Operations Management William J. Stevenson 8th edition

The Transportation Model CHAPTER 8s The Transportation Model Operations Management, Eighth Edition, by William J. Stevenson Copyright © 2005 by The McGraw-Hill Companies, Inc. All rights reserved. McGraw-Hill/Irwin

Requirements for Transportation Model List of origins and each one’s capacity List of destinations and each one’s demand Unit cost of shipping Note: The DVD that accompanies this book contains a module that provides detailed instruction on the transportation model

Transportation Model Assumptions Items to be shipped are homogeneous Shipping cost per unit is the same Only one route between origin and destination

The Transportation Problem Figure 8S.1 D (demand) S (supply)

A Transportation Table Table 8S.1 Warehouse 4 7 1 100 12 3 8 200 10 16 5 150 450 80 90 120 160 A B C D 2 Factory Factory 1 can supply 100 units per period Total supply capacity per period Total demand per period Demand Warehouse B can use 90

Special Problems Unequal supply and demand Dummy: Imaginary number added equal to the difference between supply and demand when these are unequal Degeneracy: The condition of too few completed cells to allow all necessary paths to be constructed

Summary of Procedure Make certain that supply and demand are equal Develop an initial solution using intuitive, low-cost approach Check that completed cells = R+C-1 Evaluate each empty cell Repeat until all cells are zero or positive

Excel Template Figure 8S.2

CHAPTER 8s Additional PowerPoint slides contributed by Geoff Willis, University of Central Oklahoma.

ANALYSES Transportation Model Center of gravity & simple median models minimizes transportation costs using LP Center of gravity & simple median models minimizes transportation costs using geometry

Center of Gravity Determine the center of gravity for the destinations shown on the following map. Monthly shipments will be the quantities listed in the table. Destination Quantity D1 900 D2 300 D3 700 D4 600 D5 800 D2 D5 D1 D4 D3