Transportation and Assignment Problems

• The Transportation Model

• Solution of a Transportation Problem
• The Assignment Model
• Solution of the Assignment Model

1 Department of CSE, CUET

 Transportation and Assignment Problems Overview

- Part of a larger class of linear programming problems known as network flow

models.
- Possess special mathematical features that enabled development of very
efficient, unique solution methods.
- Methods are variations of traditional simplex procedure.

2 Department of CSE, CUET

 The Transportation Model
Characteristics

• A product is transported from a number of sources to a number of

destinations at the minimum possible cost.
• Each source is able to supply a fixed number of units of the product, and
each destination has a fixed demand for the product.
• The linear programming model has constraints for supply at each source
and demand at each destination.
• All constraints are equalities in a balanced transportation model where
supply equals demand.
• Constraints contain inequalities in unbalanced models where supply does
not equal demand.

3 Department of CSE, CUET

 Transportation Model Example
Problem Definition and Data

- Problem:How many tons of wheat to transport from each grain elevator to each mill on a monthly
basis in order to minimize the total cost of transportation ?
- Data: Grain Elevator Supply Mill Demand
1. Kansas City 150 A. Chicago 200
2. Omaha 175 B. St.Louis 100
3. Des Moines 275 C. Cincinnati 300
Total 600 tons Total 600 tons

4 Department of CSE, CUET

 Transportation Model Example
Model Formulation
minimize Z = $6x1A + 8x1B + 10x1C + 7x2A + 11x2B + 11x2C + 4x3A + 5x3B + 12x3C

subject to x1A + x1B + x1C = 150

x2A + x2B + x2C = 175
x3A + x3B+ x3C = 275
x1A + x2A + x3A = 200
x1B + x2B + x3B = 100
x1C + x2C + x3C = 300
xij ≥ 0

where xij = tons of wheat

from each grain elevator,
i, i = 1, 2, 3, to each mill
j, j = A,B,C
Network of transportation routes for wheat
shipments

5 Department of CSE, CUET

 Solution of the Transportation Model
Tableau Format
• Transportation problems are solved manually within a tableau format.
• Each cell in a transportation tableau is analogous to a decision variable that indicates
the amount allocated from a source to a destination.
• The supply and demand values along the outside rim of a tableau are called rim
values.

The
Transportation
Tableau

6 Department of CSE, CUET

 Solution of the Transportation Model
Solution Methods

• Transportation models do not start at the origin where all decision values are zero;
they must instead be given an initial feasible solution.
• Initial feasible solution determination methods include:
- northwest corner method
- minimum cell cost method
- Vogel’s Approximation Method
• Methods for solving the transportation problem itself include:
- stepping-stone method and
- modified distribution method.

7 Department of CSE, CUET

 The Northwest Corner Method

- In the northwest corner method the largest possible allocation is made to the cell in the upper left-hand
corner of the tableau , followed by allocations to adjacent feasible cells.

The Initial NW
Corner Solution

- The initial solution is complete when all rim requirements are satisfied.
- Transportation cost is computed by evaluating the objective function:
Z = $6x1A + 8x1B + 10x1C + 7x2A + 11x2B + 11x2C + 4x3A + 5x3B + 12x3C
= 6(150) + 8(0) + 10(0) + 7(50) + 11(100) + 11(25) + 4(0) + 5(0) + !2(275)
= $5,925

8 Department of CSE, CUET

 The Northwest Corner Method

Summary of Steps

1. Allocate as much as possible to the cell in the upper left-hand

corner, subject to the supply and demand conditions.
2. Allocate as much as possible to the next adjacent feasible cell.
3. Repeat step 2 until all rim requirements are met.

9 Department of CSE, CUET

 The Modified Distribution Method (MODI)

Optimality Test:

Once an initial solution is obtained, the next step is to check its optimality. An
optimal solution is one where there is no other set of transportation routes
(allocations) that will further reduce the total transportation cost. Thus, we have to
evaluate each un-occupied cell in the transportation table in terms of an
opportunity of reducing total transportation cost.

If we have a B.F.S. consisting of (m+ n–1) independent positive allocations and a

set of arbitrary number ui and vj (i=1,2,...m; j=1,2,...n) such that cij = ui+vj for all
occupied cells (i, j) then the evaluation dij corresponding to each empty cell (i,
j) is given by :
dij = cij – (ui+ vj)
This evaluation is also called the opportunity cost for un-occupied cells.

10 Department of CSE, CUET

 u-v Method

Step 1: Start with B.F.S. consisting of (m+ n–1) allocations in

independent positions.
Step 2: Determine a set of m+n numbers ui (i=1,2,....m) and
vj (j=1,2,...n) for all the rows and columns such that for each
occupied cell (i,j), the following condition is satisfied :
cij = ui+vj
Step 3: Calculate cell evaluations (opportunity cost) dij for
each empty cell (i,j) by using the formula :
dij = cij – ( ui+vj ) for all i & j.

11 Department of CSE, CUET

 The Modified Distribution Method (MODI)

Step 4: Examine the matrix of cell evaluation dij for negative

entries and conclude that
(i) If all dij > 0 , then solution is optimal and unique.
(ii)If at least one dij = 0 , then solution is optimal and alternate
solution also exists.
(iii)If at least one dij < 0 ,then solution is not optimal and an improved solution
can be obtained.
In this case, the un-occupied cell with the largest negative value of dij is
considered for the new transportation schedule.
Step 5: Construct a closed path (loop) for the unoccupied cell having largest
negative opportunity cost. Mark a (+) sign in this cell and move along the rows
(or columns) to find an occupied cell. Mark a (-) sign in this cell and find out
another occupied cell. Repeat the process and mark the occupied cells with (+)
and (-) signs alternatively. Close the path back to the selected unoccupied cell.

12 Department of CSE, CUET

 The Modified Distribution Method (MODI)

Step 6: Select the smallest quantity amongst the cells marked with (-) sign.
Allocate this value to the unoccupied cell of the loop and add and subtract it
in the occupied cells as per their signs.
Thus an improved solution is obtained by calculating the total transportation
cost by this method.

Step 7: Test the revised solution further for optimality. The procedure
terminates when all dij ≥ 0 , for unoccupied cells.

13 Department of CSE, CUET

 The Modified Distribution Method (MODI)
(1 of 6)
- MODI is a modified version of the stepping-stone method in which math equations replace
the stepping-stone paths.
- In the table, the extra left-hand column with the ui symbols and the extra top row with the
vj symbols represent values that must be computed.
- Computed for all cells with allocations :
ui + vj = cij = unit transportation cost for cell ij.

The Minimum Cell Cost

Initial Solution

14 Department of CSE, CUET

 The Modified Distribution Method (MODI)
(2 of 6)
- Formulas for cells containing allocations:
x1B: u1 + vB = 8
x1C: u1 + vC = 10
x2C: u2 + vC = 11
x3A: u3 + vA = 4
x3B: u3 + vB = 5

The Initial Solution with All ui and vj

- Five equations with 6 unknowns, therefore let u1 = 0 and solve to obtain: Values
vB = 8, vC = 10, u2 = 1, u3 = -3, vA= 7

15 Department of CSE, CUET

 The Modified Distribution Method (MODI)
(3 of 6)

- Each MODI allocation replicates the stepping-stone allocation.

- Use following to evaluate all empty cells:
cij - ui - vj = kij
where kij equals the cost increase or decrease that would occur by allocating to a cell.
- For the empty cells in Table 26:
x1A: k1A = c1A - u1 - vA = 6 - 0 - 7 = -1
x2A: k2A = c2A - u2 - vA = 7 - 1 - 7 = -1
x2B: k2B = c2B - u2 - vB = 11- 1 - 8 = +2
x3C: k3C = c3C - u3 -vC = 12 - (-3) - 10 = +5

16 Department of CSE, CUET

 The Modified Distribution Method (MODI)
(4 of 6)
- After each allocation to an empty cell, the ui and vj values must be recomputed.

The Second Iteration of the MODI Solution

Method

17 Department of CSE, CUET

 The Modified Distribution Method (MODI)
(5 of 6)
- Recomputing ui and vj values:
x1A: u1 + vA = 6, vA = 6 x1C: u1 + vC = 10, vC = 10 x2C: u2 + vC = 11, u2 = 1
x3A: u3 + vA = 4, u3 = -2 x3B: u3 + vB = 5, vB = 7

The New ui and vj Values for the Second

Iteration

18 Department of CSE, CUET

 The Modified Distribution Method (MODI)
(6 of 6)

- Cost changes for the empty cells, cij - ui - vj = kij;

x1B: k1B = c1B - u1 - vB = 8 - 0 - 7 = +1
x2A: k2A = c2A - u2 - vA = 7 - 1 - 6 = 0
x2B: k2B = c2B - u2 - vB = 11 - 1 -7 = +3
x3C: k2B = c2B - u3 - vC = 12 - (-2) - 10 = +4

- Since none of the values are negative, solution obtained is optimal.

- Cell 2A with a zero cost change indicates a multiple optimal solution.

19 Department of CSE, CUET

 The Modified Distribution Method (MODI)
Summary of Steps

1. Develop an initial solution.

2. Compute the ui and vj values for each row and column.
3. Compute the cost change, kij, for each empty cell.
4. Allocate as much as possible to the empty cell that will
result in the greatest net decrease in cost (most negative kij)
5. Repeat steps 2 through 4 until all kij values are positive or
zero.

20 Department of CSE, CUET

 The Unbalanced Transportation Model
(1 of 2)
- When demand exceeds supply a dummy row is added to the tableau.

An Unbalanced Model
(Demand . Supply)

21 Department of CSE, CUET

 The Unbalanced Transportation Model
(2 of 2)
- When supply exceeds demand, a dummy column is added to the tableau.
- The dummy column (or dummy row) has no effect on the initial solution methods or the
optimal solution methods.

An Unbalanced Model (Supply .

Demand)

22 Department of CSE, CUET

 Excercise
A company supplies goods from two warehouses to three customers
(who still want 30 units each). Unfortunately, warehouse 1 and 40
units and warehouse 2 has 30 units so we cannot fulfill all the orders.
The costs of shipping are the same as before. There will be a penalty
for each unit of unmet customer demand: $90, $80, and $110 for
customers 1, 2 and 3 respectively. Formulate a balanced
transportation problem to minimize the shortage and shipping costs.

23 Department of CSE, CUET

Excercise

24 Department of CSE, CUET

 Degeneracy

We must make the test for acceptability to use the stepping-stone methodology,
that mean the feasible solution must met the condition of the number of
occupied squares in any solution must be equal to the number of rows in the
table plus the number of columns minus 1
M (number of rows) + N (number of columns ) = allocated cells
If a solution does not satisfy this rule it is called
degenerate

25 Department of CSE, CUET

 Degeneracy
(1 of 3)
- In a transportation tableau with m rows and n columns, there must be m + n - 1 cells with
allocations; if not, it is degenerate.
- The tableau in the figure does not meet the condition since 3 + 3 -1 = 5 cells and there are
only 4 cells with allocations.

The Minimum Cell Cost Initial

Solution
26 Department of CSE, CUET
 Degeneracy
(2 of 3)
- In a degenerate tableau, all the stepping-stone paths or MODI equations cannot be
developed.
-To rectify a degenerate tableau, an empty cell must artificially be treated as an occupied
cell.

The Initial
Solution

27 Department of CSE, CUET

 Degeneracy
(3 of 3)
- The stepping-stone path s and cost changes for this tableau:
2A 2C 1C 1A
x2A: 7 - 11 + 10 - 6 = 0
2B 2C 1C 1B
x2B: 11 - 11 + 10 - 8 = + 2
3B 1B 1A 3A
x3B: 5-8+6-4= -1
3C 1C 1A 3A
x3C: 12 - 10 + 6 - 4 = + 4

The Second Stepping-Stone

Iteration

28 Department of CSE, CUET

 Prohibited Routes

- A prohibited route is assigned a large cost such as M.

- When the prohibited cell is evaluated, it will always
contain the cost M, which will keep it from being
selected as an entering variable.

29 Department of CSE, CUET

 The Minimum Cell Cost Method
(1 of 3)
- In the minimum cell cost method as much as possible is allocated to the cell with the
minimum cost followed by allocation to the feasible cell with minimum cost.

The Initial Minimum Cell Cost

Allocation

The Second Minimum Cell Cost

Allocation

30 Department of CSE, CUET

 The Minimum Cell Cost Method
(2 of 3)
- The complete initial minimum cell cost solution; total cost = $4,550.
- The minimum cell cost method will provide a solution with a lower cost than
the northwest corner solution because it considers cost in the allocation process.

The Initial
Solution

31 Department of CSE, CUET

 The Minimum Cell Cost Method
(3 of 3)

Summary of Steps

1. Allocate as much as possible to the feasible cell with the

minimum transportation cost, and adjust the rim requirements.
2. Repeat step 1 until all rim requirements have been met.

32 Department of CSE, CUET

 Vogel’s Approximation Method (VAM)
(1 of 5)
- Method is based on the concept of penalty cost or regret.
- A penalty cost is the difference between the largest and the next largest cell cost in a row
(or column).
- In VAM the first step is to develop a penalty cost for each source and destination.
- Penalty cost is calculated by subtracting the minimum cell cost from the next higher cell
cost in each row and column.

The VAM Penalty

Costs

33 Department of CSE, CUET

 Vogel’s Approximation Method (VAM)
(2 of 5)
- VAM allocates as much as possible to the minimum cost cell in the row or column with
the largest penalty cost.

The Initial VAM

Allocation

34 Department of CSE, CUET

 Vogel’s Approximation Method (VAM)
(3 of 5)
- After each VAM cell allocation, all row and column penalty costs are recomputed.

The Second
VAM Allocation

35 Department of CSE, CUET

 Vogel’s Approximation Method (VAM)
(4 of 5)
- Recomputed penalty costs after the third allocation.

The Third VAM

Allocation

36 Department of CSE, CUET

 Vogel’s Approximation Method (VAM)
(5 of 5)
- The initial VAM solution; total cost = $5,125
- VAM and minimum cell cost methods both provide better initial solutions than does the
northwest corner method.

The Initial VAM

Solution

37 Department of CSE, CUET

 Vogel’s Approximation Method (VAM)
Summary of Steps

1. Determine the penalty cost for each row and column.

2. Select the row or column with the highest penalty cost.
3. Allocate as much as possible to the feasible cell with the
lowest transportation cost in the row or column with the
highest penalty cost.
4. Repeat steps 1, 2, and 3 until all rim requirements have been
met.

38 Department of CSE, CUET