QMT437

GROUP PROJECT

PREPARED BY:
1. IZATUN HAJAR BINTI MOHD NASIR (2019218836)
2. NURULAINA BINTI HUZHURI (2019405698)

CLASS: CS2492B

PREPARED FOR:
DR SITI AIDA BINTI SHEIKH HUSSIN
1. INTRODUCTION

Transportation model in Operation Research consists of two components which

are sources and destinations. Example for sources are factories, warehouses and example
for destinations are the places to deliver the products such as shops, warehouses and
stores. Each source is able to supply a fixed number of units of the product, and each
destination has a fixed demand for the product. Objectives of Transportation always to
minimize the cost.

Meanwhile, Linear Programming in Operation Research is a technique that helps

in resource allocation decisions. Linear Programming is a model consisting of linear
relationships representing a firm’s decisions given an objective and resource constraints.
Objectives of the business frequently to maximize profit or minimize cost. The four
components in Linear Programming model are decision variable, objective function,
constraints and parameters. Decision variables is a mathematical symbols representing
levels of activity of a firm. Objective function is a linear mathematical relationship
describing an objective of the firm, in terms of decision variables, that is maximized or
minimized. Constraints are restrictions placed on the firm by the operating environment
stated in linear relationships of the decision variables. Lastly, parameters are numerical
coefficients and constants used in the objective function and constraint equations.

The purpose of doing this assignment is to see the differences of using these two
models in solving the problems that contains same data and compare the results between
these two models. So, we create the problems and solve the problems by using two
models which are Transportation models and Linear Programming model. To obtain the
results, we solve these two models in QM for Windows.
2. TRANSPORTATION PROBLEMS

The transportation problems in operational research has objective to determine

the amount of goods to transport from sources to destinations in a way that minimizes the
transportation costs. Syarikat Najar has 3 factories that produce rice. These factories are
located in Ampang, Shah Alam and Sabak Bernam. These rice are distributed to three
major outlets in Raub, Kota Tinggi and Ipoh. In order to minimize the total cost
production, we need to know how many tons of rice to deliver from each factories to each
outlets. Therefore, from this problem, we can write the Transportation model as below.

The amount of rice available at each source and the amount required at three demand
centres are specified as below:

Outlets Demand (tons)

Raub 200
Ipoh 100
Kota Tinggi 300
Table 1: Demand Table

The production capacities at the factories are as follows:

Factories Capacity (tons)

Ampang 150
Sabak Bernam 175
Shah Alam 275
Table 2: Supply Table
 The transport cost from factories to outlets (RM/tons) are as below:

Outlets
Factories Raub Ipoh Kota Tinggi
Ampang 6 8 10
Sabak Bernam 7 11 11
Shah Alam 4 5 12

Table 3: Transportation Cost From Factories to Outlets

2.1 LINEAR PROGRAMMING MODEL

From the transportation problems, we also convert the problems into Linear
Programming model as below.

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
3. SOLUTIONS

From the transportation problems, we have two models which are Transportation model
and Linear Programming model. So, we solve these two models by using QM for
Windows to obtain the solutions.

3.1 SOLUTIONS FOR TRANSPORTATION MODEL

Table 4: Transportation Results

Table 5: Marginal Cost or The Cost for Empty Cells for Table 4

Table 6: Final Solutions Table

 Table 7: Iterations Table

Table 8: Optimal Solutions

3.2 SOLUTIONS LINEAR PROGRAMMING MODEL

Table 9: Linear Programming Results

Table 10: Iteration 1

Table 11: Iteration 2

Table 12: Iteration 3

Table 13: Iteration 4

Table 14: Iteration 5

Table 15: Iteration 6

 Table 16: Iteration 7

Table 17: Iteration 8

Table 18: Iteration 9

Table 19: Phase 2 (Iteration 10)

 Table 20: Iteration 11

Table 21: Original Problem

Table 22: Dual Problem

4. ANALYSIS

4.1 ANALYSIS FOR TRANSPORTATION MODEL

4.1.1 LEAST COST METHOD

Begin the steps at the cell with the lowest transportation cost. If a tie exists,
choose the cells whose demand is more. Then compare available supply and demand for
the cell. Allocate the smaller of the two values to this cell. If either the supply or the
demand remaining equals to zero, no allocation can be made. If more allocation can be
made, move to the cell with the next lowest transportation cost and repeat the step before.
Repeat the step until there is no allocation can be made.

The result is there are 25 tons of rice delivered from Ampang to Raub and 125
tons of rice delivered to Kota Tinggi from the same factory. Kota Tinggi also received
175 tons of rice from Sabak Bernam factory. Shah Alam factory has delivered 175 and
100 tons of rice to Raub and Ipoh respectively. After that, calculate the initial cost
solution. Since QM for Window only show the final transportation, so we construct the
initial table transportation as below.

To
From A B C Supply

6 8 10
1 25 125 150

7 11 11
2 175 175

4 5 12
3 200 75 275
Demand 200 100 300 600

Initial cost = 25(8) + 125(10) + 175(11) + 200(4) + 75(5) = RM4550

4.1.2 MODIFIED DISTRIBUTION METHOD (MODI)

Find the optimal solution by Modified Distribution Method. Let

Ui = value assigned to row i

Vj = value assigned to column j
Cij = cost in square ij

Then, to compute the values for each row and column, set ui + vj = cij but only for those
squares that are currently used. After that, set u1 = 0. Solve the system for all u and v
values.

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

let u1 = 0 and solve to obtain:

vB = 8, vc = 10, u2 = 1, u3 = -3, vA= 7

Then, compute the improvement index for each unused square by the formula kij = cij –
ui – vj = cost increase or decrease that would occur by allocating to a cell. If kij ≥ 0 for
all the unused squares, then the initial solution is the optimal solution.

For the empty cells:

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

 Table 23: Iterations Table

As we can see from above index that in Iteration 1, the answers from empty
cells have negative values. Solutions are not optimal if the empty cells at the index
has negative values. Thus, Iteration 1 does not give optimal values. If the solution is
not optimal, use Stepping Stone Method. To do Stepping Stone, first of all, choose a
cell with the best improvement index which is the smallest negative index. Begin at
the square. Trace closed path back to the original square. After that, compute again
the improvement index for each unused square until none of the values are negatives.
In Table 7, Iteration 2 shows the answer after doing Stepping Stone. Thus, we can see
the cost changes for the empty cells from Iteration 1 and 2 as shows in Table 7.

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
 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

Table 24: Marginal Cost or The Cost for Empty Cells for Table 4

Table 5 shows the value for the empty cells after doing Stepping Stone. From
Table 5, we can conclude that the marginal cost from Ampang factory to Ipoh is RM1
while Sabak Bernam factory to Raub and Ipoh are RM0 and RM3 respectively. From
Shah Alam to Kota Tinggi, the marginal cost is RM4.

From the table 4, 5 and 6, we compile the data to be a new transportation

table as below.

To
From A B C Supply

6 8 10
1 25 (1) 125 150

7 11 11
2 (0) (3) 175 175

4 5 12
3 175 100 (4) 275
Demand 200 100 300 600
 Table 25: Optimal Solutions

Then, calculate the transportation cost using the values from Table 8. We obtained
the minimum transportation cost which is RM 4525 after sum up the column of shipment cost
in table above.
4.2 ANALYSIS FOR LINEAR PROGRAMMING MODEL

4.2.1 LINEAR PROGRAMMING (SIMPLEX METHOD)

Setting up the first simplex tableau.

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

Table 26: Iteration 1

In the first simplex tableau :

 Variables in solution mix are reffered as basic variables

 Variables not in the solution mix are called as non-basic variables
 Cj : Profit contribution per unit of each variable
 Zj : In the quantity column, provides total contribution
 In Simplex solution, we need to determine which variable to enter into the
next solution mix. Identify the column with the largest positive number in the Cj – Zj
row. The column identified is called the pivot column. Then, determine which
variable to replace. The row with the smallest non negative number will be replaced
in the next tableau. This row referred as pivot row. Next, compute new values for the
pivot row and new values for each remaining row.

Then, compute the Zj and Cj – Zj rows. Repeat the steps until the numbers in
the Cj – Zj row are zero or negative, we have found the optimal solution.

Table 27: Iteration 2

Table 28: Iteration 3

Table 29: Iteration 4

Table 30: Iteration 5

Table 31: Iteration 6

Table 32: Iteration 7

Table 33: Iteration 8

 Table 34: Iteration 9

Table 35: Phase 2 (Iteration 10)

Table 36: Iteration 11

Table 20 is the last simplex tableau as the answer shows optimal value. As we can see
from Table 20, the value of Zj is 4525. Thus, the optimal cost is RM4525.
4.2.2 THE DUAL

If the primal is minimization, the dual is maximization. The RHS values of the
primal constraints become the dual’s objective function coefficients and the primal
objective function coefficients become the RHS values of the dual constraints. The
transpose of the primal constraint coefficients become to the dual constraint coefficients.
Last but not least, the inequality signs are reversed

Table 37: Original Problem

Table 38: Dual Problem

5. CONCLUSION

In a nutshell, as we can see that the problem can be solved by using two models
which are transportation model and linear programming model. Both model gives us the
same value of optimal solution which is RM 4525.

An advantage to the transportation method is that the solution process involves

only the main variables. Artificial variables are not required, as they are in the simplex
process. Meanwhile for Linear Programming (simplex method), the artificial variables are
required in the simplex tableau which make the method more complex. Simplex method
requires a lot of iteration before we get the optimal solution which each represented by
another simplex tableau. Calculation also are much easier to obtain with a new
transportation table than a new simplex tableau.

The linear programming (simplex method) involves time consuming

computations, and it is easy to make mistake when working the problems by hand but we
can solve the same problem using transportation method by hand and still get the same
answer. If the number of variables and constraint are more in the given problem, so the
solution by using Linear Programming will be very long. However, by using
transportation method, the solutions only require a few steps and in very simple and easy
way. So we can conclude that although the value of optimal solutions for both methods
are similar, but the transportation method is easier than using linear programming
method.