of opportunity costs.

Opportunity costs show the relative penalties associated with assigning resource
to an activity as opposed to making the best or least-cost assignment. If we can
reduce the cost matrix to the extent of having at least one zero in each row and
column, then it will be possible to make optimal assignments.

Steps in solving assignment problems:

Step.1. Develop the cost table from the given problem

If the number of rows does not equal the number of columns and vice versa, then
a dummy row or dummy column must be added. The assignment costs for
dummy cells are always zero.
Step 2.Find the opportunity cost table

40
The transformation of the cost matrix to what is termed as a total-opportunity
cost matrix. It involves two operations:
a. Perform row operation
I.e. locate the smallest element in each row of the given cost table
and then subtract that the given cost table and then subtract that
from each element of that row
b. Perform column operation
I.e. in the reduced matrix obtained from 2(a), locate the smallest
element in each column and then subtract that from each element
of that column. Notice that each row and column, now have at least
one zero value.
Step 3.Test for an optimal assignment
I.e. test the table resulting from step 2 to see whether an optimal assignment can
be made. The procedure is:
a. Draw the minimum number of Horizontal and /or Vertical lines necessary to
cover all zeros costs.
 Draw the lines by trial and error but always try to cover two or
more zeros with one line.
b. Count the number of the lines
 If the number of lines equals either the number of rows or columns
in the table, an optimal assignment can be made.
 If the number of lines is less than the number of rows or columns,
an improvement is possible (we proceed to step 4).
Step 4.Improve the present opportunity cost table (matrix)
This is done by the following operations:
a. Find the smallest entry in the uncovered cells (cells with no lines through them) and
subtract it from all entries in the uncovered cells.
b. Add the same smallest entry to those cells in which the lines intersect (cells with two
lines them)
c. Cells with one line through them are transferred (i.e. unchanged to the improved table).

In those problems where the first improvement does not yield an optimal
solution, we keep on improving the solution by repeating step 4 until an optimal
solution is achieved.

41
Step 5: Make an optimal assignment
An optimal assignment should be made to cells with a zero entery, maintaining
the one-to-one requirement

If more than one optimal solution exists, a trial-and –error approach can be used
to find all possible combination assignments in the zero cells.

Note that multiple optimal solutions are possible.

Example:
1. A computer center has three programmers. The center wants three application
programs to be developed. The head of the computer center, after studying
carefully the programs to be developed, estimate the computer time in minutes
required by the experts for the application programs as follows:

Programs
Programmers

(Estimated time in
1 120 minute)
100 80
2 80 90 110
3 110 140 120

Assign the programmers to the programs in such a way that the total computer
time is minimum.

Solution:
Steps 1 and 2:
a. Perform row reduction
The minimum time element in row 1, 2, and 3 is 80, 80 and 110 respectively.
Subtract those elements from all elements in there respective row.

The reduced time matrix is:

42
 Table: After row reduction
A B
-80 1 C40 20 0
-80 2 0 10 30
-110 3 0 30 10
b. Column reduction
Since column B has no one ‘0’, perform also column reduction. The minimum
time element in columns A, B and C is 0, 10 and 0 respectively. Subtract these
elements from all elements in their respective column to get the reduced time
matrix.
Table: After column reduction

1 40 A 10 B0
2 0 0 30
3 0 20 10
Step 3: Test for an optimal
assignment
a. Draw the minimum number of horizontal and /or vertical lines necessary to
cover all zero times (costs).
Table: Test of optimal assignment

1 40 A 10 B0
2 0 0 30
3 0 20 10

b. Count the number of lines

If the number of lines is equal to the number of rows/columns, the optimal
solution is obtained. Thus proceed directly to step 5.

Step 5.Make an optimal assignment

An optimal assignment should be made to cells with a zero entery, maintaining
the one-to-one requirement.
Table: optimal assignment

1 40A 10 B
2 3 30
43
0
3 1 0 010
00
Note:
In optimal assignment, start with row/column having one zero and cancel the
alternative zeros(x)

The pattern of assignment among programmers and programs with their

respective time (in minute) is given below:

Programmer Program Time (in minutes)

1 C 80
2 B 90
3 A 110
Total time=280 minutes
2. A department has five employees with five jobs to be performed .The time (in
hours) each man will take to perform each job is given in the effectiveness
matrix.
Employees

A 10 I 5 II13 IV
15 V16
B 3 9 18 13 6
Jobs

C 10 7 2 2 2
D 7 11 9 7 12

E 7 9 10 4 12

How should the jobs be allocated, one per employees, so as to minimize the total
man-hours?

Solution:
Table: After row reduction

44
 -5 A 5I 0II III
8 IV
10 V
11
-3 B 0 6 15 10 3
-2 C 8 5 0 0 0
-7 D 0 5 2 0 5

E 3 5 6 0 8
-4
Since the number of lines less than the number of rows/columns, an
improvement is possible.
Step 4. Improve the present opportunity cost table
This is done by the following operations;
a. Select the smallest entry (element) among all uncovered elements by the lines
and subtract it from all entries in the uncovered cells.
b. Add the same smallest entry to those cells in which lines intersect (cells with
two lines them).
c. Cells with one line through them are unchanged to the improved table.
Table: After improvement

A 7I 0II III
8 IV
12 V
11
B 0 4 13 10 1
C 10 5 0 2 0
D 0 2 0 0 2

E 3 3 4 0 6

Since the number of lines equals to the number of rows/columns, the solution is
optimal.
Table: Optimal assignments

45
 I II III IV V
A 7 8 12 11

0
B 4 13 10 1

C
10 5 0 0

D 00 2 2

E 3 3 4 6

The pattern of assignments among jobs and employees

0 with
0 respective time (in hours) is
given below:
Job Employees Time (in minutes)
A II 5
B I 3
C V 2
D III 9

E IV 4

Total time=23 Hours

3. A manager has prepared the following table, which shows the costs for various
combinations of job-machine assignments:
Machine
(Cost in ’000s))
1 20 A 15 B 31
Job 2 17 16 33
3 18 19 27

46
a. What is the optimal (minimum-cost) assignment for this problem?
b. What is the total cost for the optimum assignment?
Solution:
Table: After row reduction Table: After
column reduction

1 5A 0 B7
2 1 0 8
3 0 1 0

Table: After improvement

1 4A 0 B6
2 0 0 7
Table: Optimal 3 0 2 0 Assignment

A B C

1 4 6
0

2 7
0 0

Job 3 Machine 2 Cost(in $)

1 0 B 0 15000
2 A 17000
3 C 27000
Total optimal assignment=$59000

5.6. SPECIAL CASES IN THE ASSIGNMENT PROBLEMS

Certain situations can arise in which the model deviates slightly from that
previously described. Among those situations are the following:

47
A. Multiple Optimal Solutions
While making an assignment in the reduced assignment matrix, it is possible to
have two or more ways to strike off a number of zeros. Such situation indicates
multiple optimal solutions with the same optimal value of objective function. In
such cases the more suitable solution may be considered by the decision-maker.

In multiple optimal solutions, no unique 0 will exist at some point, resulting in

more than one choice for assignment and hence, more than one optimal solution.
It should be noted that all optimal solutions will yield the same value of the
objective function.

Example:
1. Given this final assignment table, identify two optimal solutions.
Machine
(Estimated time in
A 4 minute) 0 0
Job B 0 3 2
C 1 0 0
Solution
The first assignment must be B-1, because B-1 is the only 0 that appears in a
single row or column. Having made that assignment, there are two choices for
the remaining two rows, and two choices for the remaining two columns. This
results in two possible solutions, as shown:

Machine
(Estimated time in
A 4 minute)
Job B 0 3 2
C 1

2. The foreman of a machine shop wants to determine a minimum cost matching for
operators and machines. The foreman has determined hourly cost for of four operators for
the four machines, as shown in the following cost table.

48
 Machine
(Estimated cost
1 70 in80
$) 75 D
64

Operator
2 55 52 58 54
3 58 56 64 68
4 62 60 67 70
Required:
a. Determine the minimum-cost assignment for this problem
b. What is the total cost for the optimal assignment?
c. Is there an alternative optimal assignment? What is it? Calculate the total cost
for the alternate optimal assignment.
Solution:
Table: After row reduction Table: After column
reduction

1 6 A 16 B11 D
0
2 3 0 6 2
3 2 0 8 12
4 2 0 7 10

Table: Optimal Assignments

1 4 A 16 B5 D
2 1 20
3 0 20 12
4 0 0 1 10
a. Optimal Assignment b.
0 0
Operator Machine Cost(in $)
4 A 62
3 B 56
2 C 58
1 D 64
Total cost =$240

c. Yes!
Operator Machine Cost(in $)
1 D 64

49
 2 C 58
3 A 58
4 B 60
Total cost=$240
Alternative optimal assignment

B. Maximization case in assignment problems

There may arise situations when the assignment problem calls for maximization
of profit, revenue, etc as the objective function. Such problem may be solved by
converting the given maximization problem into a minimization problem by the
following procedure:

i. Find the largest profit coefficient in the entire.

ii. Subtract each entry in the original table from the largest profit coefficient.
The transformed assignment problem so obtained can be solved by using the
Hungarian method.

Example
1. A company has four territories open, and four salesmen available for an
assignment. The territories are not equally rich in their sales potential. Based on
the past performance, the following table shows the annual sales (in $) that can
be generated by each salesman in each territory. Find the optimal assignment
and the maximum expected total sales.
Salesmen

Territory
I II III IV
A 42 35 28 21
B 30 25 20 15
C 30 25 20 15
D 24 20 16 12
Solution:
Convert maximization problem into minimization problem by subtracting all
elements from the highest element (i.e 42)
Thus, the equivalent cost table is:

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 I II III IV
A 0 3 6 9
B 0 1 2 3
C 0 1 2 3
D 0 0 0 0

Thus, after improvement of the table, the optimal assignment is:

I II III IV
A 0 2 4 7
B 0 0 0 1
C 0 0 0 1
D 2 1 0 0

The pattern of two alternative optimal assignments among territories and

salesmen with respective sale is given below:

Assignment set I Assignment set II

___________________________________ _________________________________

Salesman Territory Sales($) Salesman Territory Sales($)

A I 42 A I 42
B III 20 B II 25
C II 25 C III 20
D IV 12 D IV 12
Total= $ 99 Total= $ 99
___________________________________
_________________________________

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Exercise
Five salesmen are to be assigned to five territories. Based on the past
performance, the following table shows the annual sales man in each territory.
Find the optional assignment.
T1 T2 T3 T4 T5
S1 26 14 10 12 9
S2 31 27 30 14 16
S3 15 18 16 25 30
S4 17 12 21 30 25
S5 20 19 25 16 10
C. Unbalanced Assignment problem
The Hungarian method of assignment requires that the number of columns and
rows in the assignment matrix be equal. However, when the given cost matrix is
not a square matrix, the assignment problem is called an unbalanced problem. In
such cases a dummy row(s) or column(s) are added in the matrix (with zeros as
the cost elements) to make it a square matrix. After making the given cost matrix
a square matrix, the Hungarian method may be used to solve the problem.

Example
MEGA printing press, a publisher headquartered in Addis Ababa, wants to
assign three recently hired college graduates, Marta, Bakcha and Hirut to
regional sales districts in Mekelle, Bahir Dare, and DireDawa. But the firm also
has an opening in Gambela and would send one of the three there if it were more
economical than a move to Mekelle, Bahir Dar and Dire Dawa. It will cost Br.
1,000 to relocate Marta to Gambela, Br. 800 to relocate Baklcha there, and Br.
1,500 to move Hirut. What is the optimal assignment of personnel to offices?
Offi
Bahir Dire
ce Mekelle
Dare Dawa
Hire
Marta Br.800 Br 1,100 Br 1,200
Bekcha Br. 500 Br 1,600 Br 1,300
Hirut Br. 500 Br 1,000 Br 2,300

Solution

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To balance the problem, we add a dummy row (person) with a zero relocation
cost to each city.
City
C1 C2 C3 C4(Gambela)
P1 800 1,100 1,200 1,000
Person P2 500 1,600 1,300 800
P3 500 1,000 2,300 1,500
Dummy 0 0 0 0

Table: After row reduction Table:

Optimal Assignment
Thus, an optimal assignment can be
C1 C2 C3 C4
made at zero cells (squares).
P1 100 0 100 0
Person City
P2 0 700 400 0
Dummy(No person) Dire Dawa
P3 0 100 1400 700
Hirut Mekelle
Dummy 400 0 0 100
Bekcha Gambela
Marta Bahir Dare

Cost =Br.(0+500+800+1,100)=Br.2,400

D. Restrictions on Assignments
In certain instances, it may happen that a particular match or pairing may be
either undesirable or otherwise unacceptable. For example, an employee may not
have the skills necessary to perform a particular job or a machine may not be
equipped to handle a particular operation. In such cases, the cost of performing
that particular activity by a particular resource is considered to be very large
(written as M or  ) so as to prohibit the entry of this pair of employee-job into
the final solution. When such a restriction is present, a letter (M) is often placed
in the table in the position that would represent a paring. Analysis is performed
as usual except the M is ignored throughout the analysis. That is, M is not used
in any reductions, nor is any value added to it or subtracted from it during the
course of the analysis.

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Example
1. In the modification of a plant layout of a factory four new machines M1,
M2, M3 and M4 are to be installed in a machine shop. There are five vacant
places A, B, C, D and E available. Because of limited space, machine M2 can not
be placed at C and M3 cannot be placed at A. the cost of placing of machine at
place i (in $) is shown below.
2. Location

A B C D E
M1 9 11 15 10 11
Machine M2 12 9 - 10 9
M3 - 11 14 11 7
M4 14 8 12 7 8
Find the optimal assignment schedule.

Solution:
As the cost matrix is not balanced, add one dummy row (machine) with a
zero cost element in that row. Also assign a high cost, denoted by M, to the
pair (M2, C) and (M3, A).

Apply the Hungarian method to solve the problem

Table: Optimal assignment

A B C D E
A B C D E
M1 9 11 15 10 11 M1 0 2 6 1 2
M2 12 9 M 10 9
M3 M 11 14 11 7
0 0
M4 14 8 12 7 8 3 M 1
M2
M5 0 0 0 0 0

0
M3 M 4 7 4
0

M4 0 0 0 0 0
7 5 1

M5

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 The total minimum cost ($) and optimal assignments made are as follows:

Location Costs ($)

Machine
M1 A 9
M2 B 9
M3 E 7
M4 D 7
M5 (Dummy) C 0
Total = $32

Exercise:
1. A car rental company has one car at each of five depots a, b, c, d and e. A
customer in each of the five towns A, B, C, D and E requires a car. The distance
in (in kilometers) between the depots and towns where the customers are, is
given in the following distance matrix:
Depots

a b c d e
A 160 130 175 190 200
B 135 120 130 160 175
Towns

C 140 110 155 170 185

D 50 50 90 80 110
E 55 35 70 80 105

How should the cars be assigned to the customers so as to minimize the

distance traveled?
Answer:
A e

B c

C b

D d

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 Minimum distance = 570 km

3. An airline company has drawn up a new flight schedule involving five

flights. To assist in allocating five pilots to the flights, it has asked them to state
their preference scores by giving each flight a number out of 10 .The higher the
number , the greater is the preference. Certain of these flights are unsuited to
some pilots owing to domestic reasons. These have been marked with a X

Flight number
Pilot

a b c d e
A 8 2 X 5 4
B 10 9 2 8 4
C 5 4 9 6 X
D 3 6 2 8 7
E 5 6 10 4 3

What should be the allocation of the pilots to flights in order to meet as many
performances as possible?
(Hint: The problem is to maximize the total preference score)

Pilot Flight No Preference Score

A 1 8
B 2 9
C 4 6
D 5 7
E 3 10
Total 40

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