Transportation problem

Transportation
• Aim: to determine the optimum transportation
schedule that minimizes total transportation
cost / time.
• Though Transportation problem can be solved
using standard LP, however the transportation
algorithm is computationally more efficient.
• The prime contributors are F L Hitchcock
(1941), T. C. Koopmans (1949) & G. B
.Dentzig (1951).
 Transportation
• The problem can be represented in the form of
transportation table: change table

Warehouse W1 W2 W3 Wn Capacity
Factories (aj)
F1 X11, C11 X12,C12 X13, C13 X1n, C1n a1
.. .. .. ..
F3 .. .. .. ..
Fm Xm1, Cm1 .. .. Xmn, Cmn an
Requirement b1 .. .. bn 
(bi)
 Transportation
• Mathematically it can be expressed as:
m n
• Minimize Z =  CijXij (Objective Function)
i 1 j 1

• Subject to:
•
n

 Xij  ai; for i = 1, 2, ……., m

j 1 (Capacity Constraint)
•
m

 Xij  bj; for j = 1, 2, ……., n

i 1
(Requirement Constraint)
• Xij >= 0 for all i & j (Non Negativity Condition)
 Transportation
The characteristics of TP are as follows:
• A limited supply of one commodity is available at certain
sources or origins.
• There is a demand for the commodity at several destinations
• The quantities of supply at each source and the demand at
each destination are constant.
• The shipping or transportation costs per unit from each
source to each destination are assumed to be constant.
• No shipments are allowed between sources or between
destinations. All supply and demand quantities are given in
whole number or integers.
• 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.
 Transportation
Uses of transportation techniques:

– Reduce distribution or transportation cost

– Improve competitiveness of product
– Assist proper location of warehouses
– Assist proper location of new factories or
plants being planned.
– Close down warehouses which are found
costly and uneconomical.
 Transportation
The objective of transportation problem is:

– To identify the optimal shipping routes-

minimum cost route
– To identify the maximum amount that can be
shipped over the optimum route
– To determine the total transformation cost
or the profit of transportation
 Transportation
Origin Destination centers
(Sources of Supply) (Point of demand centers)

3
F1 50000 W1 6000
2
6 7
7

F2 6000 5 W2 4000
2
3
W3 2000
2 5
4
F3 2500 5 W4 1500
 Transportation
• SOLUTION MECHANISM
• Find initial solution
– North West Corner Method
– Least/Minimum Cost Method
– Vogel’s Approximation Method
• Find optimal solution
– Stepping Stone Method
– MODI (Modified Distribution) Method.
 Transportation
Steps in NWCM
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.
 Transportation
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/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, then
it can be broken by selecting the cell where maximum
allocation can be made.
 Transportation
The steps in VAM are as follows
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.
 Transportation
solution algorithm for a transportation problem

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

• Step 2: Obtain an initial basic feasible solution. There are 3
methods to find the initial feasible solution.
– The initial solution obtained by any of the three methods
must satisfy the following condition:
• The solution must be feasible: It must satisfy all the supply and
demand constraints
• The number of positive allocations must equal to m+n-1, n=# of
columns and m = # of Rows
• Step 3: Test the initial solution for optimality
• Step 4: Repeat step 3 until an optimal solution is reached
 Transportation
Rules for drawing each closed loop:

1. Select an unused square (cell) to be evaluates

2. Beginning at this 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
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).
 Transportation
An optimal solution of TP can be obtained by
following two methods
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. To apply this
method, drawing a closed loop is the basic step.
 Transportation
A. Stepping-stone method:

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

A B C D SS
F1 4 2 8 100

F2 5 1 9 200
F3 7 6 3 200
DD 50 150 300 500
 Transportation
A. Stepping-stone method:
Project Project Project ss
A B C
F1 4 2 8 100
50 50 - +

F2 5 1 9 200
100 + 100-
F3 7 6 3 200
200
Dd 50 150 300 500

Unoccupied Cell evaluators

cells
(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
 Transportation
B. Modified Distribution method (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:
Xij = (Ui + Vj) -Cij; for all j and j; Where Xij is the cell
evaluator or opportunity cost
 Transportation
B. Modified Distribution method (MODI- Method)

Examine the sign of each Xij

• For minimization case:
• If Xij < 0, then current basic feasible solution is
optimal.
• If Xij = 0, then the current basic feasible solution
will remain be unaffected but an alternative
solution exists.
• If one or more Xij > 0, then an improved solution
be obtained entering unoccupied cell (i, j), in the
basis. An unoccupied cell having the largest
positive value of Xij is chosen for entering into the
solution mix (new transportation schedule)
 Transportation

3. Modified the distribution as you did in using

the stepping-stone method
4. Obtain a new improved solution by allocating
units to the unoccupied call and calculate the
new transportation cost
5. Test the revised solution for optimality
 Transportation
• SPECIAL CASES IN TRANSPORTATION

– Alternative Optimum Solutions

– Unbalanced Transportation Problems
– When Supply exceeds Demand
– When Demand exceeds Supply
– Degeneracy in Transportation Problem:
A condition that occurs when the No of occupied cells in
any solutions less than the No of rows plus the No of
columns minus 1 in a transportation table. 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
– Prohibited Routes: In this case, the appropriate cell may either
be completely crossed out or a very large per unit transportation
cost assign to it (M)
Assignment problem
 Assignment problem
• ASSIGNMENT MODELS
• Assignment models are special type of
transportation models where
– Number of sources = Number of destinations
– Each capacity and requirement value = 1
• Although these can be solved by using
transportation algorithm
– But a more efficient method is available, popularly
know as Hungarian Method
– The method was developed by Hungarian
Mathematician : D. Konig
 Assignment problem
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 job being presented.
• Loading criteria must be clearly specified such as
“minimizing operating time” or “maximizing
profit” ,or “minimizing production cost” or
“minimizing throughout (production cycle) time ” etc.
 Assignment problem
General Mathematical formulation of AP
• Xij represents the Assignment of ith machine to jth job
and Xij = either 1 or 0 n n


• Cij represent cost of assigning ith person to jth jobCijXij
i 1 j 1
• Mathematically, Xij  1;
n


• Minimize Z =j 1 (Objective Function)
Subject to:
n

 for i = 1, 2, ……., n (Capacity Constraint)

Xij  1;
for j = 1, 2, ……., n, (Requirement Constraint)
i 1

Xij = 0 or 1 for all i & j

 Assignment problem
Formulation of Assignment Problem need to
change

Jobs J1 J2 J3 Jn Capacity
Machines (ai)
M1 X11, X12, X13, X1n, 1
C11 C12 C13 C1n
.. .. .. ..
M3 .. .. .. ..
Mn Xn1, .. .. Xnn, 1
Cn1 Cnn
Requirement 1 1 1 1 
(bj)
 Assignment problem
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 of

a. P constraints: J1 J2 J3
x11 +x12 +x13 =1 operator one
P1 20 15 31
x21 + x22 + x23 =1 operator two
P2 17 16 33
X31 +X32 +X33 = 1 operator three
P3 18 19 27

b. j constraints
x11 + x21 + x31 = 1 job one
x12 + x22 + x32 = 1 job two
x13 + x23 +x33 = 1 job three

Sign Restrictions: xij either 0 or 1 for all i and j

Since all xij can be either 0 or 1, there will be one assignment in each
operator constraint and one assignment in each job constraint.
 Assignment problem
STEPS FOR SOLVING ASSIGNMENT PROBLEM:

Hungarian Method/Food’s Technique/

1. Perform row operation
2. Perform column operation
3. Make the assignments by Circles and crosses
4. If number of assignments = No. of rows or cols.
Optimality has reached – End
5. If not, Draw the minimum number of Vertical and
Horizontal lines covering all zeros
– Select the smallest uncovered element
– Subtract it from all uncovered elements
– Add it to all lying at the intersection of lines
– Go to step 3 and repeat until optimality.
 Assignment problem
Example:
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
(Estimated time in minute)
A B C
120 100 80
Programmers

2 80 90 110
3 110 140 120
 Assignment problem

Special cases in assignment problems

Alternative optimal solution: when there are more
zeros which can give another alternative solution.

When the cost is given as a profit: uses two

techniques:

1. Reduction method (Max aij- all

elements of aij
2. change max in to min 9multiple all
the values of aij by -1