POM - QM FOR WINDOWS

Version 3
Software for Decision Sciences:
Quantitative Methods,
Production and Operations Manae!ent
"oward #$ Weiss
www$prenha%%$co!&weiss
dsSoftware'prenha%%$co!
#une (), *))+
Copyright (c) 2006 by Pearson Education, Inc., Upper Saddle i!er, "e# $ersey, 0%&'(.
Pearson Prentice )all. *ll rights reser!ed.
,a-%e of .ontents
.hapter /: Introduction
Overview...........................................................................1
Hardware and Software Requirements..............................3
Installing the Software.......................................................4
The Program Grou...........................................................!
Starting the Program.........................................................."
The #ain S$reen...............................................................%
.hapter *: 0 Sa!p%e Pro-%e!
Introdu$tion.....................................................................1&
'reating a (ew Pro)lem.................................................13
The *ata S$reen..............................................................1!
+ntering and +diting *ata...............................................1!
The Solution S$reen........................................................1%
.hapter (: ,he Main Menu
,ile..................................................................................1-
+dit.................................................................................. &4
.iew................................................................................ &!
#odule............................................................................&"
,ormat.............................................................................&%
Tools...............................................................................3/
0indow...........................................................................3/
Hel................................................................................. 3&
.hapter 1: Printin
The Print Setu S$reen....................................................3"
Information to Print.........................................................3%
Page Header Information.................................................31
Page 2a3out.....................................................................3-
Printer Otions................................................................4/
v
PO#45# for 0indows
.hapter +: 2raphs
Introdu$tion.....................................................................4&
,ile Saving......................................................................43
Print................................................................................. 43
'olors and ,onts.............................................................43
.hapter 3: Modu%es
Overview.........................................................................44
6ggregate 7Produ$tion8 Planning....................................4!
6ssem)l3 2ine 9alan$ing................................................!%
The 6ssignment #odel..................................................."!
9rea:even;'ost4.olume 6nal3sis..................................."%
'aital Investment...........................................................%1
*e$ision 6nal3sis............................................................%3
,ore$asting......................................................................14
Game Theor3...................................................................--
Goal Programming........................................................1/&
Integer < #i=ed Integer Programming..........................1/"
Inventor3.......................................................................1/-
>o) Sho S$heduling 7Sequen$ing8................................11%
2a3out...........................................................................1&"
2earning 7+=erien$e8 'urves.......................................13/
2inear Programming......................................................133
2o$ation........................................................................13-
2ot Si?ing......................................................................14!
#ar:ov 6nal3sis...........................................................1!/
#aterial Requirements Planning...................................1!4
(etwor:s.......................................................................1"1
Produ$tivit3...................................................................1"!
Pro@e$t S$heduling.........................................................1""
5ualit3 'ontrol..............................................................1%!
Relia)ilit3......................................................................11&
Simulation.....................................................................11!
Statisti$s........................................................................111
The Transortation #odel.............................................1-3
0aiting 2ines................................................................1-%
0or: #easurement.......................................................&/"
0ppendices
6. 'ustomi?ation due to te=t)oo:.........................................&1/
9. Aseful hints for modules....................................................&11
vi
Preface
It is hard to )elieve that POM-QM for Windows 7formerl3 DS for Windows8 has
)een in e=isten$eB first as a *OS rogram and then as a 0indows rogramB for
over 1! 3ears. It seems li:e we have )een using )oth mini$omuters and 0indows
forever )ut in fa$t large4s$ale 0indows usage has )een for less than a de$ade. 6t
the time that I finished the original *OS .ersionB few students had ersonal
$omuters or :new what an ISP was. Toda3B sin$e a large ma@orit3 of students
have their own $omuters this software is even more valua)le than it has ever
)een.
The original goal in develoing software was to rovide students with the most
user4friendl3 a$:age availa)le for rodu$tion;oerations managementB
quantitative methodsB management s$ien$eB and oerations resear$h. 0e are
gratified )3 the resonse to the revious versions of POM-QM for Windows
indi$ating that we have $learl3 met our goal.
QM for Windows 7.ersion 1./8 was first distri)uted in the summer of 1--" while a
searate )ut similar rogramB POM for Windows 7.ersion 1.18 was first distri)uted
in the fall of 1--". DS for WindowsB whi$h $ontained all of the modules in )oth
POM and QM and also $ame with a rinted manual was first distri)uted in 1--%.
.ersion & of all three rograms was $reated for 0indows -! and distri)uted in the
fall of 1---.
,or this new versionB version 3B we have $ollased the three former rodu$ts into
one rodu$t named POM-QM for Windows. ,or $onsisten$3 with ast versionsB
when using Prenti$e4Hall te=ts it is ossi)le to install the rogram as POM for
Windows or QM for Windows and to disla3 the POM for Windows or QM for
Windows module menu. Regardless of the name of the des:to i$on all of the
modules are availa)le to all users. 0e will refer to the rodu$t as POM-QM for
Windows throughout this manual.
This is a a$:age that $an )e used to sulement an3 te=t)oo: in the )road area
:nown as *e$ision S$ien$es. This in$ludes Produ$tion and Oerations
#anagementB 5uantitative #ethodsB #anagement S$ien$eB or Oerations
Resear$h.
vii
PO#45# for 0indows
9elow is a summar3 of the ma@or $hanges in$luded in version 3. These $hanges
fall into three $ategoriesC module enhan$ementsB fun$tionalit3B and user4
friendliness.
Modu%e 4nhance!ents
In the aggregate lanning module we have added a model to $reate a transortation
ro)lem. ,or assem)l3 line )alan$ing we have added a disla3 that summari?es
the results when using ea$h of the methods. ,or de$ision ta)les we have added an
outut disla3 for various values of alha when $omuting the Hurwi$? value. Our
most e=$iting new addition is that in de$ision anal3sis we now have an eas34to4use
grahi$al user interfa$e to $reate the de$ision tree. In additionB we have added a
new model for $reating de$ision ta)les for one eriod inventor3 7sul3;demand8
ro)lems. In fore$astingB we have added a model that allows the user to enter the
fore$asts in order to run an error anal3sis. In additionB we have added the #6P+
as standard outut for all models and added fore$ast $ontrol with $omutation of
the tra$:ing signal. In inventor3 we have added the reorder oint models for )oth
normal and dis$rete demand distri)utions. In @o) sho s$hedulingB for one ma$hine
sequen$ing we have allowed for in$lusion of the dates that @o)s are re$eived and
we have added a disla3 that summari?es the results when using all of the
methods. In lo$ation we have added a lo$ation $ost4volume 7)rea:even8 anal3sis
model. In linear rogramming we disla3 the inut in equation form on the right of
the ta)le and have added an outut that has the dual model of the original ro)lem.
It is also now ossi)le to rint the $orner oints of a grah. In ro@e$t management
we disla3 the $riti$al ath in red. In qualit3 $ontrol it is now ossi)le to set the
$enter line in the $ontrol $harts rather than using the mean of the data. 0e have
e=tended our statisti$s model to in$lude $omutations for a list of dataB a
frequen$3 ta)le or a ro)a)ilit3 distri)ution as well as adding a normal distri)ution
model.
Functiona%it5
The formatting and rinting otions have )een imroved. It is now ossi)le to
format the de$imal disla3s on )oth the s$reen and rintouts. The right4$li$:
otions on ta)les and grahs have )een enhan$ed so that it is now ossi)le to
easil3 $o3B rint or save grahs. 0hen rintingB it is ossi)le to sele$t individual
grahs to rint rather than having to rint all of the availa)le grahs. Otions for
adding multile rows or $olumns have )een added. The annotation otion has )een
imroved. The Save as +=$el otion has )een e=anded to in$lude nearl3 all of the
models. The 0indows $al$ulator will )e used when found rather than the more
rimitive $al$ulator that is in$luded with POM-QM for Windows. S$roll )ars have
)een added to the fore$astingB learning $urve and Oerating 'hara$teristi$ grahs
in order to easil3 disla3 the $hanges in the grahs as a fun$tion of the arameters.
viii
6ser Friend%iness
6s mentioned a)oveB we have $om)ined all three a$:ages into one a$:age in
order that all models will )e availa)le to the students 4 ese$iall3 students who
ta:e )oth an Oerations #anagement 'ourse and a 5uantitative #ethods $ourse.
0e still allow for student $hoi$e of menu 7PO#B 5# or )oth8 to minimi?e
$onfusion. In additionB in order to imrove the understanding of the models we
have added searators )etween models in the model su)menu sele$tion menu. 0e
have $om)ined integer and mi=ed integer rogramming into one module. 0e have
added an overview ta) to the ro)lem $reation s$reen to hel des$ri)e the otions
that are availa)le. #anuals in )oth P*, format 7this do$ument8 and 0ord format
have )een added so that users ma3 easil3 a$$ess the manual while running the
rogram or rint ages from the manual. Tutorials whi$h wal: 3ou through $ertain
oerations ste4)34ste are in$luded in the "e%p menu. The e=amles used in this
manual are in$luded in the installation. #ore user $ustomi?ation otions are
availa)le in the Aser Information se$tion under the Hel menu.
To the students who use this softwareB I hoe 3ou find that this software
$omlements 3our te=t well. To the instru$tors who use this softwareB than: 3ou
for $hoosing POM-QM for Windows. I wel$ome 3our $ommentsB ese$iall3 )3 e4
mail at dsSoftwareDrenhall.$om.
i=
PO#45# for 0indows
0c7now%ed!ents
The develoment of an3 large s$ale ro@e$t su$h as POM-QM for Windows
requires the assistan$e of man3 eole. I have )een ver3 fortunate in gaining the
suort and advi$e of students and $olleagues from around the glo)e. 0ithout
their helB POM-QM for Windows would not have )een as su$$essful as it has
)een.
In arti$ularB though I would li:e to than: the students in 9arr3 RenderEs $lasses at
Rollins 'ollege and the students in m3 $lasses at Temle Aniversit3. These
students have alwa3s )een the first to see the new versions and over the 3ears
several students have offered design features that were in$ororated into the
software. Other design features were develoed in resonse to $omments sent to
me from users of .ersions 1 and &. I am e=tremel3 grateful for these $omments
whi$h have immensel3 heled the evolution and $ontinuous imrovement of
POM-QM for Windows.
Several $hanges in the software were ut into la$e in .ersion 3 due to the
$omments of Phili +ntwistleB (orthamton 9usiness S$hool. The original
version of the POM for Windows and QM for Windows software was reviewed )3
*ave Penti$o of *uquesne Aniversit3F 2auren$e >. #oore of .irginia Pol3te$hni$
Institute and State Aniversit3F Raesh G. Soni of Indiana Aniversit3 of
Penns3lvaniaF *onald G. Sluti of the Aniversit3 of (e)ras:a at Gearne3F (agra@
9ala$handran of 'lemson Aniversit3F >a$: Powell of the Aniversit3 of South
*a:otaF Sam Ro3 of #orehead State Aniversit3F and 2ee .olet of Tro3 State
Aniversit3. Their $omments were ver3 influential in the design of the software that
was $arried over to the new version.
In additionB other rofessors who have $ontri)uted to this software are Sri
Sridharan of 'lemson Aniversit3F ,orrest 7,ess8 Green of Radford Aniversit3F
>ohn +. (i$ola3 >r. of the Aniversit3 of #innesotaF 9ill Smith of Tro3 State
Aniversit3F Ro)ert 6. *onnel of Golde349ea$om 'ollegeF *ave 6nstett of the
'ollege of St. S$holasti$aF 2eonard Har)rough of Grand .iew 'ollegeF and
'her3l *ale and Steve #oss. #adeline Thinness of Atah State Aniversit3
rovided an e=tensive review of .ersion & for 0indows.
*is$ussions with ,red #urh3 and the late 'arl Harris have )een ver3 useful to
meB ese$iall3 in the mathemati$al rogramming and queueing modules.
There are several individuals at Prenti$e Hall to whom I must give se$ial than:s.
Ri$h 0ohl and Tom Tu$:er are the editors with whom I had wor:ed on this
ro@e$t for the first " versions. (ot all editors have their :een understanding of
$omutersB softwareB te=tsB studentsB and rofessors. 0ithout this understanding
and visionB POM-QM for Windows would still )e a vision rather than a realit3.
#3 $urrent editorsB #ar: Pfalt?graf and 6lana 9radle3 have )een instrumental in
getting this version to mar:et. ,ellow Prenti$e Hall authors in$luding 9arr3
RenderB Ralh StairB 'hu$: Ta3lorB and >a3 Hei?er have heled me to ma:e the
transition from the original *OS rodu$t to the $urrent 0indows rodu$ts and to
imrove the 0indows rodu$t. I am grateful for their man3 suggestions and the
fa$t that the3 $hose m3 software as the software to a$$oman3 their te=ts. The
suortB en$ouragementB and hel from all of these eole are ver3 mu$h
are$iated. (an$3 0el$her rovides the suort of the Prenti$e Hall we) ages
that are maintained for these rodu$ts. ,inall3B I would li:e to e=ress m3
are$iation to *e))ie 'lare who has )een the mar:eting manager for m3
software.
6s alwa3sB I must e=ress m3 are$iation and love to m3 wifeB 2u$iaB for her
understanding and suort during the man3 hours that $ontinue to send in front of
m3 P'. In additionB I am grateful for the valua)le $omments and suggestions
regarding the loo: and feel of the software from 2u$ia and m3 $hildrenB +rnie and
2isa.
.hapter /
Introduction
Overview
0el$ome to Prenti$e4HallEs *e$ision S$ien$e software a$:ageC POM-QM for
Windows (a.:.a. POM for Windows and QM for Windows). This a$:age is the
most user4friendl3 software a$:age availa)le in the fields of rodu$tion and
oerations managementB quantitative methodsB management s$ien$eB or oerations
resear$h. POM-QM for Windows has )een designed to hel 3ou to )etter learn and
understand these fields. The software $an )e used either to solve ro)lems or to
$he$: answers that have )een derived )3 hand. POM-QM for Windows $ontains a
large num)er of modelsB and most of the homewor: ro)lems in PO# te=t)oo:s
or 5# te=t)oo:s $an )e solved or aroa$hed using POM-QM for Windows.
In this introdu$tion and the ne=t four $hatersB we des$ri)e the general features of
the software. 0e en$ourage 3ou to read them while running the software on 3our
$omuter. 'hater " $ontains the des$rition of the se$ifi$ models and
ali$ations availa)le in POM-QM for Windows.
Hou will find that the software is ver3 user4friendl3 due to the following featuresC
Standardi8ation
The grahi$al user interfa$e for the software is a standard 0indows
interfa$e. 6n3one familiar with an3 standard sreadsheetB word ro$essorB
or resentation a$:age in 0indows will easil3 )e a)le to use the software.
This standard interfa$e in$ludes the $ustomar3 menuB tool)arB status )arB
and hel files of 0indows rograms.
+ven though the software $ontains &- modules and more than "/
su)modelsB the s$reens for ever3 module are $onsistentB so that after 3ou
)e$ome a$$ustomed to using one module 3ou will have an eas3 time with
the other modules.
,ile storage and retrieval is simle. ,iles are oened and saved in the usual
0indows fashion andB in additionB files are named )3 moduleB whi$h ma:es
it eas3 to find reviousl3 saved files.
1
PO#45# for 0indows
*ata and resultsB in$luding grahsB $an )e easil3 $oied and asted )etween
this ali$ation and other 0indows ali$ations.
F%e9i-i%it5
The s$reen $omonents and the $olors $an )e $ustomi?ed )3 the user. This
$an )e arti$ularl3 effe$tive on overhead data shows.
The user $an sele$t the desired outut to rint rather than having to rint
ever3thing. In additionB several rint formatting otions are availa)le.
There are several referen$es that the user $an sele$t from the HelB Aser
Information menu. ,or e=amleB the software $an )e set to automati$all3
save a file after data has )een entered and;or to automati$all3 solve a
ro)lem after data has )een entered.
6ser-oriented desin
The sreadsheet4t3e data editor ma:es data entr3 and editing e=tremel3
eas3. In additionB whenever data is to )e enteredB there is a $lear instru$tion
given on the s$reen des$ri)ing what is to )e enteredB and when data is
entered in$orre$tl3 a $lear error message is disla3ed.
It is eas3 to $hange from one solution method to another in order to
$omare methods and answers. In several $asesB this is siml3 a one4$li$:
oeration. In additionB intermediate stes are generall3 availa)le for disla3.
The disla3 has )een $olor $oded so that answers will aear in a different
$olor from data.
,e9t-oo7 custo!i8ation
The software $an )e $ustomi?ed to Prenti$e4Hall te=t)oo:s in order that the
modelsB notation and disla3s will mat$h the arti$ular te=t)oo:.
&
6ser support
Adates are availa)le on the Internet through the Prenti$e Hall 0e) site for
this )oo:B httC;;www.renhall.$om;weissB andB hel is availa)le )3
$onta$ting dsSoftwareDrenhall.$om.
0hat all of this means to 3ou is that with a minimal investment of time in learning
the )asi$s of POM-QM for Windows, 3ou will have a ver3 eas34to4use means for
solving ro)lems or for $he$:ing 3our homewor:. Rather than )eing limited to
loo:ing at the answers in the )a$: of 3our te=t)oo:B 3ou will )e a)le to see the
solutions for most ro)lems. In man3 $asesB the intermediate stes are disla3ed in
order to hel 3ou $he$: 3our wor:. In additionB 3ou will have the $aa)ilit3 to
erform sensitivit3 anal3sis on these ro)lems or to solve )iggerB more interesting
ro)lems.
"ardware and Software Re:uire!ents
.o!puter
The software has minimal s3stem requirements. It will run on an3 I9# P'
$omati)le Pentium ma$hine with at least 1 #9 R6# and oerating 0indows
&///B 0indows (TB 0indows #+ or 0indows IP.
Dis7 Drives&.D-ROM
The software is rovided on a '*. This requires a '*4RO# drive.
Monitor
The software has no se$ial monitor requirements. *ifferent $olors are used to
ortra3 different items. 6ll messagesB oututB dataB et$. will show u on an3
monitor. Regardless of the t3e of monitor that 3ou are usingB the software has the
$aa)ilit3 that allows 3ou to $ustomi?e $olors and;or fonts and font si?es in the
disla3 to 3our li:ing. This is e=tremel3 useful when using an overhead ro@e$tion
s3stem. These otions are e=lained in 'hater 3 in the se$tion entitled ,ormat.
Printer
6 rinter is not required to run the software )utB of $ourseB if 3ou want a hard $o3
7rintout8 then it is ne$essar3 to have a rinter atta$hed. The rinting is standard so
that no se$ial featuresB $hara$tersB or rinters are required. It also is ossi)le to
rint to a file in order to imort the rintout into a word ro$essor for further
editing.
,5poraphic .onventions in this Manua%
3
PO#45# for 0indows
0hen we use )oldfa$eB we are indi$ating something that 3ou t3e or ress.
0hen we use a )ra$:etB ; <B we are naming a :e3 on the :e3)oard or a $ommand
)utton on the s$reen. ,or e=amle ;F/< means ,un$tion :e3 ,1B while ;O=< means
the JO:a3E )utton on the s$reen.
0e will use ;Return<B ;4nter<B or ;Return&4nter< to mean the :e3 on 3our
:e3)oard that has one of those names. The name of the :e3 varies on different
:e3)oards and some even have )oth :e3s.
0e will use )oldfa$e and $aitali?e onl3 the first letter to refer to a 0indows
menu $ommand. ,or e=amleB Fi%e refers to the menu $ommand.
!. 0e will use all $aitals to refer to a tool)ar $ommand su$h as SO2.+.
Insta%%in the Software
0e assume in the dire$tions that follow that the hard drive is named 'C and that
the '*4RO# is drive *C. The software is installed in the manner that most
rograms designed for 0indows are installed. ,or all 0indows installationsB
in$luding this oneB it is )est to )e $ertain that no rograms are running while 3ou
are installing a new one.
Insert the '* with POM-QM for Windows in drive *C. 6fter a little while the
installation rogram should )egin automati$all3. If it does not thenC
,rom the 0indows Start 9utton sele$tB Run.
9rowse the '* for D:setup$po!:!v($e9e 7$ase does not matter8.
Press ;4nter< or $li$: on ;O=<$
,ollow the setu instru$tions on the s$reen. Generall3 sea:ingB it is siml3
ne$essar3 to $li$: ;N4>,< ea$h time that the installation as:s a question.
*efault values have )een assigned in the setu rogramB )ut 3ou ma3 $hange them
if 3ou li:e. The default folder is 'CKProgram ,ilesKPO#5#.3.
The setu rogram will as: 3ou for registration information su$h as 3our nameB
universit3B rofessorB and $ourse. 6ll items are otional e=$et for the student;user
name that must )e given. This name cannot be changed later To $hange the other
information from within the rogramB use "e%p, 6ser Infor!ation.
If 3ou have the '* from the O!erations Management, "e te=t)oo: )3 Hei?er and
Render the software will automati$all3 )e installed as POM for Windows and
$ustomi?ed to the te=t)oo:. In the futureB if 3ou have other Prenti$e4Hall *e$ision
S$ien$e te=t)oo:s then the software will )e on the '* in the )a$: of the te=t)oo:
4
and the rogram will )e will )e $ustomi?ed to the te=t)oo:. If 3ou have the POM-
QM for Windows '* 3ou $an $ustomi?e the software to the te=t)oo:s )3 using
"e%p, 6ser Infor!ation$
One otion that the installation will question 3ou a)out is whether or not 3ou want
to )e a)le to run the rogram )3 dou)le $li$:ing on the file name in ,ile +=lorer.
If 3ou sa3 3esB then the rogram will asso$iate the roer e=tensions with the
rogram name. This is generall3 ver3 useful.
Please note that the software installs some files to the 0indows S3stem dire$tor3.
The installation will )a$: u an3 files that are rela$ed if 3ou sele$t this otion.
If 3ou see a message sa3ing that something is wrong during installation and 3ou
have the otion of ignoringB then $hoose this otion. The rogram will li:el3
install roerl3 an3wa3. The message usuall3 indi$ates that 3ou are running a
rogram or have run a rogram that shares a file with this software a$:age. If 5ou
have an5 insta%%ation or operation pro-%e!s the first p%ace to chec7 is the
down%oad pae at www$prenha%%$co!&weiss$
Insta%%in and Runnin on a Networ7
0ith the written ermission of Prenti$e HallB it is per!issi-%e to insta%% the
software to a networ7 on%5 if each student has purchased an individua% cop5 of
the software$ That isB ea$h student must ossess his or her own li$ensed $o3 of
the '* in order to install the software on a networ:.
,he Prora! 2roup
The installation will add a rogram grou with four items to the Start #enu. The
names of the items 7PO#B 5# or PO#45#8 deend on whether the '* is from
the )a$: of the te=t)oo: or is a stand4alone '*.
Hel is availa)le from within the rogramB )ut if 3ou want to read some
information a)out the rogram without starting it firstB use the POM-QM for
Windows # $el! i$on.
The rogram grou $ontains one i$on named Prentice $all Web Site %atewa&. If
3ou have an asso$iation for HT#2 files with a 0e) )rowser 7e.g.B (ets$ae or
Internet +=lorer8B this do$ument will oint 3ou to rogram udates.
!
PO#45# for 0indows
,inall3B the software $omes with a (ormal *istri)ution 'al$ulator. The $al$ulator
is on the Tools menu of the rogram )ut also $an )e used as a stand alone rogram
without having to oen POM-QM for Windows.
To uninstall the rogram use the usual 0indows uninstall ro$edure 7Start,
Settins, .ontro% Pane%, 0dd&Re!ove Prora!s8. The rograms will )e
removed )ut the data files will notF the3 will have to )e deleted using #3
'omuter or ,ile +=lorer if 3ou wish to do so.
In addition to the Start #enuB the installation will la$e a short$ut to the rogram
on the des:to. The i$on will )e one of the three i$ons disla3ed )elow deending
on the e=a$t '* )eing used. 0hi$hever des:to i$on has )een installed is the i$on
that $an )e used to easil3 )egin the rogram.

Startin the Prora!
The easiest wa3 to start the rogram is )3 dou)le4$li$:ing the rogram i$on that is
on the des:to. 6lternativel3B 3ou ma3 use the standard 0indows means for
starting the rogram. 'li$: on StartB Prora!sB POM-QM for Windows (B
POM-QM for Windows ( in order to use the software. 6fter starting the rogramB
a slash s$reen will aear as disla3ed on the ne=t age.
Na!e
The name of the li$ensee will aear in the disla3. This should )e 3our name if
3ou are running on a stand4alone $omuter or the networ: name if 3ou are running
on a networ:.
"
?ersion Nu!-er
One imortant ie$e of information is the version num)er of the software. In the
e=amleB the .ersion is 3./ and this manual has )een designed around that
num)er. 0hile this is .ersion 3./ there is also more detailed information a)out
the rogram version that $an )e found using "e%p, 0-out 7disla3ed at the ver3
end of 'hater 38. In arti$ularB there is a )uild num)er. If 3ou send e4mail as:ing
for te$hni$al suortB 3ou should in$lude the )uild num)er with the e4mail.
NO,4: If the rogram has )een registered as )eing in a u)li$ la) or on a networ:
then at this oint the oening s$reen will $hange and give 3ou the oortunit3 to
enter 3our name. This is useful when 3ou rint 3our results.
The rogram will start in a $oule of se$onds after the oening disla3 aears.
,he Main Screen
The se$ond s$reen that aears is an emt3 main menu s$reen. The first time that
this s$reen aearsB a Ti of the *a3 form will aear as disla3ed )elow. If 3ou
donEt want the Ti of the *a3 to show u ea$h timeB then un$he$: the )o= at the
lower left of the form. If 3ou $hange 3our mind later and want to see the Ti of the
*a3B then go to the "e%p menu.
%
PO#45# for 0indows
Please noti$e the )a$:ground in the middle of the s$reen. This is referred to as a
gradient. This gradient aears whenever the main s$reen is emt3 and it aears
on other s$reens in the software. Hou ma3 $ustomi?e the disla3 of the gradient )3
using For!at, .o%ors as e=lained in 'hater 3.
6fter $losing the Ti of the *a3B or if 3ou have $hosen not to see the tisB the ne=t
s$reen is the module sele$tion s$reen 7shown in 'hater &8. In order to disla3 all
of the s$reen $omonentsB we have sele$ted a module and loaded a data file.
1
The to of the s$reen is the standard 0indows title )ar for the window. 6t the
)eginning the title is POM-QM for Windows 7or POM for Windows or QM for
Windows8. If 3ou are using a Prenti$e Hall te=t then the names of the authors of
the te=ts should aear in this title )ar at the )eginning of the rogram as shown in
the figure on the revious age. 7If notB go to "e%p, 6ser Infor!ation.8 The title
)ar will $hange to in$lude the name of the file when a file is loaded or saved as
shown a)ove. On the left of the title )ar is the standard 0indows $ontrol )o= and
on the right are the standard minimi?eB ma=imi?eB and $lose )uttons for the
window4si?ing otions.
9elow the title )ar is a )ar that $ontains the #ain #enu. The menu )ar is ver3
$onventional and should )e eas3 to use. The details of the menu otions of Fi%e,
4dit, ?iew, Modu%e, For!at, ,oo%s, Window, and "e%p are e=lained in 'hater
3. 6t the )eginning of the rogramB the 4dit otion is not ena)ledB as there is no
data to edit. The Window otion is also disa)ledB sin$e this refers to results
windows and we have no results. 0hile the menu aears in the standard
0indows osition at the to of the s$reenB it $an )e moved if 3ou li:e )3 $li$:ing
on the handle on the left and dragging the mouse.
9elow the menu is a standard tool)ar 7also $alled a )utton )ar or ri))on8. This
tool)ar $ontains short$uts for several of the most $ommonl3 used menu
$ommands. If 3ou move the mouse over the tool for a)out two se$ondsB an
-
PO#45# for 0indows
e=lanation of the tool 7)alloon hel8 will aear on the s$reen. 6s with most
software a$:agesB the tool)ar $an )e hidden if 3ou so $hoose 7right $li$: on an3
of the tool)ars or use ?iew, ,oo%-ars, .usto!i8e8. Hiding the tool)arB allows for
more room on the s$reen for the ro)lems. 6s is the $ase with most tool)arsB we
allow the tool)ar to float. In order to reosition an3 of the tool)arsB siml3 $li$:
on the handle on the left and drag.
One ver3 imortant tool on the standard tool)ar is the SO2.+ tool on the far
right of the tool)ar. This is what 3ou ress after 3ou have entered the data and 3ou
are read3 to solve the ro)lem. 6lternativel3B 3ou ma3 use Fi%e, So%ve or ress the
;F@< :e3. Please note that after ressing the SO2.+ toolB this tool will $hange to
an +*IT tool. This is how 3ou go )a$: and forth from entering data to viewing
the solution. ,or two modulesB linear rogramming and transortationB there is one
more $ommand that will aear on the standard tool)ar. This is the ST+P tool
7not disla3ed in the figure8B and it ena)les 3ou to ste through the iterationsB
disla3ing one iteration at a time.
9elow the standard tool)ar is a format tool)ar. This tool)ar is ver3 similar to the
tool)ars found in +=$elB 0ordB and 0ordPerfe$t. It too $an )e $ustomi?edB movedB
hiddenB or floated.
There is one more tool)arB and its default lo$ation is at the )ottom of the s$reen.
This )ar is a utilit3 )ar and it $ontains si= tools. The tool on the left is named
#O*A2+. 6 module list $an aear in two wa3s 4 either )3 using this tool or the
Modu%e otion on the main menu. The ne=t tool is named PRI(T S'R++(B and it
is there to emulate the old rint s$reen fun$tion in *OS. The ne=t two tools will
load files in alha)eti$al order either forward or )a$:wards. This is ver3 useful
when reviewing a num)er of ro)lems in one $hater su$h as the samle files that
a$$oman3 this manual. The two remaining tools allow files to )e saved as +=$el
or HT#2 files.
In the $enter are two areasB one of whi$h is the main data ta)le. The ta)le $ontains
a heading or title and then siml3 rows and $olumns. The num)er of rows and
$olumns deends on the moduleB ro)lem t3eB and se$ifi$ ro)lem. The large
1/
area with no grid is the ta)le )a$:ground. The $ation $olorsB ta)le $olors and
)a$:ground $olor $an )e $hanged )3 using For!at, .o%ors, as e=lained in
'hater 3.
6)ove the data ta)le is an area named the e=tra data )ar for la$ing e=tra ro)lem
information. Sometimes it is ne$essar3 to indi$ate whether to minimi?e or
ma=imi?eB sometimes it is ne$essar3 to sele$t a methodB and sometimes some value
must )e given. These generall3 aear a)ove the data. On the right of the e=tra
data anel is an instru$tion anel. There is alwa3s an instru$tion here to hel 3ou
to figure out what to do or what to enter. 0hen data is to )e entered into the data
ta)leB this instru$tion will e=lain what t3e of data 7integerB realB ositiveB et$.8 is
to )e entered. The instru$tion lo$ation $an )e $hanged )3 using the ?iew otion.
There also is a form for annotating ro)lems. 6 $omment ma3 )e la$ed here.
0hen the file is savedB the information will )e savedF when the file is loadedB the
information will aear and the annotation ma3 )e rinted if so desired.
Towards the )ottom of the s$reen is the status anel. The leftmost anel will
disla3 the module and su)model name as 3ou sele$t different modulesB as
e=emlified in this illustration where the module is ,ore$asting and the su)model
is Time Series 6nal3sisL. The $enter anel $ontains the t3e of s$reen 7dataB
resultsB menuB grahB et$.8 and the rightmost anel has the te=t)oo: name 7if a
te=t)oo: has )een sele$ted8. The status )ar $an )e hidden )3 using the ?iew
otion. This anel $an not )e moved.
11
PO#45# for 0indows
.hapter *
0 Sa!p%e Pro-%e!
Introduction
In this $haterB we will run through a samle ro)lem from )eginning to end in
order to demonstrate how to use the a$:age. 0hile not all ro)lems or modules
are identi$alB there is enough similarit3 that seeing one e=amle will ma:e it ver3
eas3 to use an3 module in this software. 6s we mentioned in the introdu$tionB the
first instru$tion is to sele$t a module to )egin the wor:.

In the a)ove figureB we disla3 the modules as the3 are listed when 3ou use the
#O*A2+ tool on the utilit3 )ar 7as oosed to the Modu%e otion in the main
menu at the to8. 6s 3ou $an seeB there are &- modules availa)le. The3 are divided
into three grous. The models in the first grou t3i$all3 are in$luded in all PO#
and 5# )oo:sB while the models in the se$ond grou t3i$all3 aear onl3 in
PO# )oo:s and the models in the third grou aears onl3 in 5# te=ts. The
models are divided in this fashion so that 3ou will understand it is $omletel3 fine
to ignore PO# onl3 modules if 3ou have a 5# $ourse and vi$e4versa.
If 3ou $hoose the Modu%e otion from the #ain #enuB 3ou get the same modules
listed in a single list in alha)eti$al order. 7This is disla3ed in 'hater 3.8 Hou
'hater &C 6 Samle Pro)lem
have the otion on this menu to disla3 onl3 the PO# modules or onl3 the 5#
modules.
.reatin a New Pro-%e!
Generall3B the first menu otion that will )e $hosen is Fi%eB followed )3 either
New to $reate a new data set or Open to load a reviousl3 saved data set. In the
figure that followsB we show the $reation s$reen that is used when a new ro)lem
is started. O)viousl3B this is an otion that will )e $hosen ver3 often. The $reation
s$reens are similar for all modulesB )ut there are slight differen$es that 3ou will
see from module to module.
The to line $ontains a te=t )o= into whi$h the title of the ro)lem $an )e entered.
The default title for ro)lems is initiall3 M7untitled8L. The default title $an )e
$hanged )3 ressing the )utton NModif5 Defau%t ,it%eO. ,or e=amleB if 3ou
$hange the default title to MHomewor: Pro)lemL then ever3 time 3ou start a new
ro)lem the title will aear as Homewor: Pro)lemB and 3ou would siml3 need
to add the ro)lem num)er to $omlete the title. If 3ou want to $hange the title
after $reating the ro)lemB this $an easil3 )e done )3 using the For!at, ,it%e
otion from the main menu )ar or from the tool)ar.
,or man3 modulesB it is ne$essar3 to enter the num)er of rows in the ro)lem.
Rows will have different names deending on the module. ,or e=amleB in linear
rogrammingB rows are M$onstraintsLB while in fore$astingB rows are Mast
eriodsL. 6t an3 rateB the num)er of rows $an )e $hosen with either the s$roll )ar
or the te=t )o=. 6s is usuall3 the $ase in 0indowsB the3 are $onne$ted. 6s 3ou
move the s$roll )arB the num)er in the te=t )o= $hangesF as 3ou $hange the te=tB
the s$roll )ar moves. In generalB the ma=imum num)er of rows in an3 module is
PO#45# for 0indows
-/. There are three wa3s to add or delete rows or $olumns after the ro)lem has
)een $reated. Hou ma3 use the otions in the 4dit menuB 3ou ma3 right $li$: on
the data ta)le whi$h will )ring u )oth $o3 and insert;delete otions orB to insert
a row or insert a $olumn B 3ou ma3 use the tools on the tool)ar.
This rogram has the $aa)ilit3 to allow 3ou different otions for the default row
names. Sele$t one of the si= otion )uttons in order to indi$ate whi$h st3le of
default naming should )e used. In most modulesB the row names are not used for
$omutationsB )ut 3ou should )e $areful )e$ause in some modules 7most nota)l3
Pro@e$t #anagement and #RP8 the names might )e relevant to the $omutations.
In most modulesB the row names $an )e $hanged )3 editing the data ta)le.
#an3 modules require a num)er of $olumns. This is given in the same wa3 as the
num)er of rows. The rogram gives 3ou a $hoi$e of default values for $olumn
names in the same fashion as row names )ut on the ta) named 'olumn (ames.
0e have added an overview ta) to the $reation s$reen in this version of the
software. The overview ta) gives a )rief des$rition of the models that are
availa)le and also gives an3 imortant information regarding the $reation or data
entr3 for that module.
Some modulesB su$h as the linear rogramming e=amle disla3ed on the revious
ageB will have an e=tra otion )o=B su$h as for $hoosing minimi?e or ma=imi?e or
sele$ting whether distan$es are s3mmetri$ or not. Sele$t one of these otions. In
most $asesB this otion $an )e $hanged later on the data s$reen.
0hen 3ou are satisfied with 3our $hoi$esB $li$: on the ;O=< )utton. 6t this ointB
a )lan: data s$reen will aear as given in the following figure. S$reens will differ
module )3 module )ut the3 will all resem)le the s$reen on the following age.
'hater &C 6 Samle Pro)lem
,he Data Screen
The data s$reen was des$ri)ed )riefl3 in 'hater 1. It has a data ta)le andB for
man3 modelsB there is e=tra information that aears a)ove the data ta)le as shown
in the figure )elow.
4nterin and 4ditin Data
6fter a new data set has )een $reated or an e=isting one has )een loadedB the data
$an )e entered or edited. +ver3 entr3 is in a row and $olumn osition. Hou
navigate through the sreadsheet using the $ursor movement :e3s 7or the mouse8.
These :e3s fun$tion in a regular wa3 with one ver3 useful e=$etion 4 the ;4nterO
:e3.
The ;4nter< :e3 ta:es 3ou to the ne=t $ell in the ta)leB first moving to the right and
then moving down. 0hen a row is finishedB the ;4nter< :e3 goes to the first $ell in
the ne=t row that $ontains data rather than a row name. ,or e=amleB in the s$reen
a)oveB if 3ou are at the end of the row named MSour$e 1P and 3ou ress ;4nter<B
the $ursor will move to the $ell with a M/P in the ne=t row. It is ossi)le to set the
$ursor to go to the first $ellB the one with the name in itB )3 using "e%p, 6ser
Infor!ation$
PO#45# for 0indows
In additionB if 3ou use the ;4nter< :e3 to enter the dataB after 3ou are done with
the last $ell the rogram will automati$all3 solve the ro)lem 7saving 3ou the
trou)le of $li$:ing on the SO2.+ tool8. This )ehavior $an )e ad@usted )3 using
"e%p, 6ser Infor!ation andB in additionB if 3ou want the rogram to
automati$all3 romt 3ou to save the file when 3ou are done entering dataB this
too $an )e a$$omlished through "e%p, 6ser Infor!ation$
The instru$tion frame on the s$reen will $ontain a )rief instru$tion des$ri)ing what
is to )e done. There are essentiall3 three t3es of $ells in the data ta)le.
One t3e is a regular data $ell into whi$h 3ou enter either a name or a num)er.
0hen entering names and num)ersB siml3 t3e the name or num)erF then ress
the ;4nter< :e3 or one of the dire$tion :e3s or $li$: on another $ell. If 3ou t3e an
illegal $hara$terB a message )o= will )e disla3ed indi$ating so.
6 se$ond t3e is a $ell that $annot )e edited. ,or e=amleB the emt3 $ell in the
uer left hand $orner of the ta)le $an not )e edited. 7Hou a$tuall3 $ould aste
into the $ell.8
6 third t3e is a $ell that $ontains a dro4down )o=. ,or e=amleB the signs in a
linear rogramming $onstraint are $hosen from this t3e of )o=B as shown in the
following illustration. To see all of the otionsB ress the arrow on the dro4down
)o=.
0hen 3ou are finished entering the dataB ress the SO2.+ tool on the tool)ar or
use ;F@< or Fi%e, So%ve and a solution s$reen will aear as given in the following
illustration. The original data is in )la$: and the solution is in a $olor. Of $ourseB
these are onl3 the default valuesB as all $olors ma3 )e set )3 using For!at,
.o%ors.
,he So%ution Screen
6n imortant thing to noti$e is that there is more solution information availa)le
than the one ta)le disla3ed. This $an )e seen )3 the i$ons given at the )ottom.
'li$: on these to view the information.
6lternativel3B when 3ou solve the ro)lemB the form )elow $an )e set to aear on
to of the solution through "e%p, 6ser Infor!ation.

If 3ou $li$: on the OPTIO(S )utton then 3ou $an set u the )ehavior of the
software when a ro)lem is solved. The otions are as followsC
The first otion will siml3 disla3 the solution. The ne=t three otions are there
to remind 3ou that more results ma3 e=ist than the one window )eing disla3ed.
The se$ond otion will disla3 the Solutions 0indow whi$h $ontains a )rief
des$rition of ea$h solution 0indow. The third otion will automati$all3 dro
down the 0indow menu. These otions $an )e rest using "e%p, 6ser
Infor!ation$
It is generall3 at this oint thatB after reviewing the solutionB 3ou would $hoose to
rint )oth the ro)lem and solution.
(ow that we have e=amined the $reation and solution of a ro)lemB we e=lain all
of the otions that are availa)le in the #ain #enu.
.hapter (
,he Main Menu
Fi%e
Fi%e $ontains the usual otions that one finds in most 0indows rogramsB as seen
in the figure that follows.
These otions are now des$ri)ed.
New
6s demonstrated in the samle ro)lemB this otion is $hosen to )egin a new
ro)lem;file. In some $asesB 3ou will go dire$tl3 to the ro)lem $reation s$reenB
while in other $ases a o4u menu will aear indi$ating the su)models that are
availa)le. 6fter sele$ting a su)modelB 3ou will go to the $reation s$reen.
Open
This is used to oen;load a reviousl3 saved file. ,ile sele$tion is the standard
0indows $ommon dialog t3e. 6n e=amle of the s$reen for oening a file is
shown )elow. (oti$e that the e=tension for files in the software s3stem is given )3
the first three letters of the module name 7The e=$etions are assem)l3 line
)alan$ing 7Q.)al8 and la3out 7Q.oe8 due to $onventions in revious versions and
rodu$tivit37Q.rd8 to avoid a $onfli$t with ro@e$t management.8. ,or e=amleB all
transortation files have the e=tension Q.tra. 0hen 3ou go to the Oen ,ile dialogB
the default value is for the rogram to loo: for files of the t3e in this module.
This $an )e $hanged at the )ottom leftB where it sa3s M,iles of t3e.L OtherwiseB
file oening and saving is quite normal. The drive or folder $an )e $hanged with
the drive;folder dro4down )o=B a new dire$tor3 ma3 )e $reated using the new
)utton at the toB and details a)out the files ma3 )e seen )3 using the details
)utton at the to right.
It is ossi)le to use "e%p, 6ser Infor!ation to set the rogram to automati$all3
solve an3 ro)lem when it gets loaded. This wa3B if 3ou li:eB 3ou $an )e loo:ing
at the solution s$reen whenever 3ou load a ro)lem rather than at the data s$reen.
Save
Save will rela$e the file without as:ing 3ou if 3ou $are a)out overwriting the
revious version of this file. If 3ou tr3 to save and have not reviousl3 named the
fileB 3ou will )e as:ed to name this file.
The names that are legal are standard 0indows file names. In addition to the file
nameB 3ou ma3 refa$e the name with a drive letter 7with its $olon8 or ath
designation. The software will automati$all3 aend an e=tension to the name that
3ou use. 6s mentioned a)oveB the e=tension is the first three letters of the module
name. Hou ma3 t3e file names in as uer$aseB lower$aseB or mi=ed. +=amles of
legal file names are
samleB samle.traB $Cm3,ileB $CKm3'ourseKtestB and m3ro)lem.e=amle.
If 3ou enter samle.tra and the module is not transortationB then an e=tension will
)e added. ,or e=amleB if the module is linear rogrammingB then the name under
whi$h the file will )e saved will )e samle.tra.lin.
Save as
Save as will romt 3ou for a file name )efore saving. This otion is ver3 similar
to the otion to load a data file. 0hen 3ou $hoose this otionB the 0indows
'ommon *ialog 9o= for ,iles will aear. It is essentiall3 identi$al to the one
reviousl3 shown for oening files.
Save as 49ce% Fi%e
The software has an otion that allows 3ou to save most 7)ut not all8 of the
ro)lems as +=$el files. The data is transorted to +=$el and the sreadsheet is
filled with formulas for the solutions. In some $asesB +=$elEs Solver ma3 )e
required in order to get the solution.
,or e=amleB given )elow is the outut from a waiting line model. The left4hand
side has the data while the right4hand side has the solution. (oti$e the $olor4
$oding of answer vis4R4vis data.
6fter saving as an +=$el fileB the +=$el file aears )elow. (oti$e from the
formula for $ell +% 7shown at the to of the sreadsheet8 that a sreadsheet with
formulas was $reated. That isB we did not M$ut and asteL the a)ove s$reen into
+=$el 7whi$h is ossi)le8 )ut instead $reated an +=$el sreadsheet with
aroriate formulas.

Save as ",MA Fi%e
6n3 ta)leB either data or solutionB ma3 )e saved as an HT#2 fileB as shown )elow.
If more than one ta)le is on the s$reen at the time that this otion is sele$tedB then
the a$tive ta)le is the one that is saved.
Print
Print will disla3 a Print Setu s$reen. Printing otions are des$ri)ed in 'hater
4. 9oth Save and Print will a$t slightl3 differentl3 if a grah is )eing disla3ed at
the time that 3ou use Print or Save.
Print Screen
This will rint the s$reen as it aears. *ifferent s$reen resolutions ma3 affe$t the
rinting. Printing the s$reen is more time $onsuming than a regular rint. Ase this
otion if 3ou need to demonstrate to 3our instru$tor e=a$tl3 what was on the
s$reen at the time.
So%ve
There are several wa3s to solve a ro)lem. 'li$:ing on Fi%e, So%ve is ro)a)l3 the
least effi$ient wa3 to solve the ro)lem. The tool)ar i$on ma3 )e usedB as well as
the ;F@< :e3. 6lsoB if the data is entered in order 7to to )ottomB left to rightB using
;4nter<8B the rogram will solve the ro)lem automati$all3 after the last $ell.
6fter solvingB the So%ve otion will $hange to an 4dit otion on )oth the menu
and the tool)ar. This is the wa3 to go )a$: and forth )etween data and solutions.
(ote that "e%p, 6ser Infor!ation ma3 )e used to set the rogram to
automati$all3 ma=imi?e the solution windows if so desired.
49it

The ne=t otion on the Fi%e menu is 49it. This will e=it the rogram. Hou will )e
as:ed if 3ou want to e=it the rogram. Hou $an eliminate this question )3 using
"e%p, 6ser Infor!ation$
Aast Four Fi%es
The Fi%e menu $ontains a list of the last four files that 3ou have used. 'li$:ing on
one of these will load the file.
4dit
The $ommands under 4dit $an )e seen in the following illustration. Their
uroses are threefold. The first si= $ommands are used to insert or delete rows or
$olumns. The se$ond t3e of $ommand is useful for reeating entries in a $olumnB
and the third t3e is for $utting and asting )etween 0indows ali$ations. It is
also ossi)le to ena)le the insert;delete and $o3 otions )3 right $li$:ing on the
data or solution ta)le.
1Insert Row will insert a row after the $urrent rowB and Insert .o%u!n will
insert a $olumn after the $urrent $olumn. Insert RowsBsC and Insert .o%u!nsBsC
ena)le 3ou to insert multile rows or $olumns. De%ete Row will delete the $urrent
rowB and De%ete .o%u!n will delete the $urrent $olumn.
.op5 4ntr5 Down .o%u!n
This $ommand is used to $o3 an entr3 from one $ell to all $ells )elow it in the
$olumn. This is not often usefulB )ut it $an save a great deal of wor: when it is.
.op5
'o3 has five otions availa)le. It is ossi)le to $o3 the entire ta)leB the $urrent
rowB or the $urrent $olumn to the $li)oard. It is ossi)le to $o3 from the data
ta)le or an3 of the solution ta)les. 0hatever is $oied $an then )e asted into this
rogram or some other 0indows rogram. 7The $o3 tool in the tool)ar $oies
the entire ta)le.8 If 3ou are at the solution stageB the $o3ing will )e for the ta)le
that is a$tive.
'o3 Se$ial will $o3 the entire ta)le )ut ena)le 3ou to limit the num)er of
de$imals that are $oied. Save as HT#2 will erform the HT#2 oeration that
was reviousl3 des$ri)ed.
Paste
Paste is used to aste in the $urrent $ontents of the $li)oard. 0hen asting into
POM-QM for Windows, the asting )egins at the $urrent $ursor osition. ThusB it
is ossi)le to $o3 a $olumn to a different $olumn )eginning in a different row.
This $ould )e done to $reate a diagonal. It is not ossi)le to aste into a solution
ta)leB althoughB as indi$ated reviousl3B it is ossi)le to $o3 from a solution ta)le.
/NO,4: Right4$li$:ing on an3 ta)le will )ring u 'o3 otions and if the ta)le is
the data ta)le it will also )ring u the insert and delete otions.
?iew
?iew has several otions that ena)le 3ou to $ustomi?e the aearan$e of the
s$reen.
The ,oo%-ars menu $ontains two otions. The tool)ar $an )e $ustomi?ed 7as $an
most 0indows tool)ars8 or the tool)ar $an )e reset to its original loo:.
The Instruction )ar $an )e disla3ed at its default lo$ation in the e=tra data anel
or a)ove the dataB or )elow the dataB or as a floating windowB or not at all. The
Status Dar disla3 $an )e toggled on or off.
Fu%% Screen will turn all of the )ars 7tool)arB $ommand )arB instru$tionB and
status )ar8 on or off.
Eoo! will generate a small form allowing 3ou to redu$e or in$rease the si?e of the
$olumns. It is easier to use the ?oom tool on the standard tool)ar.
'olors $an )e set to Monochro!e 7)la$: and white8 or from this state to their
Oriina% .o%ors. This formerl3 was ver3 useful when overhead devi$es disla3ed
mu$h )etter in mono$hrome than in $olor. Toda3B the ro@e$tors are so owerful
that mono$hrome is generall3 not required.
Modu%e
6 dro4down list with all of the modules in alha)eti$al order will aear. The
#O*A2+ tool on the utilit3 tool)ar )elow the data area is a se$ond wa3 to get a
list of modules. 6t the )ottom of the list are otions for indi$ating whether 3ou
want to disla3 onl3 the PO# modules 7as disla3ed8B onl3 the 5# modules or all
of the modules.
For!at
For!at has several otions for the disla3 of data and solution ta)lesB as $an )e
seen in the following illustration. In additionB there are some additional format
otions availa)le in the format tool)ar.
.o%ors
The $olors for all of the disla3s $an )e set. There are five ta)s as shown )elow.
These otions will $reate ermanent $hanges whereas the foreground and
)a$:ground tools on the format )ar will $hange onl3 the $urrent ta)le.
,urthermoreB the $olor settings are for the entire ta)leB while the format tools ma3
)e used for either the entire ta)le or for sele$ted $olumns.
The first ta) is for setting the $olors in the data ta)leB and the se$ond ta) is for
setting the $olors in the solution ta)les. That isB it is ossi)le to have the disla3s
of the data and the disla3 of the results aear differentl3B whi$h $an )e helful.
,or either the data or the resultsB 3ou ma3 set the )a$:ground and foreground
$olors for rows to alternate )3 using the odd and even otions. This ma:es reading
long ta)les easier.
In order to set the $olorsB first sele$t the ta)le roert3 that 3ou want to setB then
sele$t foreground or )a$:ground if ali$a)leB then sele$t rows if ali$a)le and
then $li$: on the $olor. ,or e=amleB $li$: on Dod5, Foreround, Odd and then
$li$: on the red $olor )o= and the foreground for ever3 other row will )e$ome red.
The $hanges here will )e maintained throughout until 3ou return to this s$reen and
reset the $olors. If 3ou want to ma:e $hanges in onl3 one ta)le for one ro)lemB
then it ma3 )e easier to use the tool)ar otions for foreground and )a$:ground
. 6lsoB the foreground and )a$:ground $olor sele$tion toolsB as well as the )oldB
itali$B and underline toolsB ma3 )e used on individual $olumns if 3ou sele$t these
$olumns )efore ressing on the tool.
The third ta) allows 3ou to $ustomi?e the $olors in the anels 7statusB instru$tion8.
The fourth ta) $an )e used to set the gradient that aears on several of the s$reens
7ro)lem $reationB emt3 data s$reen8B and the fifth ta) allows 3ou to reset the
$olors to their original 7fa$tor38 settings.
Other For!at Options
The font t3eB st3leB and si?e for all ta)les $an )e set. Seros $an )e set to disla3
as )lan:s rather than ?eros in the data ta)le. The grid line disla3 $an )e set
to hori?ontalB verti$alB )othB or none. The ro)lem title that aears in the data
ta)leB and whi$h was $reated at the $reation s$reenB $an )e $hanged .
In order to give some idea of the e=tensive formatting $aa)ilities availa)leB we
disla3 a samle of an overl3 formatted s$reen.
In order to $reate this s$reen we used For!at, .o%ors and $hanged the
)a$:ground and foreground $olors of odd rows to give us the alternating rows. 0e
also went to the anels ta) and $hanged the status anel )a$:ground to a dar:
$olor and the foreground to a light $olor. 6fter this we sele$ted the $olumn named
M'i3L and used the )a$:ground tools on the tool)ar to reset the $olors for this
$olumn onl3B then we sele$ted M9ru$eL and M2aurenL and used the 9old and Itali$
tools on the tool)ar rese$tivel3B andB finall3B we sele$ted M9rianL and used the
foreground tool.
Returning to the For!at menuB o)serve that the ta)le $an )e squee?ed or
e=anded . That isB the $olumn widths $an )e de$reased or in$reased. +a$h ress
of the tool $hanges the $olumn widths )3 1/ er$ent. This is ver3 useful if 7results8
ta)les are wider than the s$reen. The tool)ar has the ?oom otion whi$h ma3 also
)e used for resi?ing the $olumn widths.
NO,4C 6ll ta)les $an have their $olumn widths $hanged )3 $li$:ing on the line
searating the $olumns and dragging the $olumn divider left or rightT *ou)le
$li$:ing on this line will not automati$all3 ad@ust the $olumn width as it does in
+=$el.
The inut $an )e $he$:ed or not. It is a good idea to alwa3s $he$: the inutB )ut
not $he$:ing allows 3ou to ut entries into $ells that otherwise $ould not )e ut
there.
1Nu!-er of Deci!a%sB .o!!a and Fi9ed are used to format the disla3ed or rinted
outut. The .o!!a otion will disla3 num)ers greater than --- with a $omma. The
Nu!-er of deci!a%s dro down )o= $ontrols the ma=imum num)er of de$imals
disla3ed. If 3ou have it set to M//P then .333 would )e disla3ed as .33 while 1.! would
)e disla3ed as 1.!. If 3ou turn on the Fi9ed 7de$imal8 otion then all num)ers would
have & de$imals. Thus 1.! would )e disla3ed as 1.!/ and line u with 1.33.
,oo%s
1The software should find the 0indows $al$ulator if 3ou sele$t the .a%cu%ator
otion. If notB a $al$ulator is availa)le for simle $al$ulationsB in$luding square
root. (um)ers ma3 )e $oied from the $al$ulator and asted into an individual
$ell in the data ta)le. 6 Nor!a% Distri-ution .a%cu%ator is availa)le for
erforming $al$ulations related to the normal distri)ution. This is arti$ularl3
useful for fore$asting and ro@e$t management. See the "e%p s$reen for
information on how to use the (ormal *istri)ution 'al$ulatorB or use the ha3
fa$e on the $al$ulator to get ste4)34ste instru$tions. 6n e=amle of the (ormal
'al$ulator aears in 'hater " in the se$tion on ro@e$t management. The same
$omutations $an )e done in the Statisti$s module )ut the $al$ulator is a little more
intuitive to use.
There is an area availa)le to 0nnotate ro)lems. If 3ou want to write a note to
3ourself a)out the ro)lemB sele$t annotation. The note will )e saved with the file
if 3ou save the file. 6n e=amle of annotation aears in 'hater 1. In order to
eliminate the annotation $omletel3B the )o= must )e )lan: 7)3 deleting8 and then
the file must )e resaved. 0hen 3ou rintB 3ou have an otion to rint the note or
not.
Window
6 samle of the 0indow otions aears in the ne=t illustration. This menu otion
is ena)led onl3 at the solution s$reen. (oti$e that in this e=amle there are si=
different outut s$reens that $an )e viewed. The num)er of windows deends on
the se$ifi$ module and ro)lem.
9elow we are disla3ing the s$reen after using the ,i%e otion from the Window
menu when the s$reen resolution was set to 1&1/ )3 1/&4. 0ith this resolution it
ma3 )e ver3 useful to tile in order to see all of the availa)le solution windows. In
fa$tB using "e%p, 6ser Infor!ation 3ou $ould set all solution windows to oen u
for ever3 ro)lem. O)viousl3B the value of this otion deends on 3our s$reen
resolution.
"e%p
The "e%p otions are disla3ed ne=t. The third otion is the toi$ and will give a
des$rition of the moduleB the data required for inutB the outut resultsB and the
otions availa)le in the module. It is worthwhile to loo: at this s$reen at least one
time in order to )e $ertain that there are no unsuse$ted differen$es )etween 3our
assumtions and the assumtions of the rogram. If there is an3thing to )e warned
a)out regarding the otionB it will aear on the hel s$reen as well as in 'hater "
of this manual.
,ip of the Da5

The ,ip of the Da5 will )e disla3ed. ,rom thisB it will )e ossi)le to set the ti to
disla3 all of the time or not to disla3.
4-!ai% support
This will use 3our e4mail to set u a message to )e sent to Prenti$e Hall. The first
ste is to $li$: on the main )od3 of the message and then to aste 7'TR24. or
SHI,T4I(S8 the information that the rogram has $reated into the )od3 of the
mail.
Prora! 6pdate
This otion oints 3ou to www.renhall.$om;weiss. Adates are on the download
age.
Manua%
The rogram $omes with this manual in )oth P*, form and as a 0ord do$ument.
The P*, manual requires 6do)e a$ro)at reader whi$h is availa)le free through
httC;;www.ado)e.$om;.
,utoria%s
The rogram $omes with tutorials that are #a$romedia ,lash disla3s 7e=e files8
whi$h show 3ou how to erform $ertain oerations.
6ser Infor!ation
The user information form is shown )elow. The first ta) $an )e used to $hange the
name of the $ourseB instru$tor or s$hool. The student name is set at the time of
installation of the software and $annot )e $hanged.
The se$ond ta) is used to set several of the otions that have )een dis$ussed to this
oint.
The third ta) is used to set the te=t)oo:. There are some differen$es )etween
disla3sB models availa)le and $omutations for different te=t)oo:s.
0-out POM-QM for Windows
The last hel otion is a standard 6)out disla3. (oti$e the )uild num)er 79uild
&/8 after the version num)er. If 3ou send e4mail requesting helB lease )e sure to
in$lude this )uild num)er. 6lsoB noti$e the 0e) site lo$ation 4
www.renhall.$om;weiss. This site $ontains udatesT
'hater 4C Printing
.hapter 1
Printin
,he Print Setup Screen
6fter sele$ting Print from the menu 7or tool)ar8B the Print Setu s$reen will )e
disla3ed as shown in the figure )elow. There are several otions on this s$reen whi$h
are divided over five ta)s. The first ta) is shown )elow.
9efore e=amining the ta)s lease noti$e that the )ottom of the form $ontains three frames
whi$hB if $li$:edB will $hange the format )etween )la$:;white and $olorB ortrait and
lands$aeB and 6S'II and grid st3le rinting.
PO#45# for 0indows
'hater 4C Printing
Infor!ation to Print
The otions in the frame deend on whether Print was sele$ted from the data
s$reen or from the solution s$reen. ,rom the data s$reenB the onl3 otion that will
aear is to rint the data. HoweverB from the solution s$reen there will )e one
otion for ea$h s$reen of solution values.
,or e=amleB in the linear rogramming e=amle a)ove there are si= different
outut disla3s as well as a grah availa)le and annotation sin$e this file had a
note atta$hed. Hou $an sele$t whi$h of these will )e rinted. In generalB the data is
rinted when rinting the outut andB thereforeB it is seldom ne$essar3 to rint the
dataB meaning that all rinting $an )e erformed after the ro)lem is solved.
,a-%es vs$ 4:uations
,or the mathemati$al rogramming t3es of modulesB there is an otion availa)le
a)out the st3le of rinting. The ro)lem $an )e rinted in regular ta)ular form or
in equation form. 0e show an e=amle of ea$h ne=t.
,a-u%ar For!
Results ----------
x y RHS Dual
Maximize 3 3
labor hours 3 4 <= 14 0.5
material (ou!"s# $ 4 <= 15 0.%5
4:uation For!
Results ----------
&'()M)*+, 3x - 3y
labor hours,- 3x - 4y <= 14
material (ou!"s#,- $x - 4y <= 15
Printin 2raphs
If 3ou sele$t to rint the grahsB the software will allow 3ou to sele$t whi$h grahs
should )e rinted. ,or e=amleB Pro@e$t #anagement results in$lude three Gantt
$harts and a re$eden$e grah. Hou $an sele$t whi$h grahs 3ou would li:e from
the list that is resented as shown )elow.

'hater 4C Printing
If all 3ou want is one of the grahsB it is also ossi)le to do 3our grah rinting
from the grah s$reen 7des$ri)ed in the ne=t $hater8 rather than from the results
s$reen. ,urthermoreB if 3ou want to $ontrol the si?e of the rinted grahB use the
otions in the ne=t $hater.
Pae "eader Infor!ation
The ta) for the age header information is disla3ed )elow. There are si= ie$es of
information that $an )e $hosen to aear on the header. The first three otions will
aear on the first header lineB and the se$ond three will aear on the se$ond
header line. If the software is registered as )eing on a networ: or la) then the
student name will in$lude the name of the la) followed )3 the name of the student
that was entered when the rogram was started. To ma:e ermanent $hanges to the
$ourse name or instru$tor nameB use "e%p,
6ser Infor!ation
Pae Aa5out
PO#45# for 0indows
'hater 4C Printing
The ta) for age la3out is shown )elow.
Print as
There are two st3les of rinting that ma3 )e used. The most $ommon and fastest
wa3 to rint is as 6S'II 7lain te=t8. In additionB 3ou ma3 also rint it as a grid
similar to the one that aears on the s$reen. ThusB 3ou ma3 format the grid and
then go to the rint otion and rint a highl3 formatted grid. The formatted grids
ta:e longer to rint than the lain te=t rinting.
Paper Orientation
The aer $an )e rinted in regular fashion 7ortrait8 or it $an )e rinted sidewa3s
7lands$ae8.
0nswers
6nswers $an )e )oldB itali$B $olorB or an3 $om)ination of the three. *o not loo: for
$olor if 3ou do not have a $olor rinter. In fa$tB if 3ou set the rinting to use $olor
on a )la$:;white rinterB the $olor answers generall3 aear lighterT This is usuall3
not the desired $hara$teristi$.
Spacin
The rinting ma3 )e single4sa$ed 7highl3 suggested8 or dou)le4sa$ed.
'hater 4C Printing
Marins
The leftB rightB toB and )ottom margins $an )e set from ?ero to 1 in$h in
in$rements of .1 in$hes. The margin is a)ove or )e3ond an3 natural margin that the
rinter itself has. #argins of ?ero allow for the most rinting a$ross the age.
Ma9i!u! .o%u!n Widths
The ma=imum widths of the $olumns 7in $hara$ters8 $an )e set. The leftmost
$olumn whi$h is usuall3 namesB $an )e set searatel3 from the other $olumns. This
is useful if 3ou want to $omress ta)les.
Printer Options
The ta) for the rinter otions aears )elow.
Print to and If the Fi%e 0%read5 49ists
It is ossi)le to rint to the rinter or to rint to a file. If 3ou rint to a file 3ou will
)e as:ed for a file name. 6n3 name $an )e given. Hou also have the otion of
adding the rinting to a file that was alread3 there 7aending8 or erasing the file
)efore rinting 7rela$e file8.
Print ,i!in
Printing $an o$$ur ea$h time that 3ou use Print or it $an wait until the endB when
ever3thing will )e rinted at on$e. Printing ea$h time is generall3 refera)leB )ut
there are some situations where 3ou want to wait until the end )e$ause this ma3
save aer or minimi?e the num)er of tris to a networ: rinter.
PO#45# for 0indows
'hater 4C Printing
.hane Defau%t Printer
If 3ou have more than one rinterB 3ou ma3 $hange the rinter using this otion.
This $hanges the 0indows default rinter and ma3 affe$t other rogramsT If 3ou
rint as a gridB the rinter sele$ted is alwa3s the 0indows default rinter
regardless of what 3ou sele$t in this window.
PO#45# for 0indows
.hapter +
2raphs
Introduction
#an3 of the modules have the $aa)ilit3 to disla3 grahs or $harts
as one of the outut otions. Some of the modules have more than
one grah asso$iated with them. ,or e=amleB as shown in the figure
)elowB four different ro@e$t management grahs are availa)le. The
grah to )e disla3ed is $hosen using the ta). There are several
otions that 3ou have when a grah aearsB and we e=lain those
otions in this $hater.
'hater !C Grahs
0hen a grah is oenedB two things will o$$ur. The first is that the grah
will )e disla3ed $overing the entire area )elow the e=tra dataF the se$ond
is that some of the menu otions will $hange or e=e$ute differentl3.
Fi%e Savin
The file save otion )oth under Fi%e on the main menu and on the
tool)ar will save the 7a$tive8 grah rather than saving the file. The file ma3
still )e saved )3 using Fi%e, Save as or )3 going to a results window other
than the grah window.
Print
Print now will rint the grah rather than resenting the general rint
setu s$reen. The rint grah otions are shown )elow. The grah $an )e
rinted in two si?esB and $an )e rinted as either ortrait 71.! )3 118 or
lands$ae 711 )3 1.!8. Small grahs $an )e rinted at the to or )ottom of
the age. ThusB there is slightl3 more $ustomi?ation of grah rinting
availa)le through this method than when rinting the grahs as art of the
oututB as des$ri)ed in the revious $hater.
.o%ors F Font
The foreground $olors and the )a$:ground $olors ma3 )e $hanged )3
using the tools on the format tool)ar. 'hanging the font name on the tool)ar
will $hange the font for the headings and la)els in the grahs. 'li$:ing on
)old on the tool)ar will $hange the font in the grahs to )old.
PO#45# for 0indows
'hater "C #odules
.hapter 3
Modu%es
Overview
In this $haterB we detail ea$h of the &- modules. 0e e=lain the inut required for ea$h
moduleB the otions availa)le for modeling and solvingB and the different outut s$reens
and reorts that $an )e seen and rinted. Re$all that the menu $an )e set to disla3 onl3
PO# modulesB onl3 5# modules or all modules. ,or modules that are in )oth the PO#
and 5# menus we disla3 the POM-QM for Windows i$onB
in this manual. ,or all modules that are in the PO# onl3 menuB we disla3 the POM for
Windows i$onB
while for all modules that are in the 5# onl3 menu we disla3 the QM for Windows i$onB
.
,or e=amleB in the first moduleB aggregate lanningB whi$h aears on the ne=t ageB we
see the PO# i$on sin$e aggregate lanning aears in the POM onl& men' )ut not in the
QM onl& men'. ,inall3B the e=amles used in this manual have )een installed in the
+=amles folder in the PO#45# for 0indows folder 7Program ,ilesKPO#5#.38.
0reate BProductionC P%annin
4!
PO#45# for 0indows
Produ$tion lanning is the means )3 whi$h we reare our rodu$tion quantities
for the medium term 7generall3 one 3ear8. 6ggregate lanning refers to the fa$t
that the rodu$tion lanning is usuall3 $arried out a$ross rodu$t lines. 0e will
use the terms aggregate lanning and rodu$tion lanning inter$hangea)l3. The
main lanning diffi$ult3 is that demands var3 from month to month. 0e want to
:ee rodu$tion as sta)le as ossi)le 3et maintain minimum inventor3 and
e=erien$e a minimum of shortages. 0e must )alan$e the $osts of rodu$tionB
overtimeB su)$ontra$tingB inventor3B shortagesB and $hanges in rodu$tion levels.
In some $asesB aggregate lanning ro)lems might require the use of the
transortation or linear rogramming modules. The se$ond su)model in the
aggregate lanning module $reates and solves a transortation model of aggregate
lanning for $ases where all of the $osts are identi$al. The transortation model is
also availa)le as one of the methods for the first su)model.
,he 0reate P%annin Mode%
Produ$tion lanning ro)lems are $hara$teri?ed )3 a demand s$heduleB a set of
$aa$itiesB various $osts and a method for handling shortages. 'onsider the
following e=amle.
49a!p%e / - S!ooth Production
'onsider a situation where demands in the ne=t four eriods are for 1&//B 1!//B
1-//B and 14// units. 'urrent inventor3 is / units. Suose that regular time
$aa$it3 is &/// units er month and that overtime and su)$ontra$ting are not a
$onsideration. The $osts are U1 for ea$h unit rodu$ed during regular timeB U3 for
ea$h unit held er eriodB U4 for ea$h eriod that we are short a unitB U! for ea$h
unit )3 whi$h we in$rease rodu$tion from the revious eriodB and U" for ea$h
unit )3 whi$h we redu$e rodu$tion from the revious eriod. The s$reen for this
e=amle is disla3ed )elow.
6)ove the dataB we have two $onsiderations 4 shortage handling and the method to
use for erforming the lanning.
Shortage handling. In rodu$tion lanning there are two models for handling
shortages. In one modelB shortages are )a$:ordered. That isB demands $an
a$$umulate and )e met in later eriods. In another modelB the shortages )e$ome
lost sales. That isB if 3ou $annot satisf3 the demand in the eriod in whi$h it is
requestedB the demand disaears. This otion is a)ove the data ta)le.
4"
'hater "C #odules
Methods.
,ive methods are availa)leB whi$h we will demonstrate. Please note that smooth
rodu$tion a$$ounts for two methods.
Smooth rodu$tion will have equal rodu$tion in ever3 eriod. This $an )e
set a$$ording to the gross demand or the net demand 7gross demand minus
initial inventor38.
Produ$e to demand will $reate a rodu$tion s$hedule that is identi$al to the
demand s$hedule.
'onstant regular time rodu$tionB followed )3 overtime and su)$ontra$ting
if ne$essar3. The lesser $ost method will )e sele$ted first.
6n3 rodu$tion s$heduleC in whi$h $ase the user must enter the amounts to
)e rodu$ed in ea$h eriod.
The transortation model
Quantities
Demand. The demands are the driving for$e of aggregate lanning and these are to
)e given in one $olumn.
(a!acities - reg'lar time, o)ertime, and s'bcontracting. The rogram allows for
three t3es of rodu$tion 4 regular timeB overtimeB and su)$ontra$tingB and
$aa$ities for these are to )e given in the ne=t three $olumns. If the method
sele$ted is the user4defined methodB then these are not viewed as $aa$ities )ut
rather as rodu$tion quantities. 0hen de$iding whether to use overtime or
su)$ontra$tingB the rogram will alwa3s first sele$t the one that is less e=ensive.
4%
PO#45# for 0indows
.osts
The $osts for the ro)lem are all la$ed in the far right $olumn of the data s$reen.
Prod'ction costs - reg'lar time, o)ertime, and s'bcontracting. These are the er4
unit rodu$tion $osts deending on when and how the unit is made.
*n)entor& (holding) cost. This is the amount $harged for holding one unit for one
eriod. The total holding $ost is $harged against the ending inventor3. 9e $arefulB
)e$ause while most te=t)oo:s $harge against the ending inventor3B some te=t)oo:s
$harge against average inventor3 during the eriod.
Shortage cost. This is the amount $harged for ea$h unit that is short in a given
eriod. 0hether it is assumed that the shortages are )a$:logged and satisfied as
soon as sto$: )e$omes availa)le in a future month or are lost sales is indi$ated )3
the otion )o= a)ove the data ta)le. Shortage $osts are $harged against end4of4
month levels.
(ost to increase !rod'ction. This is the $ost due to having $hanges in the
rodu$tion s$hedule. It is given on a er4unit )asis. The $ost for in$reasing
rodu$tion entails hiring $osts. It is $harged against the $hanges in the amount of
regular time rodu$tion )ut not $harged against an3 overtime or su)$ontra$ting
rodu$tion volume $hanges. If the initial rodu$tion level is ?eroB then there will
)e no $harge for in$reasing rodu$tion in the first eriod.
(ost to decrease !rod'ction. This is similar to the $ost of in$reasing rodu$tion
and is also given on a er4unit )asis. HoweverB this is the $ost for redu$ing
rodu$tion. It is $harged onl3 against regular time rodu$tion volume $hanges.
Other .onsiderations
*nitial in)entor&. Oftentimes we have a starting inventor3 from the end of the
revious month. The starting inventor3 is la$ed in the far right $olumn towards
the )ottom.
+nits last !eriod. Sin$e some of the $osts are for $hanges in rodu$tion quantities
from eriod to eriodB it is ne$essar3 to in$lude the rodu$tion in the eriod rior
to the start of the ro)lem. These units aear in the far right $olumn at the
)ottom.
,he So%ution
41
'hater "C #odules
In the first e=amleB shown )elowB we have $hosen the smooth rodu$tion method
and )a$:orders. The demands are 1&//B 1!//B 1-//B and 14//B and the regular
time $aa$it3 of &/// e=$eeds this demand. There is no initial inventor3. The
num)ers reresent the rodu$tion amounts. The $osts $an )e seen toward the
)ottom of the $olumns. The s$reen $ontains information on )oth a eriod4)34
eriod )asis and summar3 )asis. (oti$e the $olor $oding of the data 7)la$:8B
intermediate $omutations 7magenta8 and results 7)lue8.

,eg'lar time !rod'ction. The amount to )e rodu$ed in regular time is listed in
the MRegular time rodu$tionL $olumn. This amount is determined )3 the rogram
for all otions e=$et Aser *efined. In this e=amleB )e$ause the gross 7or net8
demand is "///B there are 1!// units rodu$ed in regular time in ea$h of the 4
eriods. If the total demand is not an even multile of the num)er of eriodsB then
e=tra units will )e rodu$ed in as man3 eriods as ne$essar3 in order to meet the
demand. ,or e=amleB had the total demand )een "//&B the rodu$tion s$hedule
would have )een 1!/1 in the first and se$ond eriods and 1!// in the other two
eriods.
The ending inventor3 is reresented )3 one of two $olumns 4either MInventor3L or
MShortage.L
*n)entor& (holding). The a$$umulated inventor3 aears in this $olumn if it is
ositive. In the e=amleB there is a ositive inventor3 of 3// units in eriods 1 and
&B no inventor3 7a$tuall3 a shortage8 in eriod 3B and neither an3 inventor3 nor
shortage at the end of eriod 4.
Shortages. If there is a shortageB the amount of the shortage aears in this
$olumn. In the e=amleB the 1// in the shortage $olumn for eriod 3 means that
4-
PO#45# for 0indows
1// units of demand have not )een met. 9e$ause we have $hosen the )a$:log
otionB the demands are met as soon as ossi)leB whi$h is in the last eriod.
(o in$rease or de$rease from month to month o$$ursB so these $olumns do not
aear in this disla3.
Total. The total num)ers of units demandedB rodu$edB in inventor3B shortB or in
in$reased and de$reased rodu$tion are $omuted. In the e=amleB "/// units were
demanded and "/// units were rodu$ed and there was a total of "// unit4months
of inventor3B 1// unit4months of shortageB and / in$reased or de$reased
rodu$tion unit4months.
(osts. The totals of the $olumns are multilied )3 the aroriate $ostsB 3ielding
the total $ost for ea$h of the $ost $omonents. ,or e=amleB the "// units in
inventor3 have )een multilied )3 U3 er unitB 3ielding a total inventor3 $ost of
U11//B as disla3ed.
Total cost. The overall total $ost is $omuted and disla3ed. ,or this strateg3B the
total $ost is U!/B&//.
2raph
Two grahs are availa)le in this module.
!/
'hater "C #odules
It is ossi)le to disla3 a )ar grah of rodu$tion in ea$h eriod 7not shown8 and it
is also ossi)le to disla3 a grah of the $umulative rodu$tion versus the
$umulative demand 7shown a)ove8.
49a!p%e *: Startin inventor5 and previous production
0e have made two modifi$ations to the revious e=amle. These modifi$ations
$an )e seen in the following s$reen. In the MInitial Inventor3L lo$ationB we have
la$ed 1//. In additionB we have $hanged the method to use the net demand.
+=amining the MRegular time rodu$tionL $olumn in the outut that follows
indi$ates that the total rodu$tion is !-// rather than the "/// from the revious
e=amle due to the initial inventor3. Thus we need onl3 rodu$e 14%! er month.
!1
49a!p%e (: 6sin overti!e and su-contractin
In the ne=t e=amle shown in the following s$reenB we ta:e our original e=amle
7without starting inventor38 and redu$e the $aa$it3 to 1/// for regular time. 0e
have in$luded $aa$ities of 1// for overtime and -// for su)$ontra$tingB and we
have in$luded unit $osts for overtime and su)$ontra$ting of U- and U11B
rese$tivel3. This $an )e seen as follows.
9e$ause there is not enough regular time $aa$it3B the rogram loo:s to overtime
and su)$ontra$ting. It first $hooses the one that is less e=ensive. ThereforeB in this
e=amleB the rogram first ma:es 1/// units on regular timeB then 1// units on
overtime 7U-;unit8B then 4// units 7of the -// availa)le8 on su)$ontra$ting
U11;unit8.
49a!p%e 1: When su-contractin is %ess e9pensive than overti!e
In the following s$reenB we show a $ase where su)$ontra$ting is less e=ensive
than overtime. That isB the onl3 $hange we have made from the revious s$reen is
to ma:e the overtime $ost U13 rather than U-. This timeB the rogram first $hooses
su)$ontra$ting andB sin$e there is suffi$ient $aa$it3B overtime is not used at all.
49a!p%e +: Aost sa%es - case /
0e have ta:en the revious e=amle and we have $hanged from )a$:orders to lost
salesB as $an )e seen )elow.
The outut shows a shortage of 1// units at the end of eriod 3. In the ne=t eriodB
we rodu$e 1!// units even though we need onl3 14// units. These e=tra 1//
units are not used to satisf3 the eriod 3 shortageB sin$e these have )e$ome lost
sales. The 1// units go into inventor3B as $an )e seen from the inventor3 $olumn
in eriod 4. It does not ma:e sense to use the smooth rodu$tion model and have
lost sales. In the endB the total demand is not reall3 "///B sin$e 1// of the sales
were lost.
49a!p%e 3: ,he produce to de!and Bno inventor5C strate5
0e have ta:en our first e=amle and toggled the method to disla3 the following
rodu$e to demand or $hase strateg3.
(oti$e that the rogram has set the MRegular time rodu$tionL $olumn equal to the
demand $olumn. The inventor3 is not disla3ed )e$ause it is alwa3s / under this
otion. 0ith rodu$tion equal to demand and no starting inventor3B there will )e
neither $hanges in inventor3 nor an3 shortages. The rodu$tion rates will in$rease
and;or de$rease. In this e=amleB rodu$tion in eriod 1 was 1&// and rodu$tion
in eriod & was 1!//. ThereforeB the in$rease $olumn has a 3// in it for eriod &.
The rogram will not list an3 in$rease in eriod 1 if no initial rodu$tion is given.
The total in$reases have )een %//F de$reases !//.
*ncrease. The $hange in rodu$tion from the revious eriod to this eriod o$$urs
in this $olumn if the $hange reresents an in$rease. (oti$e that the rogram
assumes that no $hange ta:es la$e in the first eriod in this e=amle. In this
e=amleB there is no $hange in other eriods )e$ause rodu$tion is $onstant under
the smooth rodu$tion otion.
Decrease. If rodu$tion de$reasesB this de$rease aears in this $olumn.
49a!p%e G: Increase and decrease charin
The revious e=amle had in$reases and de$reases in rodu$tion. These in$reases
and de$reases are a$$ounted for )3 regular time rodu$tion. In the following
s$reenB we have redu$ed the regular time $aa$it3 in order to for$e rodu$tion
through regular time and overtime.
(oti$e that the in$rease $olumn onl3 has a value in it in the se$ond eriod when
regular time rodu$tion went from 1&// to 1!// units. The regular time
rodu$tion remains at 1!//F even though overtime in$reasesB this does not show
u in the in$rease $olumns. 0e do not $harge against su$h in$reases.
,he ,ransportation Mode% of 0reate P%annin
The transortation model of aggregate lanning $ontains data whi$h is nearl3
identi$al to the models @ust e=amined. The onl3 differen$e is that the
transortation model does not $onsider $hanges in rodu$tion levels so there is no
data entr3 allowed for in$rease and de$rease $osts or for units last eriod. The
$reation s$reen will as: for the num)er of eriods and whether shortages are
allowed or not. The similarit3 to the revious s$reens $an )e seen )elow. (oti$e
that there is onl3 one entr3 for ea$h of the $osts. ThusB this model $an not )e used
for situations where the $osts $hange from eriod to eriod. Hou must formulate
these ro)lems 3ourself using the transortation model from the #odule menu
rather than this transortation su)model of aggregate lanning.
1NO,4: The transortation model that is the se$ond su)model in the New menu
$an also )e a$$essed as the last method in the first su)modelB
The solution s$reen is disla3ed )elow. The window on the left $ontains the
rodu$tion quantities as e=ressed in transortation form. The window on the right
summari?es the rodu$tion quantitiesB unit4months of holding 7and shortage if
ali$a)le8 and the $osts.
It is even more o)vious that this is a transortation ro)lem if we e=amine the
se$ond window of outut whi$h is the transortation model itself.
The large num)ers 7----8 have )een entered in order to re$lude the rogram from
)a$:ordering. If 3ou li:eB this ta)le $ould )e $oiedF 3ou $ould then oen the
Transortation modelB $reate a newB emt3 ta)le that is 13 )3 4 and aste this data
in to that ta)le.
0sse!-%5 Aine Da%ancin
This model is used to )alan$e wor:loads on an assem)l3 line. ,ive heuristi$ rules
$an )e used for erforming the )alan$e. The $3$le time $an )e given e=li$itl3 or
the rodu$tion rate $an )e given and the rogram will $omute the $3$le time.
This model will not slit tas:s. Tas: slitting is dis$ussed in more detail in a later
se$tion.
,he Mode%
The general framewor: for assem)l3 line )alan$ing is di$tated )3 the num)er of
tas:s that are to )e )alan$ed. These tas:s are artiall3 orderedB as shownB for
e=amle in the re$eden$e diagram that follows.
Method. The five heuristi$ rules that $an )e $hosen areC
1. 2ongest oeration time
&. #ost following tas:s
3. Ran:ed ositional weight
4. Shortest oeration time
!. 2east num)er of following tas:s
NO,4: Ties are )ro:en in an ar)itrar3 fashion if two tas:s have the same riorit3
)ased on the rule given. (ote that tie4)rea:ing $an affe$t the final results.
The remaining arameters areC
(&cle time. The $3$le time $an )e given in one of two wa3s. One wa3 is when the
$3$le time is given dire$tl3 as shown a)ove. 0hile this is the easiest methodB it is
more $ommon to determine the $3$le time from the demand rate. The $3$le time is
$onverted into the same units as the times for the tas:s. 7See +=amle &8.
Tas- time 'nit. The time unit for the tas:s is given )3 this dro4down )o=. Hou
must $hoose se$ondsB hoursB or minutes. (oti$e that the $olumn heading for the
tas: times will $hange as 3ou sele$t different time units.
Tas- names. The tas: names are essential for assem)l3 line )alan$ing sin$e the3
determine the re$eden$es. 'ase does not matter.
Tas- times. The tas: times are given.
Precedences. +nter the re$eden$esB one er $ell. If there are two re$eden$es
the3 must )e entered in two $ells. *o not enter Ma, b.. In fa$tB a $omma will not )e
a$$eted. (oti$e that in the re$eden$e list in the s$reen a)ove we have t3ed )oth
a and /. 6s mentioned reviousl3B the $ase of the letters is irrelevant.
49a!p%e /
In this e=amle we have si= tas:s named a through f. The re$eden$e diagram for
this ro)lem aears a)ove. The time to erform ea$h tas: is a)ove the tas:. 6lsoB
note that the tas:s that are read3 at the )eginning of the )alan$e are tas:s a and b.
,inall3B in this first e=amleB we use a $3$le time of 1/.
So%ution
1The following s$reen $ontains the solution to our first e=amle. The solution
s$reen $onsists of two windows as shown )elow. The window on the left gives the
$omlete results for the method $hosen while the window on the right gives the
num)er of stations required 7not the theoreti$al num)er8 when using ea$h
)alan$ing rule. The solution s$reen will alwa3s have the same aearan$e and
$ontain the same information regardless of the rule that is $hosen for the )alan$e.
6lsoB as shown in the summar3 window on the rightB in this $ase ea$h rule leads to
3 stations. This is not alwa3s the $ase as will )e demonstrated later in this se$tion.
Station n'mbers. The station num)ers aear in the far left $olumn. The3 are
disla3ed onl3 for the first tas: that is loaded into ea$h station. In this e=amleB
three stations are required.
Tas- names. The tas:s that are loaded into the station are listed in the se$ond
$olumn. In this e=amleB tas:s b, e, and a are in station oneF tas:s d and c are in
station twoF and tas: f is in station 3.
Tas- times. The length of time for ea$h tas: aears in this $olumn.
Time left. The length of time that remains at the station is listed in this $olumn.
The last num)er at ea$h station isB of $ourseB the idle time at that station. The idle
times are $olored in red. ,or e=amleB there is one se$ond of idle time at station 1B
one se$ond at station &B and two se$onds at station 3B for a total of four se$onds of
idle time er $3$le.
,ead& tas-s. The tas:s that are read3 aear here. 6 read3 tas: is an3 tas: that has
had its re$eden$es met. 0e emhasi?e this )e$ause some )oo:s do not list a tas:
as read3 if its time e=$eeds the time remaining at the station. 6lsoB if the num)er
of $hara$ters in the read3 tas: list is ver3 longB 3ou might want to widen that
$olumn.
(&cle time. The $3$le time that was used aears )elow the )alan$e. This $3$le
time was either given dire$tl3 or $omuted. In this e=amleB the $3$le time was
given dire$tl3 as 1/ se$onds.
Time allocated. The total time allo$ated for ma:ing ea$h unit is disla3ed. This
time is the rodu$t of the num)er of stations and the $3$le time at ea$h station. In
this e=amle we have three stationsB ea$h with a $3$le time of 1/ se$ondsB for a
total wor: time of 3/ station4se$onds.
The time needed to ma-e one 'nit. This is siml3 the sum of the tas: times. In the
e=amle we have 1 V ! V & V % V 3 V 1 W &" se$onds.
*dle time. This is the time needed su)tra$ted from the time allo$ated. This e=amle
has 3/ 4 &" W 4B whi$h mat$hes the 4 se$onds of the three tas:s with idle times
disla3ed in red.
0fficienc&. +ffi$ien$3 is defined as the time needed divided )3 the time allo$ated.
In this e=amleB the effi$ien$3 is $omuted as &";3/B whi$h is .1""%.
1alance dela&. The )alan$e dela3 is the er$entage of wasted time or 1// er$ent
minus the effi$ien$3. In this e=amleB it is 4 7the idle time8;3/ or .1333B whi$h is
also determined )3 14.1""%.
Minim'm theoretical n'mber of stations. This is the total time to ma:e one unit
divided )3 the $3$le time and rounded '! to the nearest integer. In this e=amleB
we have &" se$onds required to ma:e one unit divided )3 a 1/4se$ond $3$le time
for an answer of &."B whi$h we round '! to 3 stations.
In additionB a se$ond window oens that disla3s the num)er of stations required
using ea$h of the different )alan$ing rules. In this arti$ular $aseB ea$h rule led to
the same num)er of stationsB 3. This is not alwa3s the $ase as shown in +=amle 4.
The re$eden$e grah $an )e disla3ed 7see the end of this se$tion8B as well as a
)ar grah indi$ating how mu$h time was used at ea$h station. These are shown at
the end of this se$tion. In additionB if there is idle time at ever3 stationB a note will
aear at the to indi$ating that the )alan$e $an )e imroved )3 redu$ing the $3$le
time. ,or e=amleB sin$e there are idle times of 1B 1 and & se$onds at the three
stationsB we $ould redu$e the $3$le time )3 1 se$ond.
49a!p%e *: .o!putin the c5c%e ti!e
Suose that for the same data we require a rodu$tion of &&!/ units in %.! hours.
0e assume full minutes and hours and $omute the $3$le time asC
7%.! hrs;&B&!/units87"/ min;hr87"/ se$;min8 W &%B///;&B&!/ W 1& se$onds.
The solution s$reen follows.
Other Ru%es
0e mention the other rules that ma3 )e used although we do not disla3 the
results.
Please note that this is one of the modules where if 3ou $hange the method 7using
the dro4down )o=8 from the solution s$reenB the ro)lem will immediatel3 )e
resolved. That isB 3ou donEt need to use the +*IT )utton and return to the data.
Most Fo%%owin ,as7s
6 $ommon wa3 to $hoose tas:s is )3 using the tas: with the most following tas:s.
(oti$e from the diagram that a has three tas:s following itB and b has two tas:s
following it. ThereforeB the first tas: s$heduled is tas: a when using this rule. The
results disla3 indi$ates the num)er of following tas:s in the $olumn named
Mread3 tas:s.L This is disla3ed in the results s$reen for +=amle 4.
Ran7ed positiona% weiht !ethod
The ran:ed ositional weight $omutes the sum of the tas: and all tas:s that
follow. ,or e=amleB for tas: a the ran:ed ositional weight is 1 V & V % V 1 W 11B
while for tas: b the weight is ! V 3 V 1 W 1". The tas: with the largest weight is
s$heduled first 7if it will fit in the remaining time8. (oti$e that e has a higher
ran:ed ositional weight than c. The results disla3 indi$ates the ran:ed ositional
weight in the $olumn named Mread3 tas:s.L
Shortest Operation ,i!e
6nother rule that is used sometimes is to give riorit3 to the tas: that ta:es the
least amount of time.
Aeast Nu!-er of Fo%%owers
The last rule that is availa)le is the least num)er of followers.
49a!p%e (: What to do if %onest operation ti!e wi%% not fit
Some )oo:s and some software do not al3 the longest oeration time rule
roerl3. If the tas: with the longest time will not fit into the stationB the tas: with
the se$ond longest time should )e la$ed in the station if it will fit.
In the following s$reen we resent data for eight tas:s. (oti$e that tas:s b, c, e,
and f immediatel3 follow tas: a.
The )alan$e aears )elow for a $3$le time of ! se$onds. 6fter tas: a is
$omletedB tas:s b, c, d, and e are read3. Tas: b is longest )ut will not fit in the 4
se$onds that remain at station 1. ThereforeB tas: c is inserted into the )alan$e. 0e
$aution 3ou that if the answer in 3our )oo: differs from the rogramB 3ou should
$he$: if the )oo: has negle$ted to ut in the tas: with the longest oeration time
that will fit.
49a!p%e 1: Sp%ittin tas7s
If the $3$le time is less than the amount of time to erform a se$ifi$ tas:B there is
a ro)lem. 0e erform what is termed tas: slitting )ut whi$h in realit3 is
a$tuall3 duli$ation. ,or e=amleB suose that the $3$le time is & minutes and a
tas: ta:es ! minutes. Then we have the tas: erformed 3 times 7)3 three eole at
three ma$hines indeendent of one another8. The effe$t is that 3 units will )e done
ever3 ! minutesB whi$h is equivalent to one unit ever3 1.33 minutesB whi$h fits
into the & minute $3$le.
(owB the a$tual wa3 that the three eole wor: ma3 var3. 0hile other rograms
will slit tas:sB the assumtions var3 from rogram to rogram. Rather than
ma:ing assumtionsB we leave it to 3ou to slit the tas:s )3 dividing the tas: time
aroriatel3.
Suose that in +=amle 1 we wanted to use a $3$le time of ! se$onds. Then it is
ne$essar3 to reli$ate )oth tas:s d and f sin$e the3 will not fit in the $3$le time.
The aroa$h to use is to solve the ro)lem )3 dividing the tas: times )3 &B sin$e
this reli$ation is needed. 0e resent the results in the following s$reen. (oti$e
that different rules lead to different minimum num)er of stationsT
2raphs
Two different grahs are availa)le. The first is a re$eden$e grahB as shown in
the figure )elow. Please note that there ma3 )e several different wa3s to draw a
re$eden$e grah.
The se$ond grah 7not disla3ed here8 is of time used at ea$h station. In a erfe$t
world these would all )e the same 7a erfe$t )alan$e8.
,he 0ssin!ent Mode%
The assignment model is used to solve the traditional one4to4one assignment
ro)lem of assigning emlo3ees to @o)sB emlo3ees to ma$hinesB ma$hines to @o)sB
et$. The model is a se$ial $ase of the transortation method. In order to generate
an assignment ro)lemB it is ne$essar3 to rovide the num)er of @o)s and ma$hines
and to indi$ate whether the ro)lem is a minimi?ation or ma=imi?ation ro)lem.
The num)er of @o)s and num)er of ma$hines do not have to )e equal )ut usuall3
the3 are.
Ob2ecti)e f'nction. The o)@e$tive $an )e to minimi?e or to ma=imi?e. This is set at
the $reation s$reen )ut $an )e $hanged in the data s$reen.
49a!p%e
The ta)le )elow shows data for a %4)34% assignment ro)lem. Our goal is to assign
ea$h saleserson to a territor3 at minimum total $ost. There must )e e=a$tl3 one
saleserson er territor3 and e=a$tl3 one territor3 er saleserson.
#ort 'i3 9ru$e 9eth 2auren +ddie 9rian
Penns3lvania
(ew >erse3
(ew Hor:
,lorida
'anada
#e=i$o
+uroe
1&
33
1&
1!
4&
4/
1&
!4
4!
!4
3%
3&
%1
34
Q
1%
%"
3%
11
%1
"!
1%
&%
&3
"!
%%
%"
&3
!4
34
1%
&"
&3
1&
44
1-
%"
44
-"
!!
-/
&3
-1
"!
"&
&3
1%
44
1&
Q 9ru$e is not allowed to wor: in the state of Penns3lvania.
The data stru$ture is nearl3 identi$al to the stru$ture for the transortation model.
The )asi$ differen$e is that the assignment model does not disla3 sulies and
demands sin$e the3 are all equal to one.
NO,4: To tr3 to re$lude an assignment from )eing madeB su$h as 9ru$e to
Penns3lvania in this e=amleB enter a ver3 large $ost. If 3ou t3e H9I, the rogram
will la$e a $ost of -B--- for minimi?ation ro)lems or a rofit of 4-B--- for
ma=imi?ation ro)lems in that $ell.
,he So%ution
/ssignments. The M6ssignsL in the main )od3 of the ta)le are the assignments that
are to )e made. In the e=amleB #ort is to )e assigned to Penns3lvaniaB 'i3 to
,loridaB 9ru$e to 'anadaB 9eth to (ew Hor:B 2auren to (ew >erse3B +ddie to
+uroeB and 9rian to #e=i$o.
Total cost. The total $ost aears in the uer left $ellB U1-1 in this e=amle.
The assignments $an also )e given in list formB as shown in the s$reen )elow.
The marginal $osts $an )e disla3ed also. ,or e=amleB if we want to assign #ort
to (ew >erse3B the total will in$rease )3 U3/ to U&&1.
Drea7even&.ost-?o%u!e 0na%5sis
'ost4volume anal3sis is used in several different areas of PO# and 5#B
ese$iall3 $aa$it3 lanning and lo$ation anal3sis. 'ost4volume anal3sis is used to
find the oint of indifferen$e )etween two otions )ased on fi=ed and varia)le
$osts. 6 )rea:even oint is $omuted in terms of units or dollars. 9rea:even is
siml3 a se$ial $ase of $ost4volume anal3sis where there is one fi=ed $ostB one
varia)le $ostB and revenue4 er4unit.
.ost-?o%u!e 0na%5sis
In $ost4volume anal3sis we $omare two or more otions to determine what otion
is least $ostl3 at an3 volume. The $osts $onsist of two t3es 4 fi=ed $osts and
varia)le $ostsB )ut there ma3 )e several individual $osts that $omrise the fi=ed
$osts or the varia)le $osts. In the e=amle that followsB we are indi$ating that there
are five different individual $osts and two otions.
Data
(ost t&!e. +a$h t3e of $ost must )e identified as either a fi=ed $ost or a varia)le
$ost. The default is that the first $ost in the list is fi=ed and that all other $osts are
varia)le. These values $an )e $hanged )3 using the dro4down )o= in that $ell.
(osts. The se$ifi$ $ost for ea$h otion gets listed in the two $olumns in the ta)le.
3ol'me. If a volume anal3sis is desiredB enter the volume at whi$h this anal3sis
should )e erformed. The volume anal3sis will $omute the total $ost 7revenue8 at
the $hosen volume. If the volume is /B no volume anal3sis will )e erformed other
than for the )rea:even oint. 0e have as:ed for a volume anal3sis at &!/ units.
So%ution
The solution s$reen is ver3 straightforward. In the re$eding s$reen there are five
$osts with some fi=ed and some varia)le. The rogram disla3s the following
resultsC
Total fi4ed costs. ,or ea$h of the two otionsB the rogram ta:es the fi=ed $ostsB
sums themB and lists them )elow the ta)le. In this e=amleB the total fi=ed $osts for
Otion 1 are U13// 71//V!//8B while the total fi=ed $osts for Otion & are U-//
7%//V&//8.
Total )ariable costs. The rogram identifies the varia)le $ostsB sums them uB and
lists them. In this e=amleB the total varia)le $osts for Otion 1 are U1/ er unitB
while for Otion & the3 are U1& er unit.
1rea-e)en !oint in 'nits. The )rea:even oint is the differen$e )etween the fi=ed
$osts divided )3 the differen$e )etween the varia)le $ostsB and this is disla3ed in
units. In the e=amleB it is &// units.
1rea-e)en !oint in dollars. The )rea:even oint $an also )e e=ressed in dollars.
6 volume anal3sis has )een erformed for a volume of &!/ units. The total fi=ed
$osts and total varia)le $osts have )een $omuted for ea$h otion and these have
)een summed to 3ield the total $ost for ea$h otion.
6 grah is availa)leB as follows.
49a!p%e *: Drea7even ana%5sis
One standard t3e of )rea:even anal3sis has revenue versus $osts.
*ata entr3 for this otion is slightl3 different in that the rogram $reates a $olumn
for $osts and a $olumn for revenues. The fi=ed and varia)le $osts get entered in the
$ost $olumn and the revenue4er4unit is la$ed in the revenue $olumn.
This model requires e=a$tl3 3 inuts. The first is for the fi=ed $ost of U1/B///B the
se$ond for the varia)le $ost of U&/ er unitB and the third for the 7varia)le8 revenue
of U&! er unit. The rogram will $omute a )rea:even volume of &/// units or
U!/B/// 7not shown8.
This e=amle $ould also have )een solved )3 using the $ost4volume su)model.
Sele$t two otions and let one )e the $osts and one )e the revenues. Pla$e the
fi=ed $osts and varia)le $osts in their o)vious $ellsB use no fi=ed $ost for the
revenue and use the revenue er unit as a varia)le $ost. 0e disla3 this )elow.
49a!p%e (: Drea7even point with !ore than two options
The )rea:even module $an erform a )rea:even anal3sis for u to five otions. In
the following we demonstrate the outut for a three4otion )rea:even. The
solution s$reen )elow is indi$ating three )rea:even oints as it ma:es $omarisons
for 'omuter 1 vs. 'omuter &B 'omuter 1 vs. 'omuter 3B and 'omuter & vs.
'omuter 3. Of $ourseB while there are three )rea:even ointsB onl3 two of them
are relevant.
This is seen a little more easil3 )3 loo:ing at the )rea:even grah given )elow.
The )rea:even oint at 4/B/// units does not matter sin$e at 4/B/// units the two
$omuters that )rea:even have higher $osts than the 'omuter & otion.
.apita% Invest!ent
This module $an )e used for finding the net resent value of a $ash flow or for
finding the internal rate of return of a $ash flow. The data for this e=amle $onsist
of a stream of inflows and a stream of outflows. In additionB for finding the net
resent value an interest rate must )e given.
Net Present ?a%ue
'onsider the following e=amle. 6 $oman3 is going to ur$hase new equiment
that $osts U1//B///. 9e$ause of the use of the new equiment the $oman3 will
e=erien$e savings over the ne=t " 3ears of U&&B///F U&!B///F U&&B///F U&1B///F
U1-B///F and U11B///. 6t the end of si= 3ears the $oman3 anti$iates )eing a)le
to salvage the ma$hine for U&!B///. The $oman3 would li:e to :now the net
resent value using an interest rate of 1/ er$ent. The data s$reen aears )elowC
The s$reen has two $olumns for data. One $olumn is la)eled inflow and the other
$olumn is la)eled outflow. 0e had indi$ated at the time of ro)lem $reation that
this was a si=4eriod ro)lem and the data ta)le in$ludes the si= eriods lus the
$urrent eriod 7/8. The ur$hase $ost of U1//B/// is an outflow that o$$urs at the
)eginning of the ro)lemB so this is la$ed in the outflow for eriod /. The si=
savings in the list a)ove are inflowsB and the3 are la$ed in the inflow $olumn for
Periods 1 through ". The salvage value $ould )e handled two wa3sB and we have
$hosen the wa3 that we thin: gives a )etter disla3. 0e $ould have added the
salvage value of U&!B/// to the inflow in Period ". InsteadB we $hose to reresent
it as a negative outflow. This :ees the meaning of the num)ers $learer. The last
item to )e entered is the interest rate in the te=t )o= a)ove the data. The results
aear )elowC
6 $olumn has )een $reated that gives the resent value fa$tors for single
a3ments. To the right of thisB the inflows and outflows are multilied )3 these
resent value fa$torsB and the far right $olumn $ontains the resent values for the
net inflow 7inflow4outflow8 on a eriod4)34eriod )asis. The )ottom row gives the
totals for ea$h $olumn and the solution to our ro)lem is a net resent value of
U%"/3.&!.
Interna% Rate of Return
The $omutation of the internal rate of return is ver3 simle. The data is set u the
same wa3 )ut the method )o= is $hanged from net resent value to internal rate of
return. The results aear )elow where 3ou $an see that the internal rate of return
for the same data is 1&.31 er$ent andB of $ourseB the net resent value 7)ottom
right8 when using this rate is U/.
Decision 0na%5sis
There are two ver3 )asi$ models used for de$ision anal3sis 4 de$ision ta)les and
de$ision trees. This module $ontains a model for a general de$ision ta)leF a model
for entering a de$ision tree in ta)ular formF an e=$itingB new model with a
grahi$al user interfa$e for de$ision treesF and a model for $reating a de$ision
ta)le for demand;sul3 or one eriod inventor3 situations.
,he Decision ,a-%e Mode%
The de$ision ta)le $an )e used to find the e=e$ted valueB the ma=imin 7minima=8
and;or the ma=ima= 7minimin8 when several de$ision otions are availa)le and
there are several s$enarios that might o$$ur. 6lsoB the e=e$ted value under
$ertaint3B the e=e$ted value of erfe$t informationB and the regret 7oortunit3
$ost $an )e $omuted.
The general framewor: for de$ision ta)les is given )3 the num)er of otions 7or
alternatives8 that are availa)le to the de$ision ma:er and the num)er of s$enarios
7or states of nature8 that might o$$ur. In additionB we must $hoose whether the
o)@e$tive is to ma=imi?e rofits or to minimi?e $osts.
Scenario !robabilities. ,or ea$h s$enario it is ossi)le 7)ut not required8 to enter a
ro)a)ilit3. The e=e$ted value measures 7e=e$ted monetar3 valueB e=e$ted
value under $ertaint3B and e=e$ted value of erfe$t information8 require
ro)a)ilitiesB while the ma=imin 7minima=8 and ma=ima= 7minimin8 do not.
NO,4: If the ro)a)ilities are identi$al then siml3 enter an MWL in one of the
ro)a)ilit3 $ells and the rogram will set them all equal.
Profits or costs. The rofit 7$ost8 for ea$h $om)ination of otions and s$enarios is
to )e given.
$'rwic5 al!ha. 6)ove the data is a s$roll)ar;te=t)o= $om)ination for entering the
value for the Hurwi$? alha. The Hurwi$? value is used to give a weighted average
of the )est and worst out$omes for ea$h strateg3 7row8. This is not in ever3
te=t)oo:.
49a!p%e /: 0 Decision ,a-%e
The following e=amle resents three de$ision otions whi$h are to su)$ontra$tB to
use overtimeB or to use art4time hel. The ossi)le s$enarios 7states of nature8 are
that demand will )e lowB normalB or highF or that there will )e a stri:e or a wor:
slowdown. The ta)le $ontains rofits as indi$ated. The first row in the ta)le
reresents the ro)a)ilit3 that ea$h of these states will o$$ur. The remaining three
rows reresent the rofit that we a$$rue if we ma:e that de$ision and the state of
nature o$$urs. ,or e=amleB if we sele$t to use overtime and there is high demandB
our rofit will )e 11/.
So%ution
The results s$reen that follows $ontains )oth the data and the results for this
e=amle.
04!ected )al'es. The e=e$ted values for the otions have )een $omuted and
aear in a $olumn la)eled M+#.L 7e=e$ted monetar3 value8B whi$h has )een
aended to the right4hand side of the data ta)le.
,ow minim'm. ,or ea$h rowB the minimum element has )een found and listed.
This element is used to find the ma=imin or minimin.
,ow ma4im'm. ,or ea$h rowB the ma=imum element in the row has )een found
and listed. This num)er is used for determining the ma=ima= or minima=.
$'rwic5. These reresent 4/ er$ent multilied )3 the )est out$ome lus "/
er$ent multilied )3 the worst out$ome for ea$h row. ,or e=amleB for
su)$ontra$ting the Hurwi$? isC
.4 Q 14/ V ." Q 1// W 11".
Ma4im'm e4!ected )al'e. 9e$ause this is a rofit ro)lem we are interested in
finding the ma=imum values. The ma=imum e=e$ted value is the largest num)er
in the e=e$ted value $olumnB whi$h in this e=amle is 1&4.!.
Ma4imin. The ma=imin is the largest 7#6IImum8 num)er in the #I(imum
$olumn. In this e=amleB the ma=imin is 1//.
Ma4ima4. The ma=ima= is the largest value in the ta)le or the largest value in the
ma=imum $olumn. In this e=amleB it is 1-/.
Perfect Infor!ation
6 se$ond s$reen of results resents the $omutations for the e=e$ted value of
erfe$t information as shown )elow.
Perfect information. 6n e=tra row la)eled MPerfe$t InformationL has )een added
)elow the original data. In this rowB we have listed the )est out$ome for ea$h
$olumn. ,or e=amleB for the low demand s$enario the )est out$ome is the 1&/
given )3 using overtime.
Perfect6!robabilit& (04!ected )al'e 'nder certaint&). The e=e$ted value under
$ertaint3 is $omuted as the sum of the rodu$ts of the ro)a)ilities multilied )3
the )est out$omes. In the e=amleB this isC
+.7'ertaint38W .&Q1&/ V .3Q1!/ V .&!Q1-/ V .1!Q1&/ V .1Q13/ W 14%.!/
The row disla3s the individual multili$ations in the equation a)ove 7&4B 4!B
4%.!B 11B and 138 and the sum 714%.!8 disla3ed on the right hand side of )oth the
equation and the row.
04!ected )al'e of !erfect information. The e=e$ted value of erfe$t information
7+.PI8 is the differen$e )etween the )est e=e$ted value 71&4.!8 and the e=e$ted
value under $ertaint3 714%.!8B whi$h in this e=amle is &3.
Reret&Opportunit5 Aoss
6 third availa)le outut disla3 is that of regret or oortunit3 loss as disla3ed
)elow.
Table )al'es. The values in the ta)le are for ea$h $olumn $omuted as the $ell
value su)tra$ted from the )est value in the $olumn in the data. ,or e=amleB under
low demand the )est out$ome is 1&/. If we su)$ontra$t and get 1// then our regret
is &/ while if we use art time hel our regret is 1&/41/! W1!. The two $olumns
on the right 3ield two sets of results. In the $olumn la)eled ma=imum regretB we
determine the worst 7highest8 regret for ea$h de$ision and then find the minima=
regret 7!/8 )3 loo:ing at the )est 7lowest8 of these regrets. In the $olumn la)eled
+=e$ted RegretB we siml3 multil3 the regrets in ea$h row )3 the ro)a)ilities.
There also is a window 7not disla3ed in this manual8 that 3ields Hurwi$? values
for alha ranging from / to 1 )3 ./1 for ea$h de$ision otion.
Decision ,rees
*e$ision trees are used when sequen$es of de$isions are to )e made. The trees
$onsist of )ran$hes that $onne$t either de$ision ointsB oints reresenting $han$eB
or final out$omes. The ro)a)ilities and rofits or $osts are entered and the
de$isions that should )e made and the values of ea$h node are $omuted. 6ll
de$ision ta)les $an )e ut in the form of a de$ision tree. The $onverse is not true.
Note: .ersion 3 of the software in$ludes two different inut st3les for de$ision
trees$ The first model has ta)ular data entr3 while the se$ond model is easier to
use )e$ause it has grahi$al data entr3. The first model has )een maintained in the
software for $onsisten$3 with revious versions.
49a!p%e * - 0 Decision ,ree - non raphica%
The general framewor: for de$ision trees is given )3 the num)er of )ran$hes or
the num)er of nodes in the tree. The num)er of )ran$hes is alwa3s one less than
the num)er of nodes. +a$h node alwa3s has e=a$tl3 one )ran$h going into it. The
num)er of )ran$hes going out of an3 node $an )e /B 1 or &F the nodes are of three
t3es. There are de$ision nodesB $han$e nodesB and final nodes. T3i$all3B the
de$ision nodes are reresented )3 re$tanglesB and the $han$e nodes are reresented
)3 $ir$les. Our e=amle is given )3 a t3i$al de$ision tree diagram. The figure has
1& )ran$hes. Profits are to the right of the terminal nodes. (oti$e that there is a
U1// $ost in the middle for sele$ting a $ertain 7mar:et resear$h8 )ran$h.
In order to use the de$ision tree moduleB two things must o$$ur. ,irstB nodes must
)e added to the right of the ending )ran$hes. 7Te$hni$all3B it is illegal to draw a
tree that ends with )ran$hes rather than nodes.8 Se$ondB the nodes must )e
num)ered. The figure that follows shows the added nodes and the fa$t that all
nodes have )een given num)ers. The most $onvenient wa3 to num)er the nodes is
from left to right and to to )ottom.
The initial data s$reen is generated )3 answering that there are 1& )ran$hes and
those we wish to ma=imi?e rofits. The following s$reen $ontains )oth the data
and the solution.
Start and end node. 9ran$hes are $hara$teri?ed )3 their start and end nodes. 6n
added )ran$h named MStartL aears in order to reresent the final out$ome. The
node values are shown in the far right $olumn. In this e=amleB the value of the
de$ision tree is U4"!.
1ranching !robabilities. These o$$ur in $olumn 4 and are the ro)a)ilit3 of going
from the start node on the )ran$h to the end node. The ro)a)ilities out of an
individual $han$e )ran$h should sum to 1.
Profits or costs. The rofit 7$ost8 for ea$h ending node that is terminal is to )e
entered. In additionB it is ossi)le to enter a rofit or $ost for an3 )ran$h. ,or
e=amleB noti$e that in )ran$h 1/ 7node " to 118 we have entered a $ost of U1// )3
la$ing 41// in that $ell.
,he Decision ,ree So%ution
The solution data areC
1ranch 'se. ,or those )ran$hes that are de$ision )ran$hes and should alwa3s )e
$hosenB an M6lwa3sL is disla3ed. In our e=amleB we should $hoose 71438 rather
than 714&8. ,or those )ran$hes that we should $hoose if we get thereB we disla3
MPossi)l3.L ,or e=amleB if we get to node " we should sele$t 7"4-8 rather than 7"4
18. HoweverB there is no guarantee that we will get to node " due to the
ro)a)ilisti$ nature of the de$ision tree. The last t3e of )ran$h is one that we
should sele$t if we get thereB )ut we should not get there. These are mar:ed as
M9a$:wards.L 2oo: at )ran$h % 7node 4 to node 18. If we get to node 1B we should
use this )ran$h. HoweverB sin$e we will sele$t 1 to 3 at the )eginningB we should
not end u at node 4.
0nding node. The ending node is reeated to ma:e the outut easier to read.
0nding node t&!e. ,or ea$h ending nodeB the rogram identifies it as either a final
nodeB a de$ision nodeB or a $han$e node.
04!ected )al'e. The e=e$ted value for ea$h node is listed. ,or final nodesB the
e=e$ted value is identi$al to the inut. ,or $han$e nodesB the e=e$ted value is
the weighted $om)ination of the values of the nodes that follow. ,or de$ision
nodesB the e=e$ted value is the )est value availa)le from that )ran$h. 9oth $han$e
nodes and de$ision nodes will have an3 $osts su)tra$ted from the node values. ,or
e=amleB the value of node 11 is U!!/. HoweverB the value of node " is U4!/ due
to the U1// $ost of going from node " to node -.
6 grah of the tree stru$ture $an )e disla3ed )3 the rogram.
49a!p%e ( - 0 Decision ,ree - 2raphica% 6ser Interface
One of the models allows for de$ision trees to )e entered grahi$all3 rather than in
the ta)le as given a)ove. 0e will use this model to e=amine the same e=amle @ust
$omleted.
6fter sele$ting the modelB the interfa$e will aear as disla3ed )elow. This is the
onl3 model in the software that has an inut interfa$e that is not the usual data
ta)le interfa$e.
The grah is disla3ed in the large area on the left and $reated using the tools on
the right. In the )eginning there is onl3 one node. The ne=t ste is to add two event
nodes to node 1. The tool on the right is set to node 1. The default for node 1 is
that it is a de$ision node as we need in this $ase. 6 )utton is availa)le to $hange
the node if this )e$omes ne$essar3. Sin$e the default num)er of )ran$hes to add is
&B the first ste is to $li$: on the M6dd n )ran$hesL )utton. Our new tree aears as
follows.
(oti$e that two )ran$hes have )een added. The $urrent node is node & whi$h is
indi$ated )3 )oth the fa$t that the node num)er in the uer right is node & )ut
also )3 the fa$t that the )ran$h to node & is highlighted in a different $olor. (oti$e
that the )ran$hes have )een given default names of M*e$ision 1P and M*e$ision &P.
These $an )e $hanged )3 using the )ran$h information area at the )ottom of the
inut tool area.
6t this oint we need to add two )ran$hes to node &. The default is to add de$ision
)ran$hes to events and vi$e4versa. The t3e of node $an alwa3s )e $hanged later.
'li$: on M6dd n )ran$hesLB then enter the ro)a)ilities for )oth new nodes and
enter the rofit of U4// for the se$ond node. Then add two )ran$hes to node 3 and
fill in the ro)a)ilities and the U!// rofit. This 3ields the following.
NO,4: (odes ma3 )e sele$ted )3 either $li$:ing on them or using the
s$roll)ar;te=t)o= $om)ination at the to of the tools se$tion on the right.
'omlete the data inut )3 adding de$ision )ran$hes and data at nodes 4 and "
and an event at node 11. 6lsoB in$lude the U1// $ost at de$ision " 7nodes "4118.
6fter all data has )een enteredB $li$: on the Solve )utton on the tool)ar. The data
is in )la$: and the solution is in )lue as usual. (oti$e that )ran$hes that should )e
used are indi$ated in )lue.
49a!p%e 1 - Sin%e period inventor5
This model $an )e used to $reate a de$ision ta)le for single eriod inventor3
7sul3;demand8 situations. 'onsider the following e=amle. In the astB an airline
has o)served a demand for meals that are sold on the lane as given in the ta)le
)elow. +a$h meal $osts the airline U4 and sells for U1/. If the airline is short a
mealB the3 give the assengers a vou$her worth U! for food at the airort of arrival.
How man3 meals should the airlane sto$: er flightX
#eals Pro)a)ilit3
1/
1!
&/
&!
3/
.1
.&
.!
.1!
./!
9eginB )3 $reating a ta)le with ! demands.
The rogram is requesting three rofits as well as the o)vious demands and
ro)a)ilities.
Profit !er 'nit. This is the normal rofit for units )ought and sold. In this $ase the
rofit isB U1/4U4WU".
Profit !er 'nit e4cess is the rofit for units that are overordered. In some $asesB
where there is a salvage value that e=$eeds the $ost of the unit this will )e a rofit
while in other $ases this will )e a loss. In this $ase there is a loss whi$h is equal to
the $ost of an unsold meal or 4U4.
Profit !er 'nit short. This is the rofit for units when we donEt order enough. It
will )e a rofit if we $an ur$hase units to sell after the fa$t at a $ost less than the
selling ri$e. Otherwise it will )e a / or ossi)l3 a loss. In this $aseB )e$ause we
give a vou$her we have a loss equal to the $ost of the vou$herB 4U!. If we did not
give the vou$her there would )e no rofit or loss for units for whi$h we $ould not
satisf3 the demand.
Demands and !robabilities. +nter the list of demands and their asso$iated
ro)a)ilities.
The solution is )elow. The airline should order &/ meals to ma=imi?e its e=e$ted
rofit. The value of the e=e$ted rofit is U-3.%!.
Forecastin
,ore$asting models are divided into four su)models. The first t3e of model is when we
use ast data 7sales8 to redi$t the future 7demand8. This is termed time series anal3sisB
whi$h in$ludes the naive methodB moving averagesB weighted moving averagesB
e=onential smoothingB e=onential smoothing with trendB trend anal3sisB linear
regressionB multili$ative de$omositionB and additive de$omosition.
The se$ond model is for situations where one varia)le 7demand8 is a fun$tion of one or
more other varia)les. This is termed 7multile8 regression. There is overla )etween the
two models in that simle 7one indeendent varia)le8 linear regression $an )e erformed
with either of the two su)models.
In additionB this a$:age $ontains a third model whi$h ena)les us to $reate fore$asts given
a arti$ular regression model and a fourth model whi$h ena)les us to $omute errors
given demands and fore$asts.
,i!e Series
The inut to time series anal3sis is a series of num)ers reresenting data over the most
re$ent n time eriods. 0hile the ma@or result is alwa3s the fore$ast for the ne=t eriodB
additional results resented var3 a$$ording to the te$hnique that is $hosen. ,or ever3
te$hniqueB the outut in$ludes the sequen$e of Mfore$astsL that are made on ast data and
the fore$ast for the ne=t eriod. 0hen using trend anal3sis or seasonal de$omositionB
fore$asts $an )e made for more than one eriod into the future.
The summar3 measures in$lude the traditional error measures of )ias 7average error8B
mean squared errorB standard errorB mean a)solute deviation 7#6*8 and mean a)solute
er$ent error 7#6P+8.
NO,4C *ifferent authors $omute the standard error in slightl3 different wa3s. That isB
the denominator in the square root is given )3 Y& )3 some authors and Y1 )3 others.
POM-QM for Windows uses Y& in the denominator for simle $ases and alwa3s disla3s
the denominator in the outut.
,he ,i!e Series Data Screen
Suose that we have data as given in the following ta)le and wish to fore$ast the
demand for the wee: of ,e)ruar3 14 7and ma3)e ,e)ruar3 &1B ,e)ruar3 &1 ...8.
0ee: Sales
>anuar3 3
>anuar3 1/
>anuar3 1%
>anuar3 &4
>anuar3 31
,e)ruar3 %
1//
1&/
11/
1/!
11/
1&/
The general framewor: for time series fore$asting is given )3 indi$ating the
num)er of !ast data oints. The re$eding e=amle has ast data for the last si=
eriods 7wee:s8B and we wish to fore$ast for the ne=t eriod 4 eriod % 7,e)ruar3
148.
7orecasting method. The dro4down method )o= $ontains the eight methods that
were named at the to of this module lus a method for users to enter their own
fore$asts in order to erform an error anal3sis. Of $ourseB the results deend on the
fore$asting method $hosen. 6 moving average is shown a)ove.
8'mber of !eriods in the mo)ing a)erage, n. To use the moving average or
weighted moving averageB the num)er of eriods in the average must )e given.
This is some integer )etween 1 and the num)er of time eriods of data. In the
re$eding e=amleB & eriods were $hosenB as seen in the e=tra data area.
3al'es for de!endent (&) )ariable. These are the most imortant num)ers )e$ause
the3 reresent the data. In most $asesB these will siml3 )e the ast sales or
demands. The data is in the demand $olumn given )3 1//B 1&/B 11/B 1/!B 11/B and
1&/.
So%ution
The solution s$reens are all similarB )ut the e=a$t outut deends on the method
$hosen. ,or the smoothing te$hniques of moving averages 7weighted or
unweighted8 and single e=onential smoothingB there is one set of oututB while for
e=onential smoothing with trendB there is a slightl3 different outut disla3. ,or
the regression modelsB there is another set of outut. The first availa)le method is
the (aive method whi$h siml3 uses the data for the most re$ent eriod as the
fore$ast for the ne=t eriod. This is a se$ial $ase of a moving average with nW1 or
e=onential smoothing with W 1 so we do not disla3 the naive method here.
0e )egin with the moving averages.
49a!p%e /: Movin averaes
0e are using a two4wee: 7n W &8 moving average. The main outut is a summar3
ta)le of results.
The $omutations for all of these results $an )e seen on the details window
disla3ed )elow.
7orecasts. The first $olumn of outut data is the set of fore$asts that would )e
made when using the te$hnique. (oti$e that sin$e this is a two4wee: moving
averageB the first fore$ast $annot )e made until the third wee:. This value is the
11/B whi$h aears as the first entr3 in the M,ore$astL $olumn. The 11/ is
$omuted as 71//V1&/8;&. The following three num)ers 4 11!B 1/%.!B and 1/%.! 4
reresent the Mfore$astsL of the old dataF the last num)er in the $olumnB 11!B is
mar:ed as the fore$ast for the ne=t eriod 4 eriod num)er %.
8e4t !eriod forecast. 6s mentioned in the revious aragrahB the last fore$ast is
)elow the data and is the fore$ast for the ne=t eriodF it is mar:ed as su$h on the
s$reen. In the e=amleB it is 11!.
0rror. This $olumn )egins the error anal3sis. The differen$e )etween the fore$ast
and the demand aears in this $olumn. The first row to have an entr3 is the row
in whi$h the first fore$ast ta:es la$e. In this e=amleB the first fore$ast o$$urs on
>an. 1% 7row 38 and the fore$ast was for 11/B whi$h means that the error was /. In
the ne=t wee: the fore$ast was for 11!B )ut the demand was onl3 1/!B so the error
was 41/ 7minus 1/8.
/bsol'te )al'e of the error. This $olumn $ontains the a)solute value of the error
and is used to $omute the #6*B or total a)solute deviation. (oti$e that the 41/ in
the error $olumn has )e$ome a 7lainB unsignedB ositive8 1/ in this $olumn.
0rror s9'ared. This $olumn $ontains the square of ea$h error in order to $omute
the mean squared error and standard error. The 1/ has )een squared and is listed
as 1//. 0e $aution that )e$ause we are squaring num)ers it is quite ossi)le that
the num)ers will )e$ome large here and that the disla3 will )e$ome a little
mess3. This is ese$iall3 true when rinting.
/bsol'te Percentage 0rror. This $olumn $ontains the a)solute value of the error
divided )3 the demand. If the demand is / then the software will issue a warning
regarding the #6P+.
Totals. The total for the demand and ea$h of the four error $olumns aears in this
row. This row will $ontain the answers to ro)lems in )oo:s that rel3 on the total
a)solute deviation rather than the mean a)solute deviation. 9oo:s using total
instead of mean should $aution students a)out unfair $omarisons when there are
different num)ers of eriods in the error $omutation.
/)erages. The averages for ea$h of the four errors aear in this row. The average
error is termed the )ias and man3 )oo:s negle$t this ver3 useful error measure.
The average a)solute error is termed the #6* and aears in nearl3 ever3 )oo:
due to its $omutational ease. The average squared error is termed the mean
squared error 7#S+8 and is t3i$all3 asso$iated with regression;least squares. The
average of the a)solute er$entage errors is termed the mean a)solute er$entage
error 7#6P+8. These four names are indi$ated on the s$reen as 9iasB #6*B #S+
and #6P+ underneath their values. In this e=amleB the )ias is 1.&!B the #6* is
".&!B the #S+ is "!."&! and the #6P+ is !.!!Z.
Standard error. One more error measure is imortant. This is the standard error.
*ifferent )oo:s have different formulas for the standard error. That isB some use n
Y1 in the denominatorB and some use nY&. This rogram uses nY&. The
denominator is disla3ed in the summar3 outut as shown a)ove. In this e=amleB
the standard error is 11.4!"4.
NO,4: The (ormal distri)ution $al$ulator $an )e used to find $onfiden$e
intervals and address other ro)a)ilisti$ questions related to fore$asting.
One more s$reen is availa)le for all of these methods. It is a s$reen that gives the
fore$ast $ontrol 7tra$:ing signals8 results.
,or moving averages there is a summar3 s$reen of error measures versus the JnE in
the moving average.
1One of the outut disla3s 7not shown in this manual8 resents error measures as
a fun$tion of n. 6lsoB the moving average grah has a s$roll )ar whi$h ena)les 3ou
to easil3 see how the fore$asts $hange as varies.
49a!p%e *: Weihted !ovin averaes
If the weighted moving average method is $hosenB two new $olumns will aear
on the data ta)le as shown in the following s$reen. The far right $olumn is where
the weights are to )e la$ed. The weights ma3 )e fra$tions that sum to one as in
this e=amle 7." and .48B )ut the3 do not have to sum to 1. If the3 do notB the3 will
)e res$aled. ,or e=amleB weights of & and 1 will )e $onverted to &;3 and 1;3. In
this e=amleB weights of ." and .4 have )een used to erform the fore$asting. ,or
e=amleB the fore$ast for wee: % is ."Q1&/ V .4Q11/ W 11".
6 7se$ondar38 solution s$reen aears )elow. 6s )eforeB the errors and the error
measures are $omuted.
49a!p%e (: 49ponentia% s!oothin
/l!ha for e4!onential smoothing. In order to use e=onential smoothingB a value
for the smoothing $onstantB alhaB must )e entered. This num)er is )etween / and
1. 6t the to of the s$reen a s$roll)ar;te=t )o= $om)ination will aearB ena)ling
3ou to enter the value for the smoothing $onstantB alha as shown in the following
s$reen. The smoothing $onstant alha is .! in this e=amle.
NO,4: If 3ou sele$t alha W /B the software will find the )est 7lowest #6*8
value for alhaT
/ starting forecast for e4!onential smoothing. In order to erform e=onential
smoothingB a starting fore$ast is ne$essar3. 0hen e=onential smoothing is
sele$tedB the $olumn la)el Mfore$astL will aear on the s$reen. Anderneath will )e
a )lan: $olumn. If 3ou wantB 3ou ma3 enter one num)er in this $olumn as the
fore$ast. If 3ou enter no num)erB the starting fore$ast is ta:en as the starting
demand.
The results s$reen has the same $olumns and aearan$e as the revious two
methodsB as shown ne=t.
One of the outut disla3s 7not shown in this manual8 resents error measures as a
fun$tion of alha. 6lsoB the grah for e=onential has a s$roll )ar whi$h ena)les
3ou to easil3 see how the fore$asts $hange as varies.
49a!p%e 1: 49ponentia% s!oothin with trend
+=onential smoothing with trend requires two smoothing $onstants. 6 smoothing
$onstantB )etaB for the trend is added to the model.
1eta, for e4!onential smoothing. In order to erform e=onential smoothing with
trendB a smoothing $onstant must )e given 7in addition to alha8. If )eta is /B single
e=onential smoothing is erformed. If )eta is ositiveB e=onential smoothing
with trend is erformed as shown.
*nitial trend. In this modelB the trend will )e set to / unless it is initiali?ed. It
should )e set for the same time eriod as the initial fore$ast.
The solution s$reen for this te$hnique is different from the s$reens for the
reviousl3 des$ri)ed te$hniques. The fore$ast $omutations aear in the $olumn
la)eled Munad@usted fore$ast.L These num)ers are the same as in the revious
e=amle 7)e$ause we used the same value for alha8. The trend fore$asts aear in
the $olumn la)eled Mtrend.L The trend is the differen$e )etween the dou)l3
smoothed fore$asts from eriod to eriod 7weighted )3 )eta8. The fore$asts aear
in the $olumn mar:ed Mad@usted fore$ast.L
Note: Anfortunatel3B there are several different e=onential smoothing with trend
methods. 0hile the3 are all similarB the results will var3. ThereforeB it is ossi)le
that the results given )3 POM-QM for Windows will not mat$h the results of 3our
te=t. This is ver3 unfortunate )ut unavoida)le. If 3ou are using a Prenti$e Hall
te=tB )e $ertain that the software is registered 7"e%p, 6ser Infor!ation8 for that
te=t in order to get the mat$hing results.
49a!p%e +: ,rend ana%5sis
6s mentioned reviousl3B the solution s$reen for regression differs from the
solution s$reens for the other fore$asting te$hniques. 6 samle summar3 outut
using regression for the same data aears )elow.
3al'es for inde!endent (4) )ariable. ,or time4series regressionB the default values
are set to 1 through n and $annot )e $hanged. ,or aired regressionB the a$tual
values of the deendent varia)le need to )e entered 7see +=amle "8.
The s$reen is set u in order that the $omutations made for finding the sloe and
the inter$et will )e aarent. In order to find these values it is ne$essar3 to
$omute the sum of the 4
&
and the sum of the 4&. These two $olumns are resented.
*eending on the )oo:B either the sum of these $olumns or the average of these
$olumnsB as well as the first two $olumnsB will )e used to generate the regression
line. The line is given )3 the sloe and the inter$etB whi$h are listed at the )ottom
left of the s$reen. In this e=amleB the line that fits the data )est is given )3C
: W 1/4.33 V 1.1!%Q;
whi$h is read as MSales has a )ase of 1/4 with an in$rease of 1.1!% er wee:.L
If the data is sequentialB the ne=t eriod fore$ast is disla3ed. This is given )3
inserting one more than the num)er of eriods into the regression line. In the
e=amleB we would insert % into the re$eding equationB 3ielding 11%.33B as shown
on the s$reen at the )ottom of the fore$ast $olumn.
The standard error is $omuted and shown as with all other methods. In this
e=amleB it is 1./"-"B whi$h is )etter than an3 other method seen 3et. 6lso noti$e
that the mean squared error is disla3ed 743.41 in this e=amle8. The )ias isB of
$ourseB /B as linear regression is un)iased. 0e disla3 the summar3 s$reen as
follows.
(oti$e that the $orrelation $oeffi$ient and r4squared 7r[&8 $oeffi$ient are disla3ed
as outut. In the summar3 are the fore$asts for the ne=t several eriodsB sin$e this
was a trend anal3sis 7time series regression8.
The trend anal3sis grah has s$roll)ars whi$h ma:e it ver3 eas3 to modif3 the
sloe and inter$et of the line.
49a!p%e 3: Non ti!e series reression
Regression $an )e used on data that is $ausal. In the ne=t s$reenB we resent the
sales of um)rellas as a fun$tion of the num)er of in$hes of rain in the last four
quarters of the 3ear. The interretation of the solution s$reen is that the line that
)est fits this data is given )3 um)rella sales W 4-.-3 V &%.43 Q num)er of in$hes of
rain.
6)ove the data is a te=t)o= that ena)les us to la$e in a value for = to enter into
the regression equation. The solution aears in the summar3 ta)le 7not
disla3ed8. In our e=amleB if =W1/B then the summar3 ta)le indi$ates that 3W3&4.
49a!p%e G: Deco!position and Deseasona%i8ation
The following s$reen disla3s an e=amle with seasonal data. 6s $an )e seen in
the s$reenB there are 1& data oints.
Hou must enter the num)er of seasons su$h as 4 quarters or 1& months or ! or %
da3s. In additionB 3ou must enter the )asis for smoothing. Hou ma3 use either the
$entered moving average 7whi$h is $ommon8 or the average of all of the data. In
additionB 3ou $an have the software s$ale the seasonal fa$tors if 3ou li:e.
The solution s$reen $ontains several $olumns.
(entered mo)ing a)erage. The data is smoothed using a moving average that is as
long as the time eriod 4 4 seasons. 9e$ause the num)er of seasons is evenB the
weighted moving average $onsists of one4half of the end eriods and all of the
three middle eriods. ,or e=amleB for summer 1--"B the weighted average isC
\.!7-"8 V "1 V -! V -4 V .!7-38];4 W 1%.1%!
This average $annot )e ta:en for the first n;& eriods and )egins in eriod 3.
Demand to mo)ing a)erage ratio. ,or all of the data oints that have moving
averages $omutedB the ratio of the a$tual data to the moving average is $omuted.
,or e=amleB for summer &//&B the ratio is -!;1%.1%! W 1./111.
Seasonal factors. The seasonal fa$tors are $omuted as the average of all of the
ratios. ,or e=amleB the summer seasonal fa$tor is the average of 1./111 7summer
&//&8 and .--%1"% 7summer &//38B whi$h 3ields 1./3-1B as shown for summer
&//&B summer &//3B and summer &//4.
Seasonal 7actor Scaling. The four seasonal fa$tors are 1./""%B .113&B 1./3-1 and
1.1/4" whi$h sum to 4./&3" 7rather than 48. If we sele$t the otion in the area
a)ove the data to s$ale the fa$tors then our seasonal fa$tors will )e res$aled
7multilied )3 4;4./&3"8 and )e$ome 1./"/4B .1/14B 1./33 and 1./-1&B
rese$tivel3.
Smoothed data. The original data is divided )3 its seasonal fa$tor in order to ta:e
out the seasonal effe$ts and $omute the smoothed data.
+nad2'sted forecast. 6fter smoothing the data the software finds the trend line for
the smoothed data. This $olumn reresents the Jfore$astsE using this trend line.
The trend line itself $an )e found on the summar3 results s$reen.
/d2'sted forecast. The final $olumn 7)efore the error anal3sis8 ta:es the fore$asts
from the trend line and then multilies them )3 the aroriate seasonal fa$tors.
The errors are )ased on these ad@usted fore$asts versus the original data.
The summar3 ta)le $ontains the fore$asts for the $oming eriods.
0dditive Deco!position
0e do not disla3 the outut here. The additive model uses differen$es rather than
ratios to determine the seasonal fa$tors that are additive rather than multili$ative.
10dditive Deco!position
The last method availa)le is user4defined. This allows 3ou to enter the fore$asts
and let the software erform the error anal3sis. The same module is availa)le as
the fourth su)model when New is sele$ted.
Mu%tip%e Reression
6s noted earlierB the fore$asting module $an erform multile regression. There
are two inuts to the data. The num)er of eriods of data must )e givenF in
additionB the num)er of indeendent varia)les must )e given. In this first e=amleB
we will e=tend the regression ro)lem in +=amle ". (ote that for simle
regression 7one indeendent varia)le8 there are two su)models that $an )e used to
solve the ro)lem. +ither time4series anal3sis using the regression method or the
regression su)model.
49a!p%e J: Mu%tip%e Reression
In this e=amleB we have used two indeendent varia)les and therefore multile
regression must )e used. 0e have entered 4 for the num)er of eriods and & for
the num)er of indeendent varia)les.
0e have filled in the dataB and the solution s$reen aears ne=t. The inut has four
$olumnsC one for the name of the time eriodF one for the deendent varia)leB
um)rellasF one for the indeendent varia)leB rainF and one for the indeendent
varia)leB time 71 through 48. The outut disla3 is somewhat different from )efore.
The $omutations are not shown. The regression equation is not shown e=li$itl3
on this s$reen )ut $an )e found )3 loo:ing at the )eta $oeffi$ients )elow the ta)le.
That isB the equation is Am)rella sales W -1.&311 V &".!&31 Q Rain 411.-311Qtime.
This is shown e=li$itl3 on the summar3 s$reen that we do not disla3.
ProKectin
The third model in fore$asting allows us to ta:e a regression equation and ro@e$t
it. 'onsider the e=amle )elow.
0hen we set u the ro)lemB we indi$ated that there were five indeendent
varia)les and that we wanted to $reate three fore$asts. The regression line is given
)3 the first $olumn 7HW 1/ V 3=
1
V %=
&
V&1=
3
4 "=
4
V &=
!
8. The three $olumns
$ontain the data for =
1
through =
!
for ea$h of the three fore$asts to )e made. Row 1
$ontains a 1 sin$e this is for the inter$et. ,inall3B the )ottom row $ontains the
fore$asts whi$h are -4&B 1/11 and 1/1! for the three s$enarios.
14rror ana%5sis
1The last model $an )e used to enter )oth fore$asts and data in order to erform a
$omlete error anal3sis. The error anal3sis is identi$al to the ones disla3ed
)efore. The differen$e is that the software allows the user to enter the fore$ast
$olumn rather than rel3ing on one of the availa)le methods.
'hater "C #odules
2a!e ,heor5
6 ?ero sum game is given )3 a ta)le that gives the a3off to the row la3er 7la3er
18 from the $olumn la3er 7la3er &8. The game ta)le has one row for ea$h of the
row la3erEs strategies and one $olumn for ea$h of the $olumn la3erEs strategies.
'onsider the two la3er game given )3 the following ta)leC
Row;'olumn Strateg3 1 Strateg3 & Strateg3 3 Strateg3 4 Strateg3 !
Strateg3 1
Strateg3 &
1/
31
41&
!%
34
-"
%!
&1
"%
433
If the row la3er sele$ts strateg3 7row8 1 and the $olumn la3er sele$ts strateg3
7$olumn8 1B the $olumn la3er a3s the row la3er 1/. If the row la3er sele$ts
strateg3 1 and the $olumn la3er sele$ts strateg3 &B the $olumn la3er a3s 41& orB
in other wordsB the $olumn la3er re$eives 1& from the row la3er. Row and
$olumn must ea$h $hoose a strateg3 without :nowing what the oonent has
sele$ted.
Sometimes the solution is for the la3ers to alwa3s sele$t one strateg3 7termed a
ure strateg38 and sometimes the solution is for the la3ers to sele$t their
strategies randoml3 7termed a mi=ed strateg38. In either $aseB this $an )e
determined.
So%ution to the 49a!p%e
The solution for this e=amle is disla3ed ne=t.
Row should la3 the first strateg3 !3.&! er$ent of the time and the se$ond
strateg3 4".%! er$ent of the time. 'olumn should la3 the se$ond strateg3 !-.1%
er$ent of the time and the fifth strateg3 4/.13 er$ent of the time and never la3
--
PO#45# for 0indows
strategies 1B 3B or 4. If the3 follow these mi=esB the 7e=e$ted8 value of the game is
that $olumn will a3 row &/.&!44. That isB if the3 la3ed this game a large num)er
of times following their otimal mi=esB the a3offs would )e 41&B "%B !%B and 433B
and would average &/.&!44.
Ma9i!in and Mini!a9
0hen e=amining gamesB we usuall3 )egin )3 finding the ma=imin and minima=.
To find the ma=imin for the row la3erB e=amine ea$h row and find the worst
7minimum8 out$ome. These aear in the $olumn la)eled Mrow minimumL as 41&
and 433 in the following ta)le. Then find the )est of theseB 41&B whi$h is the
ma=imum of the minima or the ma=imin.
To find the minima= for the $olumn la3er e=amine ea$h $olumn and find the
worst 7ma=imum sin$e $olumn is a3ing8 a3off. These aear in the row named
M'olumn #a=imumL and are 31B !%B -"B %!B and "%. The minima= is the )est
7lowest8 of theseB or 31. The value of the game is )etween the ma=imin and
minima= as aears in this gameB with a value of &/.&!44B whi$h is )etween 41&
and 31.
49pected ?a%ues for Row
The ta)le )elow disla3s the $omutations 7multili$ations8 e=e$ted value for
ea$h of rowEs strategies. Sin$e row should use )oth strategiesB the e=e$ted values
are the same and mat$h the e=e$ted value of the game.
1//
'hater "C #odules
49pected ?a%ues for .o%u!n
Similarl3B if $olumn la3s $olumn & or !B $olumn will a$hieve the value of the
game. HoweverB if $olumn sele$ts $olumn 1B 3B or 4B then he or she will a3 more
than the value of the game as shown )3 the e=e$ted values in the ta)le )elow.
Grahs are availa)le if either or )oth la3ers have at most two strategies.
1/1
2oa% Prora!!in
Goal rogramming models are ver3 similar to linear rogramming modelsB )ut
whereas linear rograms have one o)@e$tiveB goal rograms $an have several
o)@e$tives. 'onsider the following e=amle.
Suose that a $oman3 manufa$tures two rodu$ts 741 and 4&8. The resour$e
requirements and rofit are rovided in the ta)le )elow
Produ$t 1 7418 Produ$t & 74&8 6vaila)le
Profit er unit
2a)or hours er unit
#aterial er unit
1"
3
&
1&
"
1
%&
3/
In additionB the $oman3 has the following goalsC
1. The total rofit should )e at least &!/.
&. It ta:es time to set u rodu$tion for Produ$t &B so we li:e to rodu$e in )at$hes
of at least !.
3. The $urrent demand for Produ$t 1 is 14. ThereforeB we would li:e to rodu$e
e=a$tl3 14.
This ro)lem aears similar to a linear rogramB )ut now we have three goals
rather than one o)@e$tive.
Data
6n3 goal rogram is defined )3 the num)er of varia)les and the num)er of
$onstraints or goals. *o not $ount the non4negativit3 restri$tions as $onstraints.
ThusB in this e=amleB we have two varia)les and five $onstraints;goals 7two
$onstraints and three goals8. The information is entered as shown in the following
s$reenC
Some of the information is identi$al to linear rogrammingB )ut there are some
differen$es. ,irst note that there is no o)@e$tive fun$tion. Se$ondB noti$e that there
are four e=tra $olumns at the )eginning 7left8 of the ta)le )efore the de$ision
varia)les. These e=tra $olumns are used for the goals and not for the $onstraints
7where 3ou $an see that the3 are ?ero8.
%oals<(onstraints. In ea$h line of the ta)leB we enter either a $onstraint or a goal.
The first two lines reresent $onstraints. Sin$e these are $onstraintsB the first four
$olumns are not used 7/s are entered8. The $onstraints are entered in the usual
fashion.
The ne=t three lines reresent goalsB and there are two ase$ts to these goals. Sin$e
these are goalsB noti$e that the sign in the row is MWL. The values under 41 and 4&
serve to $reate the goal in $on@un$tion with the varia)les dV and d4B indi$ating )3
how mu$h we overa$hieve or undera$hieve the goal. ,or e=amleB line 3 in the
ta)le stands forC
41 4 7d1V8 V 7d148 W 14.
If 41 is )elow 14B d14 reresents the amount )elowB )ut if 41 is a)ove 14B d1V
reresents the amount )3 whi$h we go over.
Similarl3B the ne=t line 7goal 48 reresentsC
1"41 V 1&4& 4 7d&V8 V 7d&48 W &%/
ThusB d&V and d&4 reresent the amount of rofit )e3ond &%/ and )elow &%/B
rese$tivel3.
#athemati$all3B the goals are d1VB d14B d&VB d&4B d3VB d34. The question isC How
do we want to order or weight these goalsX That isB how do we $ontrast the
imortan$e of ea$h of these si= goalsX
0e do this using the riorities and weights on the line.
Priorities and weightsC ,irstB there are si= goals 7 d1VB d14B d&VB d&4B d3VB d348 in
this e=amleB )ut we do not $are if we overa$hieve our rofit goal of &%/B nor do
we $are if we rodu$e more than five units of Produ$t &. ThereforeB )oth the
weights and riorities of these two goals have )een set to /. The riorities for the
other four goals range from 1 to 3. The meaning of different riorities is the order
in whi$h the goals are satisfied. In other wordsB goals with riorit3 1 must )e
satisfied )efore goals with riorit3 &B whi$h must )e satisfied )efore goals with
riorit3 3B and so on. In this e=amleB we first want to ma:e e=a$tl3 14 units of
Produ$t 1B then we want to guarantee our minimum rofit level of &%/B then we
want to tr3 to guarantee our minimum )at$h level of five for Produ$t &.
0ithin ea$h riorit3B it is ossi)le to assign different weights to the goals. This is
shown in the ne=t e=amle.
The constraint sign. This is a dro4down )o= that $an )e used to $hange the
$onstraint t3e from Mless than or equal toL to Mequal toL to Mgreater than or equal
to.L 6s stated a)oveB goals must have the sign MWL.
,ight-hand side coefficients. The values on the right hand side of the $onstraints
are entered here. ,or $onstraintsB these are the usual $oeffi$ientsB while for goalsB
these are the goals that are set.
,he So%ution
The following s$reen disla3s the summar3 solution 7the simle= goal ta)leau is
also availa)le for disla3B as is a grah for two4dimensional ro)lems8.
The otimal solution is to rodu$e 14 units of Produ$t 1 and & units of Produ$t &.
Priorit3 1 will )e a$hieved 7the nona$hievement is /8B while we have failed to
a$hieve riorities & and 3. Remem)erB dV is the amount )3 whi$h we have
e=$eeded the goalB and d4 is the amount )3 whi$h we have $ome u short. The
$onstraint anal3sis indi$ates that we used 11 fewer hours than we had availa)leB
e=a$tl3 the amount of material that we hadB rea$hed goal 3 e=a$tl3B undera$hieved
rofit 7goal;$onstraint 48 )3 && and )at$h si?e 3 7goal;$onstraint !8 )3 3. 6 grah
7not shown8 is also availa)le if the num)er of varia)les is two.
49a!p%e *: 6sin weihts
0e have revised our goal riorities as shown in the following e=amle. This time
we ma:e meeting the rofit level our highest goal and ever3thing else is
se$ondar3. HoweverB we have given twi$e the weight to undera$hieving our five
units of Produ$t &B $omared with missing our goal of 14 for Produ$t 1.
The results follow. 0e should rodu$e 1&.! units of Produ$t 1 and ! units of
Produ$t &. 0e will a$hieve our first riorit3 )ut miss our se$ond riorit3. 7The 1.!
reresents 14 4 1&.!8. (oti$e that we had onl3 two riorities.
The goal;$onstraint anal3sis shows us that we have 4.! la)or hours left overB used
e=a$tl3 the 3/ ounds of material that we hadB undera$hieved our Produ$t 1
demand )3 1.!B overa$hieved our rofit goal )3 1/B and met the goal of ma:ing at
least ! units of Produ$t & e=a$tl3.
Inteer and Mi9ed Inteer Prora!!in
6n3 integer or mi=ed integer linear rogram is defined )3 the num)er of varia)les
and the num)er of $onstraints. 6s with linear rogrammingB do not $ount the non4
negativit3 restri$tions as $onstraints. #ost student linear rogramming a$:ages
7e=$et +=$elEs Solver8 assume that the varia)les must )e non4negative.
'onsider the following integer rogramming e=amleC
ma=imi?e
su)@e$t to
3!/41
41
441
41B 4&
41B 4&
V !//4&
V 1.!4&
V 44&
^W /
integer
_W
^W
1!
/
The $omonents and the data entr3 are nearl3 the same as for linear rogramming.
The differen$e is that the inut s$reen has one e=tra row for identif3ing the t3e of
varia)le as either realB integer or /;1.
Ob2ecti)e f'nction. The $hoi$e of minimi?ation or ma=imi?ation is made in the
usual wa3 at the time of ro)lem $reationB )ut it $an )e $hanged on the data s$reen
using the o)@e$tive otions a)ove the data.
Ob2ecti)e f'nction coefficients. The $oeffi$ients 7t3i$all3 referred to as c
@
8 are
entered as numeri$al values.
(onstraint coefficients. The main )od3 of information $ontains the $onstraint
$oeffi$ientsB whi$h t3i$all3 are $alled the a
i@
s. These $oeffi$ients ma3 )e ositive
or negative.
The constraint sign. This $an )e entered in one of two wa3s. It is ermissi)le to
ress the N_O :e3B the N^O :e3B or the NWO :e3. 0hen 3ou go to a $ell with the
$onstraint signB a dro4down arrow aears in the $ell and $an )e used.
,ight-hand side coefficients. The values on the right4hand side of the $onstraints
are entered here. These are also termed the b
i
s. The3 must )e non4negative.
The )ariable t&!e. This is a dro4down )o= that will $hange the varia)le t3e from
MintegerL to MrealL to M/;1.P Hou $an $hange all varia)les at on$e )3 $li$:ing on
the leftmost $olumn. This is ver3 useful for $aital )udgeting ro)lems.
Ma4im'm n'mber of iterations and Ma4im'm le)el (de!th)C If 3ou re$eive a
message regarding the num)er of iterations or deth rather than a solution 3ou ma3
in$rease these num)ers
,he So%ution
The solution is given )3 a simle s$reen with the varia)les and their values.
Iterations
The iterations $an )e found in another s$reen. The 2P solution to the original
ro)lem 7see iteration 1B level /8 had 41 and 4& )oth as nonintegers. 0e then
)ran$hed on 41 )3 adding the $onstraint 41_W1/. The 2P solution to this ro)lem
had 41 as an integer )ut 4& was nonintegerB so we )ran$hed on 4& )3 adding the
$onstraint 74&_W38. This 3ields an integer solution 7iteration 38. 0e $reate the
other )ran$h )3 adding 74&^W48 and this 3ields an even )etter integer solution. 0e
go )a$: to the original node and $reate the )ran$h 41^11B whi$h 3ields an
infeasi)le solution. ThereforeB we are done.
6 grah 7not shown8 is availa)le for this module.
49a!p%e of a !i9ed inteer prora!
'onsider the following e=amleC
ma=imi?e 3/4 V 33& V !/5
su)@e$t to &34V 43& V 1"5 _W 1///
3&4 V 33& V &!5 _W &!//
434 V !3& V &"5 _W 1!//
4, &, 5 ^W /
4 integerB
5 /;1
6gainB the $omonents are identi$al to linear and integer rogramming e=$et that
there is one e=tra row of information that needs to )e given indi$ating the t3e of
ea$h varia)le 7realB integerB or /;18.
,he So%ution
The varia)le t3es and their values are disla3ed.
NO,4C 2inear rogram $an )e entered and solved as mi=ed integer rograms )ut
the ranging ta)le and linear rogramming iterations will not )e availa)le.
Inventor5
These models use different variations of the e$onomi$ order quantit3 7+O58
model in order to determine roer order or rodu$tion quantities. 9esides the
standard +O5 modelB we in$lude the e$onomi$ rodu$tion quantit3 7+P58 model.
,or )oth the +O5 and +P5 modelB we allow shortages to )e in$luded. ,inall3B we
allow quantit3 dis$ounts for the +O5 model.
6 se$ond t3e of model is 69' anal3sis.
The last two models are used for $omuting reorder oints for (ormal
distri)utions and dis$rete distri)utions.
4OQ-,5pe Mode%s
The following s$reen $ontains an e=amle that in$ludes )oth the data and the
solution.
,he Data
Demand rate. The rate of demand or usage is to )e entered here. T3i$all3B this
demand rate is an annual rate )ut it does not need to )e. The time units for this
demand rate must mat$h the time units for the holding $ost.
Set'! cost. This is the fi=ed $ost of la$ing ea$h order or ma:ing ea$h rodu$tion
run.
$olding cost rate. This is the $ost of holding or $arr3ing one unit of inventor3 for
one time eriod. This $ost is either given as a arti$ular dollar amount or given as
a er$entage of the ri$e of the item.
NO,4: If 3ou want the holding $ost to )e a er$entage of the unit $ostB enter a
er$ent signB MZLB after the num)er. ,or e=amleB M&/P means &/ dollarsB )ut
M&/ZL means &/ er$ent of the unit $ost. If the holding $ost is a er$entage of the
unit $ostB 3ou must enter the unit $ost.
+nit cost. This is sometimes ne$essar3B )ut man3 timesB it is not )e$ause the +O5
is indeendent of the unit $ost.
,eorder !oint. The otion )o= a)ove the data ena)les us to $al$ulate the reorder
oint. Three lines of inut are added in these $ases. 0e must either enter a dail3
demand rate or enter the num)er of da3s in the 3ear so that the dail3 demand rate
$an )e $omuted from the annual demand rate. In additionB we must enter the
num)er of da3s for the lead time.
Order 9'antit&. 6)ove the data is a te=t)o=;s$roll )ar $om)ination that allows 3ou
to enter a value for the order quantit3. If 3ou enter a num)er other than /B then two
sets of results will )e disla3ed. One $olumn will )e for the +O5B while the other
$olumn will )e for the se$ified order quantit3.
,he So%ution
The outut s$reen aears in the re$eding s$reen. In +=amle 1B we have solved a
standard +O5 model andB in additionB found results when using an order quantit3
of &/ units. The model results are as followsC
O!timal order 9'antit&. This is the most e$onomi$al order quantit3. If there is no
quantit3 dis$ountB this is the +O5. HoweverB when a quantit3 dis$ount is availa)le
7as in +=amle 38B this is either the +O5 or a dis$ount oint a)ove the +O5. In
this e=amleB the otimal order quantit3 is 1".33 units er order.
Ma4im'm in)entor& le)el. It is useful to :now the largest amount that will )e in
inventor3. In the standard +O5 modelB this is siml3 the amount that is orderedF in
a rodu$tion or shortage modelB this is less. In this e=amleB the inventor3 will
never e=$eed 1".33 units when using the +O5 or &/ units if &/ is the order
quantit3.
/)erage in)entor& le)el. If there are no )a$:ordersB the average inventor3 is half of
the ma=imum inventor3. 6nnual holding $osts are )ased on the average inventor3.
Orders !er &ear. The assumed time eriod is one 3earB and the num)er of orders is
disla3ed. In this e=amleB it is 1&.&! for the +O5 and 1/ for an order quantit3 of
&/ units.
+nit costs. This is the total $ost for ordering the units. In man3 instan$esB the
individual unit $ost will )e /B andB thereforeB the total unit $osts will )e /.
Total costs. This is the total $ost of )oth the inventor3 $osts and the unit $osts.
This figure is useful for $he$:ing wor: on ro)lems with dis$ounts.
,eorder !oint. This is the rodu$t of the dail3 demand rate and the num)er of
leadtime da3s. In this e=amleB we have a dail3 demand rate of .1 units and a lead
time of ! da3sB whi$h 3ields a reorder oint of 4 units.
6 grah of $ost versus inventor3 is disla3ed ne=t.
49a!p%e *: Inventor5 with production
In the following e=amleB we disla3 data for a ro)lem with rodu$tion. The data
in$ludes the usual arameters of demand rateB setu $ostB holding $ostB and unit
$ost. 0e also are disla3ing results for a oli$3 of rodu$ing 3// units er run. In
this e=amle we have set the holding $ost to &/Z of the unit ri$e. In additionB in
this modelB we are as:ed for a dail3 rodu$tion rate and either a dail3 demand rate
or the num)er of da3s er 3ear. (oti$e in this e=amle that we have set the da3s
er 3ear to &!/. The rogram will $omute the dail3 demand rate as 1/B///;&!/.
6lternativel3B we $ould have entered the dail3 demand rate to $omute the da3s
er 3ear.
The solution aears ne=t. The dail3 demand rate has )een found to )e 4/. The
remaining results are the same as in the first e=amle. (oti$e that the holding $ost
has )een $omuted as U11 )ased on &/Z of the U-/ unit $ost.
49a!p%e (: Quantit5 discounts
6 s$reen for quantit3 dis$ounts aears in the following illustration. The usual
information is la$ed at the to. In additionB the num)er of ri$e ranges must )e
given at the time of ro)lem $reation..
6 detailed anal3sis of the order quantities and $osts at ea$h ri$e range is
availa)leB as shown )elowC
Dac7order Mode%s
The software also has the $aa)ilit3 to $omute the +O5 or the rodu$tion model
with )a$:orders. These models do not aear in all te=t)oo:sB so we do not
disla3 them in this manual. If 3ou have the software set for one of the Render
te=tsB then these models will not show u in the model su)menu.
0D. 0na%5sis
The goal of 69' anal3sis is to identif3 the most imortant items that are :et in
inventor3. Imortan$e is measured )3 dollar volume. 6n e=amle aears )elow
for a ro)lem with si= items.
,or ea$h itemB the information to )e entered isC
*tem name. 6s usualB a name $an )e entered on ea$h line.
Demand. The demand rate for ea$h item is to )e given.
*tem !rice. The $ost or ri$e of ea$h item is to )e given
Percentage of / and 1 items. In the e=amleB we want &/ er$ent of the items to
)e 6 items and 3/ er$ent to )e 9 items. 6fter the rogram sorts the items )3
dollar volumeB the first &/ er$ent of " items 7." items rounded to 18 will )e
$lassified as an 6 item and then 3/ er$ent of " 71.1 items rounded to &8 will )e
$lassified as 9 items.
(oti$e that the items are sorted a$$ording to their dollar4volume er$entages. That
isB the3 do not aear in the same order as on the original s$reen of inut. The
outut $omuted for ea$h item isC
Dollar-)ol'me. This is the demand multilied )3 the ri$e for ea$h item
Dollar-)ol'me !ercentage. This is the item dollar4volume divided )3 the;total
dollar volume.
('m'lati)e dollar-)ol'me !ercentage. This is a running total of dollar volume
when the items are sorted from highest dollar volume to lowest dollar volume.
(ategor&. This is the $lassifi$ation as e=lained a)ove.
Reorder Points for the Nor!a% distri-ution
9elow is the solution s$reen for $al$ulating the safet3 sto$: and reorder oint for
the $ase where demand during lead time is given )3 a (ormal distri)ution. The
solution s$reen in$ludes the inut on the left.
Dail& demand. This is the dail3 demand rate during the lead time.
Demand standard de)iation. This is the standard deviation for the dail3 demand
rate. If the dail3 demand rate is fi=ed enter a standard deviation of /.
Ser)ice =e)el. This is the er$entage of demands whi$h should )e met.
=ead time in da&s. This is the lead time in da3s.
=ead time standard de)iation. This is the standard deviation of the lead time. If the
lead time is fi=ed enter / for the standard deviation.
NO,4: The disla3 for Hei?er;Render is )ased on a given lead time demand and
standard deviation and has onl3 three inuts. In generalB to use the disla3 a)oveB
if the ro)lem has a given lead time demand and standard deviation then set the
lead time da3s to 1 and lead time standard deviation to /.
Reorder Points for a Discrete distri-ution
,eorder !oint w<o safet& stoc-. This is the reorder oint rior to $onsideration of
safet3 sto$:. In this e=amleB our initial lan is to reorder when the inventor3 falls
to %/. ThusB if the demand during the lead time does not e=$eed %/ we will not
have an3 sto$:outs. Sin$e the ma=imum demand is -/ and our reorder oint is %/
our ma=imum safet3 sto$: will )e &/ units.
(arr&ing cost !er &ear. This is the usual $ost of $arr3ing inventor3. In this
e=amle it is U% er unit er 3ear.
Stoc-o't cost. This is the $ost er unit of not )eing a)le to meet the demand. In
this $ase it is U11 ea$h time that we are short a unit.
Orders !er &ear. This is the num)er of times er 3ear we erform the ordering
ro$ess. In this e=amle we la$e orders twi$e a 3ear.
Probabilit& distrib'tion. This is the $olumn of lead time demands and their
asso$iated ro)a)ilities.
The results are )elowB indi$ating that the minimal $ost safet3 sto$: is 1/ and thus
the revised reorder oint is the original %/ lus the 1/ for a total of 1/ units.
Sin$e our original reorder oint is !/ and our lead time demands var3 from%/ to
11/ we need a ma=imum of 7-/4%/8 &/ units as safet3 sto$: so the results are
given for values )etween / and &/ units. In ea$h of these 3 $asesB the $arr3ing
$ostsB sto$:out $osts and total $osts are $omuted and disla3ed. 9elow the
$omutations are the summar3 results.
#o- Shop Schedu%in BSe:uencinC
The @o) sho s$heduling models are used to solve one4and two4ma$hine @o) sho
ro)lems. ,or the one4ma$hine ro)lem the availa)le methods are shortest
ro$essing timeB first $ome first serveB due date s$hedulingB #ooreEs methodB sla$:
timeB sla$: er oerationB longest ro$essing timeB and $riti$al ratio. ,or two4
ma$hine s$hedulingB >ohnsonEs method is used to minimi?e the ma:esan.
One-Machine Schedu%in
'onsider the following one4ma$hine s$heduling ro)lem. ,ive emlo3ees are to )e
trained to oerate different ma$hines )3 a single trainer who $an train onl3 one
erson at a time. The time to train ea$h erson varies and is given in the
a$$oman3ing ta)le along with due dates and the num)er of oerations involved.
>o) Time *ue *ate (um)er of Oerations
>anet
9arr3
6le=is
Samm3
2isa
+rnie
3 da3s
!
4
%
-
&
4
%
13
1/
1!
!
&
4
1
&
1
3
9oth the data and a solution aear in the ne=t s$reen.
Methods (!riorit& r'les). The rules availa)le for s$heduling in$ludeC
1. Shortest ro$essing time 7SPT8
&. ,irst $ome first serve 7,',S8
3. +arliest due date 7*ue *ate8
4. Sla$: time 7Sla$:8
!. Sla$: er oeration 7Sla$:;o8
". #ooreEs method 7#oore8
%. 2ongest ro$essing time 72PT8
1. 'riti$al ratio 7'rit rat8
The data to )e entered areC
Starting da& n'mber. 6n otional starting da3 num)er ma3 )e given. +=amle &
will disla3 the use of this otion.
Date recei)ed. It is ossi)le to list the date ea$h @o) is re$eived. This information
will )e used in s$heduling when ,irst 'ome ,irst Served is used. If re$eit dates
are given then the3 will )e used in the $omutation of the flow times 7see e=amle
&8. The re$eit da3s must )e less than or equal to the starting da3. That isB all @o)s
must )e re$eived )efore the starting date.
>ob names. (ames $an )e entered for ea$h @o).
Machine name. The word Mma$hine 1L at the to of the $olumn $an )e $hanged to
give the name of the t3e of ma$hine. In this e=amleB the ro$ess has )een
renamed MTrainingL.
Processing time. The amount of time that ea$h @o) will ta:e on ea$h ma$hine is
entered in the $olumn la)eled with the ma$hine name.
D'e date. In some instan$esB due dates are used. These are entered here.
8'mber of o!erations. In order to use the sla$: er oeration ruleB it is ne$essar3
to give a ositive num)er of oerations. ,or an3 other method this $olumn $an )e
ignored.
49a!p%e /: Shortest processin ti!e
The results deend on the rule that is $hosen. In our first e=amleB we have $hosen
shortest ro$essing timeB )ut in going through the e=amles all of the information
that will )e disla3ed is e=lained. The outut for our first e=amle is shown in
the re$eding s$reen.
>ob order. 6 $olumn is disla3ed that shows when ea$h erson 7@o)8 will )e
trained 7ro$essed8. In +=amle 1B the $olumn shows that >anet will )e se$ondB
9arr3 fourthB 6le=is thirdB Samm3 fifthB 2isa si=thB and +rnie will )e first.
Se9'ence. The same sequen$e is disla3ed )ut in a different manner at the )ottom
of the s$reen. In this e=amleB the sequen$e is +rnie followed )3 >anetB 6le=isB
9arr3 Samm3B and 2isa.
7low time. The time at whi$h ea$h @o) ends is given in a $olumn of flow times. In
the e=amleB +rnie is the first one trained and ends after the ro$essing time of &
da3s. >anet is the se$ond trained and ends after 3 more da3s at time !. The last @o)
erformedB 2isaB ends after 3/ da3s.
(om!letion time. If the starting da3 is not /B a $olumn of $omletion times is given
that in$ludes the starting da3 7see +=amle 18.
Tardiness or lateness. If due dates are givenB the differen$e )etween the flow time
and the due date is disla3ed. 7On the s$reen the disla3 is in red.8. This differen$e
will never )e )elow /. There is generall3 no su$h thing as earl3 in s$heduling.
Totals. ,or )oth the flow time and the latenessB the totals are $omuted and
disla3ed.
/)erages. #ore relevant than the totals are the averages. The average flow time
reresents the seed with whi$h @o)s leave the s3stem after the3 have entered. The
average lateness 7tardiness8 reresents how )adl3 the s$hedule is erforming with
rese$t to our romised due dates.
NO,4: The average lateness is $omuted )ased on all @o)sB not @ust the @o)s that
are late. In the e=amleB it is 34;"B even though +rnie was trained on time.
/)erage n'mber of 2obs in the s&stem. This is $omuted as the total flow time 7on
or after the starting da38 divided )3 the ma=imum flow time.
2antt .hart
6 Gantt $hart illustrating the s$heduling on the ma$hine is availa)leB as seen in the
following s$reenC
Su!!ar5
One of the outut windows for one ma$hine s$heduling is a summar3 of results for
all methods as disla3ed )elow.
49a!p%e *: First co!e first served
In this e=amleB we have $hanged our rule to ,irst 'ome ,irst Served and in
addition we have la$ed re$eit da3s for the @o)s and a starting da3 of 1//.
The results are )elow.
Sin$e the first $ome first served 7,',S8 otion is sele$tedB the rogram will
s$hedule the @o)s a$$ording to the re$eit da3.
(oti$e that there is an e=tra $olumn of results named M'omletion timeL. This is
the flow time lus the starting da3 minus 1. ,or e=amleB 2isaEs @o) )egan at the
)eginning of da3 1//B was wor:ed on for - da3s and therefore was finished at the
end of da3 1/1. 'omletion times are at the end of that da3.
49a!p%e (: Schedu%e accordin to s%ac7
Sla$: is defined as the due date minus the time required to ro$ess a @o). In order
to use sla$:B the due date must )e given.
The sla$: $olumn did not aear )efore )ut does now. It is the differen$e )etween
the due $olumn and the MtrainingL $olumn. ,or e=amleB >anet must )e trained )3
da3 4 )ut it ta:es 3 da3s to trainB so there is one da3 of sla$:. The @o)s are
s$heduled a$$ording to in$reasing order of sla$:. >anet has the least and is
s$heduled firstB while 6le=is has the most 7-8 and is s$heduled last. The solution
aears )elow.
49a!p%e 1: S%ac7 ti!e per operation
0e have used the data in the num)er of oerations $olumn. The outut 7not
shown8 $ontains a new $olumn titled sla$:;oB whi$h is generated )3 dividing the
sla$: )3 the num)er of oerations. ,or e=amleB the 1 da3 of sla$: for @o) 1 is
divided )3 the & oerationsB 3ielding a sla$: er oeration value of .!. >o)s are
s$heduled a$$ording to in$reasing order of sla$: er oeration. ThereforeB >anet is
first 7.!8 and 6le=is is last 7-8. 7Ties are )ro:en ar)itraril3.8
49a!p%e +: Due date schedu%in
>anet is the first one due and is s$heduled firstB while 2isa is the last one due and is
s$heduled last.
49a!p%e 3: MooreIs !ethod
#ooreEs method minimi?es the num)er of late @o)s. In the e=amle shown ne=tB
#ooreEs method leads to the sequen$e >anetB +rnieB 2isaB Samm3B 6le=isB and
9arr3B whi$h has three @o)s late. (o s$hedule will have fewer than three @o)s late
as $an )e seen in the summar3 ta)le disla3ed at the end of e=amle 1.
49a!p%e G: Aonest processin ti!e
The 2PT method s$hedules @o)s from longest to shortest. This is t3i$all3 the
worst wa3 to erform s$heduling. In the e=amle 7not shown8B 2PT 3ields the
sequen$e 2isaB Samm3B 9arr3B 6le=isB >anetB +rnieB whi$h is e=a$tl3 oosite the
SPT s$hedule of $ourse. This s$hedule has an average flow time of &1.!. (o
s$hedule will have a larger average flow time. This s$hedule has 4.3 @o)s in the
s3stem on average. (o s$hedule will have a larger average num)er of @o)s in the
s3stem.
49a!p%e J: .ritica% ratio
The $riti$al ratio is defined as 7due date 4 toda38;ro$essing time. This is the first
e=amle in whi$h we have used the starting da3 num)er a)ove the data. >o)s are
s$heduled in as$ending order of the $riti$al ratio. In this e=amleB the s$hedule is
>anetB 9arr3B Samm3B +rnieB 2isaB 6le=is. (oti$e in the s$reen that there is an e=tra
$olumn of oututB $omletion time. 9e$ause @o)s do not start at time /B the flow
time and the $omletion time are different. ,or e=amleB >anet is the first @o) done
and )egins toda3 on da3 3. Sin$e it ta:es 3 da3sB we wor: on >anet on da3s 3B 4B
and !B whi$h )e$omes the $omletion time. The @o) is one da3 late.
,wo-Machine Schedu%in
'onsider the following ro)lem. 6 t3ing $enter needs to t3e and rint @o)s for
seven $ustomers. The length of time that ea$h @o) requires for final $orre$tions
7t3ing8 and for rinting is disla3ed in the following ta)le. +a$h @o) must first
have the t3ing finished )efore it $an )e duli$ated.
'ustomer T3ing *uli$ating
Harr3
*e)
2eah
*ara
6rt
Sharon
Riv:a
&/ minutes
43
3%
"&
1/
1&
&!
1- minutes
&%
31
11
!&
3"
41
In the ne=t s$reenB we demonstrate the two4ma$hine ro)lem. >ohnsonEs method is
usedB and the order and sequen$e are listed as follows.
In additionB the time at whi$h ea$h @o) ends on ea$h ma$hine is disla3ed. The
largest of all of these times is the ma:esanB or time at whi$h all wor: is
$omletedF it is disla3ed at the )ottom. In this e=amleB it will ta:e &-/ minutes
to finish the wor:.
#ohnsonIs Method Steps
6 se$ondar3 outut for this su)model is the disla3 of the order in whi$h @o)s
were $hosen a$$ording to >ohnsonEs method. This is disla3ed in the following
s$reen.
The smallest time among the 14 times was 11 minutes for *ara on *uli$ating.
ThusB *ara is s$heduled last sin$e duli$ating is the se$ond ma$hine. The ne=t
smallest time among all $ustomers e=$et *ara is 1& for Sharon on T3ing. Sin$e
T3ing is the first ro$essB Sharon is s$heduled first. The method $ontinues to find
the smallest time of all uns$heduled $ustomers and s$hedules the $ustomer as soon
as ossi)le if the time is on T3ing and as late as ossi)le if the time is on
*uli$ating.
6 two4ma$hine Gantt $hart $an )e disla3ed also as shown )elow. If the name of
the @o) is too long for the )ar in the $hartB then it will )e trun$ated. ,or e=amleB
see Sharon on ma$hine 1.
Aa5out
The fa$ilit3 la3out model is used to la$e deartments in rooms in order to
minimi?e the total distan$e traveled as a fun$tion of the distan$es )etween the
rooms and the flow )etween deartments. In some $asesB it is ne$essar3 to fi=
$ertain deartments to )e lo$ated in se$ifi$ rooms. *istan$es )etween rooms ma3
or ma3 not )e s3mmetri$. 7Asuall3 the3 areB )ut this is not required.8
Data
The framewor: for la3out is given )3 the num)er of deartments or the num)er of
rooms that we assume to )e the sameB sin$e ea$h deartment must )e assigned to
one and onl3 one room.
The data that follows essentiall3 $onsists of two ta)les of num)ersB one for the
flows and one for the distan$es.
Method. There are two methods availa)le. The default method is e=li$it
enumeration. This is guaranteed to find the otimal solution. Anfortunatel3B if the
ro)lem si?e is too large this method will ta:e too mu$h time. 6 se$ond methodB
airwise $omarison is availa)le. Anfortunatel3B this method is not guaranteed to
alwa3s find the )est la3out.
*nterde!artmental flows. The num)er of tris from one deartment to another is
indi$ated in a ta)le termed the flow matri=.
Distance matri4. The distan$e )etween rooms is entered in this ta)le. T3i$all3 the
distan$e matri= will )e s3mmetri$. The $hoi$e is made at the )eginning of the
module. That isB the distan$e from room i to room 2 is the same distan$e as for
room 2 to room i.
6 samle set of data aears in the re$eding s$reen. (oti$e in this e=amle that
the distan$es are s3mmetri$.
So%ution
The solution siml3 is to assign the deartments to the aroriate rooms. The
total movement is also noted.
,oom assignments. On the right of ea$h deartment row will aear the room in
whi$h the deartment should )e la$ed. In our e=amle #aterials should )e la$ed
in room &B 0elding in room 1B et$.

Total mo)ement. The sum of the rodu$ts of the num)er of tris multilied )3 the
distan$e is listed at the to. This is what we are tr3ing to minimi?e. (oti$e that for
our e=amle the minimum total movement is 13B///.
It is ossi)le to disla3 the individual multili$ations of room4to4room distan$es
)3 ro$ess4to4ro$ess flows. This is shown 7artiall38 in the s$reen that follows.
In order to demonstrate airwise $omarison we have ta:en the same e=amle )ut
$hanged the method and solved it. The results are disla3ed )elow. (oti$e
thatB indeedB airwise $omarison did not find the otimal solution sin$e the
movement under airwise $omarisonB 1!&//B is larger than the movement
under e=li$it enumeration.
Fi9in Depart!ents in Specific Roo!s
If the room name aears in the $olumn la)eled M,i=ed RoomBL that deartment
will )e fi=ed in that room. Suose that in our revious e=amle we are required
to have #aterials la$ed in room 1. ThenB to a$$omlish thisB we la$e Mroom 1P
in the row for #aterials in the M,i=ed RoomL $olumn using the dro4down )o=.
The solution follows. The room assignments areB of $ourseB differentB and the total
movement isB of $ourseB greater than the otimal solution for the unrestri$ted
ro)lem.
Aearnin B49perienceC .urves
Two models are availa)le for learning $urves. In the first modelB it is assumed that
the learning $oeffi$ient is :nownF in the se$ond modelB it is assumed that the
rodu$tion time for two units is :nownB and that the learning $urve $oeffi$ient is
$omuted )ased on these. In either $aseB we $an find the rodu$tion times for units
from 1 to a se$ified num)er and the $umulative rodu$tion time for these units.
In additionB for either model the learning $urve $an )e grahed.
,he Data
'onsider a situation in whi$h unit 1 too: 1/ hoursB the learning $urve $oeffi$ient is
-/ er$ent and we are interested in the first &/ units. ,ollowing is a s$reen that
$ontains )oth the data and the one line of rimar3 oututC
+nit n'mber of base 'nit. This is usuall3 1 as in our e=amleB )ut it $an )e set to
an3 num)er.
Time for base 'nit. This is the length of time that it ta:es to manufa$ture the unit
num)er as se$ified a)ove. In our e=amleB it is 1/ hours.
8'mber of the last 'nit. This is the item num)er for the last unit whi$h will )e
disla3ed and;or used for $omutations. In the e=amleB we are interested in unit
&/ or the first &/ units.
=earning c'r)e coefficient. This is a num)er )etween / and 1. It is the er$entage
of the first unitEs time that it ta:es to ma:e the se$ond unit and also the er$entage
of the se$ond unitEs time that it ta:es to ma:e the fo'rth unit. The learning $urve
$oeffi$ient is onl3 entered for the first model. The se$ond model will determine
the learning $urve $oeffi$ient )ased on the ne=t data inut item.
Time to ma-e last 'nit. (ot shown on this s$reenB )ut shown in the ne=t e=amleB
the last ie$e of information for the se$ond model is the time it ta:es to rodu$e
the last unit rather than the learning $urve $oeffi$ient. 9ased on this ie$e of
informationB the learning $urve $oeffi$ient will )e determined 7see +=amle &8.
49a!p%e /: .o!putin ti!es and cu!u%ative ti!es
The samle ro)lem aears in the re$eding s$reen. The four lines of inut data
indi$ate that the first unit 7unit num)er 18 ta:es 1/ minutes to manufa$tureB the last
unit is unit num)er &/B and the learning $oeffi$ient is -/ er$ent. That isB the
de$rease in time is su$h thatB with the dou)ling of the unit num)erB the time is -/
er$ent of the revious time.
The solution in the re$eding s$reen is that the last unit 7num)er &/8 ta:es ".34
minutes.
6n additional ta)le of times and $umulative times $an )e disla3ed. The outut
$onsists of three $olumns.
+nit n'mber. This runs from 1 to the last unitB whi$h in our e=amle is &/. The
two additional $olumns are as followsC
Time to !rod'ce a single 'nit (!rod'ction time). This $olumn $ontains the time to
rodu$e a unit. ,or e=amleB it ta:es 1/ minutes to rodu$e unit 1 7as se$ified )3
the inut8B - minutes to rodu$e unit & 7as $omuted using the learning
$oeffi$ient8B 1.1 minutes to rodu$e unit 4 7-/ er$ent of - minutes8B %.&- minutes
to rodu$e unit 1B and so on. The interesting num)ers are the ones that are not
owers of &. ,or e=amleB it ta:es ".34 units to rodu$e unit &/.
('m'lati)e time. The last $olumn $ontains the amount of time to rodu$e all of
the units u to and in$luding that unit num)er. O)viousl3B it ta:es 1/ minutes to
rodu$e unit 1. It ta:es 1- minutes to rodu$e units 1 and &F 3!.&/ minutes to
rodu$e the first four unitsF and 14"./1 minutes to rodu$e the first &/ units. 6
grah of the unit rodu$tion times $an )e disla3ed. The s$roll)ar $an )e used to
see the effe$ts of the learning $oeffi$ient on the grah.
49a!p%e *: Findin the %earnin curve coefficient
,ollowing is the solution s$reen for an e=amle of the se$ond model. In this $aseB
we :now that unit 4 too: %3 minutes and unit 3% too: "1 minutes. The rogram
has $omuted thatB )ased on these two timesB the learning $urve $oeffi$ient is .
-%11.
Ainear Prora!!in
6n3 linear rogram is defined )3 the num)er of varia)les and the num)er of
$onstraints. *o not $ount the non4negativit3 restri$tions as $onstraints. #ost linear
rogramming a$:ages 7)ut not +=$elEs Solver8 assume that unless told otherwise
the varia)les must )e non4negative.
'onsider the following e=amle with two $onstraints and two varia)lesC
ma=imi?e 34 V 3&
su)@e$t to 34 V 4& _W 14 7la)or hours8
"4 V 4& _W 1! 7l)s material8
4B & ^W /
The data s$reen for this aears ne=t. 0e show the entire s$reen so that we $an
oint out that a ST+P tool now aears on the tool)ar )efore the SO2.+ tool.
6lsoB Step is ena)led in the Fi%e menu.
Ob2ecti)e f'nction. The $hoi$e of minimi?ation or ma=imi?ation is made in the
usual wa3 at the time of ro)lem $reationB )ut it $an )e $hanged on the data s$reen
using the o)@e$tive otions a)ove the data.
Ob2ecti)e f'nction coefficients. The $ost;rofit $oeffi$ients 7t3i$all3 referred to as
c
@
8 are entered as numeri$al values. These $oeffi$ients ma3 )e ositive or negative.
(onstraint coefficients. The main )od3 of information $ontains the $onstraint
$oeffi$ientsB whi$h t3i$all3 are $alled the a
i@
s. These ma3 )e ositive or negative.
,ight-hand side (,$S) coefficients. The values on the right4hand side of the
$onstraints are entered here. These are also termed the b
i
s. These must )e non4
negative.
The constraint sign. This $an )e entered in one of two wa3s. It is ermissi)le to
ress the N_O :e3B the N^O :e3B or the NWO :e3. 6lternativel3B when 3ou go to a $ell
with the $onstraint signB a dro4down arrow aears in the $ellB as shown in the
following s$reen in $onstraint & in the $olumn with the $onstraint signs.
Hou $an $li$: on the arrow )ringing in a dro4down )o= as shown ne=tC
09'ation form. The $olumn on the far right disla3s the equation form of the
$onstraint and $an not )e dire$tl3 edited )ut $hanges as the $oeffi$ientsB $olumn
nameB sign or right hand side $hange.
,he So%ution
,ollowing is the solution to our e=amle. Please note that the disla3 varies
somewhat a$$ording to the te=t)oo: otion sele$ted in "e%p, 6ser Infor!ation.
O!timal )al'es for the )ariables. Anderneath ea$h $olumnB the otimal values for
the varia)les are given. In this e=amleB 4 should )e .33 and & should )e 3.&!.
O!timal cost<!rofit. In the lower right hand $orner of the ta)leB the ma=imum
rofit or the minimum $ost is given. In this e=amleB the ma=imum rofit is
U1/.%!.
Shadow !rices. The shadow 7or dual8 ri$es aear on the right of ea$h $onstraint.
In this e=amleB we would a3 .! more for one more unit of resour$e 1 and .&!
more for one more unit of resour$e &.
,he raph
One of the other outut disla3s is a grah as shown in the following s$reen. The
feasi)le region is shaded. On the right is a ta)le of all of the feasi)le $orner oints
and the value of the o)@e$tive fun$tion 7?8 at those oints. In additionB the
$onstraints and o)@e$tive fun$tion $an )e highlighted in red )3 $li$:ing on the
otion )uttons on the right under M'onstraint *isla3.L
,a-%e of Ranes
In addition to listing the valuesB we have rovided additional information a)out the
varia)les. The interretation of the additional information is left for 3our te=t)oo:.
In the e=amleB 3ou $an see the redu$ed $ostB original o)@e$tive value $oeffi$ientB
and the lower and uer limit 7the range8 over whi$h the solution will )e the same.
That isB the varia)les will ta:e on the same values of .333 and 3.&!F onl3 the
o)@e$tive fun$tion value 7rofit or $ost8 will $hange.
NO,4: Some te=ts and other rograms give the allowa)le de$rease and in$rease
7from the original value8 rather than the uer and lower limits on the ranges.
Iterations
The iterations $an also )e disla3ed. The ta)leau st3le varies a$$ording to the
te=t)oo: sele$ted.
So%ution Aist
It is also ossi)le to disla3 the solution in a listB as shown ne=tC
,he dua% pro-%e!
6nother window of results disla3s the dual ro)lem.
Steppin
If 3ou loo: at the first s$reen at the to of this se$tionB 3ou will noti$e that to the
left of the SO2.+ tool a ST+P tool aears.
0hile the iterations are availa)le in the iteration outut s$reenB it also is ossi)le
to ste through and see the iterations one at a time. The ma@or advantage of
steing is that &o' $an sele$t the entering varia)le. 0e have ressed ST+P and
the s$reen aears as follows. 7The disla3 varies a$$ording to the te=t set in "e%p,
6ser Infor!ation.8
The software has $reated a simle= ta)leau adding two sla$: varia)les. The first
$olumn is highlighted sin$e it has the highest rofit $ontri)ution. If 3ou want this
$olumnB ress the ST+P tool. If 3ou want to $hange the ivot $olumnB siml3 $li$:
on a different $olumn and then ress ST+P. 16fter one iteration the s$reen aears
as )elow.
0hen the otimal solution is foundB a message to that effe$t will aear in the
instru$tion )ar as shown )elow. Sin$e the software allows 3ou to iterate e)en after
finding the o!timal sol'tionB when 3ou are done 3ou must ress the ,I(ISH tool.
Aocation
There are four fa$ilit3 lo$ation models. The first module is the standard
qualitative;su)@e$tive weighting s3stem. Several fa$tors are identified that are
$onsidered to )e imortant for the lo$ation de$ision. 0eights are assigned to these
fa$torsB and s$ores for these fa$tors are determined for the various ossi)le sites.
The rogram $omutes the weighted sum of the s$ores 7and identifies the site with
the highest s$ore8.
The se$ond and third methods are quantitative methods for lo$ation on a line 7one
dimensional8 or a lane 7two dimensional8. In the one4dimensional $aseB the
$oordinate or street num)er must )e givenF in the two4dimensional $aseB )oth a
hori?ontal $oordinate and a verti$al $oordinate must )e given. In either $aseB the
rogram will have a default weight of 1 tri er lo$ationB )ut this ma3 )e $hanged
to refle$t different num)ers of tris or different weights of materials. The rogram
will find the median lo$ation and the mean lo$ation and total weighted and
unweighted distan$es from ea$h lo$ation.
NO,4C Some of the lo$ation models $alled one4 and two4 dimensional lo$ation
are also :nown as M$enter of gravit3L models in some te=t)oo:s
The last model is siml3 )rea:even anal3sis alied to lo$ation ro)lems.
,he Qua%itative BWeihtinC Mode%
If the qualitative model is $hosenB the general framewor: is given )3 the num)er
of fa$tors and the num)er of otential sites. In the s$reen followingB we show an
e=amle with seven fa$tors and three otential sites.
7actor weights. 0eights should )e given for ea$h fa$tor. The weights $an )e given
as whole num)ers or fra$tions. Generall3B weights sum to one or one hundredB )ut
this is not a requirement.
Scores. The s$ore of ea$h $it3 on ea$h fa$tor should )e given.
49a!p%e /: Weihted %ocation B:ua%itativeC ana%5sis
In the following s$reenB we disla3 a filled4in samleB along with the solution.
(oti$e that the $ities and the fa$tors have )een named.
The outut is ver3 straightforward and $onsists of the followingC
Total weighted score. ,or ea$h $it3B the weights are multilied )3 the s$ores for
ea$h fa$tor and summed. The total is rinted at the )ottom of ea$h $olumn. ,or
e=amleB the s$ore for Philadelhia has )een $omuted asC
1/Q-/ V 3/Q1/ V !Q"/ V 1!Q-/ V &/Q!/ V 1/Q4/ V !Q3/ W "!//
whi$h is listed at the )ottom of the Philadelhia $olumn.
The weighted average 7total s$ore;total weight8 is also disla3ed for ea$h lo$ation.
One-Di!ensiona% Sitin
If one4dimensional siting is $hosenB the general framewor: $onsists of a $olumn of
weights or tris and a single $oordinate or address $olumn. The required
information in order to get started is the num)er of sites to )e in$luded in the
anal3sis.
The solution s$reenB whi$h in$ludes the data for a four4site anal3sisB is given in the
following s$reen.
The information to )e filled in isC
Weight<tri!s. The weight or num)er of tris to and;or from ea$h site. The default
value is 1 for ea$h lo$ation. This is what should )e used when all
$ustomers;lo$ations are $onsidered to )e equal. If more tris are made to one
$ustomer than anotherB this $an )e in$luded in the weight;tri $olumn. If the
num)er of tris is the same )ut the weight of the materials differsB this should )e
in$luded.
4 coordinate. The $oordinate of the lo$ations must )e given. This $an )e e=ressed
in several different wa3s. These ma3 )e street addresses 7on the same street sin$e
this is one dimensional8B the3 ma3 )e floors in a )uilding 7it is ossi)le for the
dimension to go u instead of a$ross8B or the3 ma3 )e east4west or north4south
$oordinates where a negative num)er means west and a ositive num)er means
east or a negative num)er means south and a ositive num)er means north.
Our samle ro)lem with a solution aears a)ove. The outut again is ver3
straightforward.
Total weight or n'mber of tri!s. In order to find the mean or median lo$ationB it is
ne$essar3 to determine the total num)er of tris or total weight. In the e=amleB
there are 13 total tris so the middle tri is the seventh.
The mean location. This is the lo$ation that minimi?es the sum of the squares of
the distan$es of the tris.
The median tri!. The median tri is identified as tri num)er % and o$$urs from
the lo$ation at &1//.
In generalB an interesting question is whether a manager should minimi?e total
distan$e or total distan$e squared. (oti$e in this e=amle that one 3ields an answer
at )lo$: &1// and the other 3ields an answer at )lo$: 31//43&//.
,wo-Di!ensiona% Sitin
The information for two4dimensional siting is analogous to the information
required for one4dimensional siting. 6gainB the onl3 set4u information is the
num)er of lo$ations. The following s$reen $ontains the data and solution for a
two4dimensional siting ro)lem. The onl3 differen$e )etween the data for one4
and two4dimensional siting is the e=tra $olumn that now aears for the se$ond
$oordinate data. *ata is to )e entered in the same wa3 as for one dimensional
siting.
49a!p%e (: ,wo-di!ensiona% %ocation
The solution s$reen for two4dimensional siting has a large amount of information
as e=hi)ited in the re$eding s$reen. Some of the information is the same as that of
one4 dimensional siting and some is e=tra.
Weighted 4-coordinate. This is siml3 the $oordinate multilied )3 the num)er of
tris. In the e=amleB the num)er of tris is ositive for ea$h of the first five
lo$ations )ut / for the last two. The multili$ations )3 the weights $an )e seen.
Weighted &-(oordinate. This is identi$al to the revious $olumn e=$et that it is
the & $oordinate that is multilied. These weighted $olumns demonstrate the
$omutations that lead to the answers )elow the data. The averages of these
$olumns are the answers. (oti$e in this e=amle that dividing )3 % 3ields the first
7unweighted8 average and dividing )3 the sum of the weightsB whi$h is 3&/B 3ields
the se$ond 7weighted8 average.
Median. The median tri is 1"/ 7there is no 1"/.!8 and the median 4 $oordinate is
13& while the median & $oordinate is %!.
/)erages. The unweighted and weighted averages of the $oordinates are disla3ed.
,a-%e of Distances
Ta)les of distan$es from oint to oint $an )e disla3ed.
Total Distance. The row named MTotalL $ontains the total distan$e from ever3 site
to this site. The means for $omuting the distan$e deends on the ta)le 7air
distan$e vs. $it3 )lo$: distan$e8. The num)er --%.""! for raw material 1 means
that the site of raw material 1 at $oordinates 13&B 1&3 has a total distan$e of
--%."% from ea$h of the other si= sites. That isB if 3ou made one tri from ea$h of
the si= sites to the site of raw material 1B it would $over a distan$e of --%."%.
6nother wa3 to view this $olumn is to sa3 that otential site 1 is more $entral than
otential site & )e$ause it has a distan$e of -&1.%1B whi$h is smaller than the
1/11.-- of otential site &.
Weighted total. The num)ers in the distan$e row do not ta:e into a$$ount that
different num)ers of tris are made )etween oints or that different amounts of
material are moved )etween oints. This $olumn multilies the distan$e times the
num)er of tris or amount of materials moved. 6gainB thoughB otential site 1
seems to have the advantage over otential site &.
NO,4: It is ossi)leB and ma3)e even usefulB to solve the one4dimensional
ro)lem )3 using the two4dimensional model with one $oordinate equal to / for all
sites.
Drea7-even 0na%5sis
One more model is availa)le. This is siml3 a )rea:even anal3sis model sin$e
)rea:4even is alied to lo$ation ro)lem. 6n e=amle aears )elow. The
$rossover oints will )e found and a grah is availa)le.
Aot Si8in
This model will erform lot si?ing for determining total holdingB setuB and
sto$:out $osts when demands are not equal in ea$h eriod. Standard methods
in$lude the e$onomi$ order quantit3 7+O58B eriod order quantit3 7PO58B lot4for4
lotB art4eriod )alan$ing methodB and 0agner40hitin whi$h finds the otimal
s$hedule. 2ot si?ing is almost invaria)l3 dis$ussed in asso$iation with #RP
s3stems.
,he data
'onsider the following e=amleC
0ee: *emand
>ul3 11
>ul3 11
>ul3 &!
6ugust 1
6ugust 1
6ugust 1!
!
&
4
1
-
3
Holding $osts U& er unit er wee: and the $ost to set u a rodu$tion run is U&1.
There is no initial inventor3B nor is there a lead time.
6 data s$reen for our ro)lem aears ne=t. The data to )e given in$ludes
demands on the left and $osts and other information on the right of the ta)le.
Si= methods are availa)le in the method )o= a)ove the data.
1. 0agner40hitin finds the rodu$tion s$hedule whi$h minimi?es the total
$osts 7holding V setu8.
&. 2ot4for4lot is the traditional #RP wa3 of ordering e=a$tl3 what is needed
in ever3 eriod. 7This is otimal if setu $osts are /.8
3. The +O5 method $omutes the +O5 )ased on the average demand over
the eriod and orders in lots of this si?e. +nough lots are ordered to $over
the demand.
4. The eriod order quantit3 7PO58 translates the +O5 into time units
7num)er of eriods8 rather than an order quantit3. The PO5 is the length of
time an +O5 order will $overB rounded off to an integer. ,or e=amleB if
the demand rate averages 1// units er eriod and the +O5 is &/ units er
orderB the PO5 is 1//;&/ W ! eriods.
!. Part4eriod )alan$ing. This is a well4:nownB widel34used heuristi$ that is
$overed in man3 )oo:s.
". Aser defined. The user ma3 define the rodu$tion quantities.
Demands. The demands in ea$h eriod are to )e given. The demands are integers.
Prod'ce. This $olumn is used onl3 for the user4defined otion. +nter the num)er
of units to )e rodu$ed. If an otion other than user4defined is $hosenB the rogram
will revise this $olumn and disla3 it as outut.
The information on the right in$ludesC
$olding cost. The $ost of holding one unit for one eriod is to )e entered here.
The holding $ost is $harged against the inventor3 at the end of the eriod.
Shortage cost. The $ost of )eing short one unit for one eriod is to )e entered here.
The shortage $ost is $harged against the inventor3 at the end of the eriod if the
inventor3 is negative. *ue to lead time or under the user4defined otion it is
ossi)le for the inventor3 to )e negative. 7,or e=amleB the user $ould define
rodu$tion to )e / in ever3 eriod8.
NO,4C 0e generall3 assume that the holding and shortage $osts are $harged
against the inventor3 that is on hand at the end of the eriod.
Set'! cost. This is the $ost of ea$h rodu$tion run. It is $harged onl3 in the eriods
that have ositive rodu$tion.
*nitial in)entor&. It is ossi)le to allow for a situation where there is )eginning
inventor3.
=ead time. This will offset the requirements and rodu$e n eriods earlier. 7See
+=amle 38
49a!p%e /: 0 si9-period %ot si8in pro-%e!
The solution for our e=amle is disla3ed in the re$eding s$reen. The order
re$eit $olumn has )een derived )3 the rogram. The e=tra $olumns that are
derived $ontain the following informationC
*n)entor&. This is the amount of inventor3 on hand at the end of the eriod. In the
e=amleB there are si= units left after eriod 1B four units left after eriod &B and
three units on hand after eriod !. The holding $ost is $harged against these
amounts.
$olding cost. This is the $ost of holding inventor3 at the end of this eriod. It is
siml3 the num)er of units on hand multilied )3 the holding $ost er unitB whi$h
in this e=amle is U&.
Set'! cost. This is U/ if no rodu$tion o$$urs or the setu $ost if rodu$tion o$$urs
during this eriod. In the e=amleB setus o$$ur in eriods 1B 4B and !B so the setu
$ost of U&1 is listed in these three eriods )ut not in the other three eriods.
Totals. The total inventor3B holding $ostsB and setu $osts are listed at the )ottom
of ea$h $olumn. Thirteen units were held for one month at a $ost of U&".//. Three
setus o$$urred at a total $ost of U"3.
Total cost. The sum of the setu and holding $osts are disla3ed in the )ottom left
hand $orner. The total $ost in this e=amle is U1-. Sin$e we used 0agner40hitinB
this solution is otimal.
49a!p%e *: 6sin the 4OQ
One of the otions for la$ing orders is to use the e$onomi$ order quantit3. The
+O5 is $omuted )ased on the average demand over the eriods. In the e=amleB
the +O5 is )ased on the demand rate of 31 units er " eriods 731;" W !.1"%8.
Asing the holding $ost and setu $ost with this demand generates an +O5 of 1/
7after rounding8B as shown near the )ottom of the s$reen. The rogram will la$e
an order for 1/ units ever3 time that the inventor3 is insuffi$ient to $over the
demand. ,or e=amleB the first order for 1/ units is la$ed in eriod 1. This $overs
the demand in eriod 1 and the demand in eriod &. In eriod 3B we need another
order of 1/ units. Asing this method in the e=amle generates four orders 7whi$h
total 4/ unitsB not 31 units8 and a total $ost of U14&.
(ote that the +O5 method will li:el3 order more units than needed and therefore
have higher holding $osts than ne$essar3.
49a!p%e (: 6sin the POQ
0e have modified our revious two e=amles )3 adding an initial inventor3 of "
units and a lead time of 1 wee:. 0e also have $hanged the method to the PO5.
One of the otions for la$ing orders is to use the eriod order quantit3. The PO5
is the +O5 )ut e=ressed in time rather than units. In our e=amleB the PO5 is the
1/ units divided )3 the average demand rate and rounded offB whi$h is two
eriodsB as seen in the following s$reen. The rogram will la$e an order to $over
ever3 two eriods.
9e$ause there is a lead timeB the results s$reen in$ludes an e=tra $olumn for the
order release. ,or e=amleB the order due on >ul3 11 must )e released on >ul3 11
due to this lead time. The order quantities are the same as without the lead timeB
)ut the orders are released earlier due to the lead time. (oti$e that if we had used a
one wee: lead time )ut not added the initial inventor3 to $over the first eriodB
then there would have )een an unavoida)le shortage in eriod 1.
49a!p%e 1: Aot-for-%ot orderin
2ot4for4lot ordering 7not shown8 is ver3 straightforward and a $ommon wa3 for
#RP s3stems to oerate. The e=a$t amount demanded is alwa3s ordered. This is
otimal if there is no setu $ost.
Mar7ov 0na%5sis
6 #ar:ov 'hain is des$ri)ed )3 a transition matri= that gives the ro)a)ilit3 of
going from state to state. ,or e=amleB $onsider the followingC
,rom;To State 1 State & State 3
State 1
State &
State 3
.%
./!
./!
.1
.1!
./!
.&
.1
.-
If we are in state 1B there is a %/ er$ent $han$e that we will )e in state 1 at the
ne=t stageB a 1/ er$ent $han$e that we move to state &B and a &/ er$ent $han$e
that we move to state 3. There are essentiall3 two t3es of questions that need to
)e answered for #ar:ov 'hains. One isC 0here will we )e after a small num)er of
stesX The other isC 0here will we )e after a large num)er of stesX Often times
this deends on the state in whi$h we start.
The data s$reen for this e=amle is shown ne=t. The first $olumn 7MinitialL8 is
indi$ating that we have an equal $han$e of starting in an3 of the three states. This
$olumn does not have to $ontain ro)a)ilities as we show in +=amle &. The e=tra
data a)ove the data ta)le 7num)er of transitions8 indi$ates that we want to loo: at
the results after 3 transitions.
Resu%ts
The results s$reen $ontains three different t3es of answers. The to 34)343 ta)le
$ontains the three4ste transition matri= 7whi$h is indeendent of the starting
state8. The ne=t row gives the ro)a)ilit3 that we end in state 1 or & or 3B whi$h is
a fun$tion of the initial state ro)a)ilities. The last row gives the long4run
ro)a)ilit3 7stead3 state ro)a)ilit38 or the er$entage of time we send in ea$h
state.
The following s$reen disla3s the multili$ations through three transitions 7as
requested in the e=tra data )o= a)ove the data8.
49a!p%e *: 0 co!p%ete ana%5sis
'onsider the #ar:ov 'hain that is disla3ed ne=t. The $hain $onsists of three
different t3es of states. State 1 is a)sor)ingB states 3 and 4 together form a $losedB
re$urrent $lassB while state & is transient. ,urthermoreB we are indi$ating that at the
)eginning of this ro)lem there are "/B 1/B1//B and "/ 7total W 3//8 items in states
1B &B 3B and 4 rese$tivel3. 6s reviousl3 statedB the initial $olumn does not have
to $ontain ro)a)ilities.
The first outut ta)le isB as )eforeB des$ri)ing long4run )ehavior. The to of the
ta)le $ontains the long4run ro)a)ilities. The ending num)er row indi$ates the
e=e$ted num)er 7in the statisti$al sense8 of how man3 of the original 3// items
will end u in ea$h state. In this e=amleB we :now that the "/ that started in state
1 will end in state 1 and the 1"/ that started in states 3 and 4 will end in those
states 7divided evenl38. Of the 1/ that started in state &B &1.!% er$ent 7&&.1!%8
will end u in state 1B while the others will )e slit evenl3 over states 3 and 4.
The )ottom row of stead3 state ro)a)ilities all need to )e interreted as
$onditional on the $losed re$urrent $lass that the states are in. ,or e=amleB first
note that the3 do not sum to 1. These $lasses are identified in a se$ond outut
s$reenB as shown )elowC
,inall3B there is one more outut s$reen. This s$reen $ontains the usual #ar:ov
matri$es that are generated when erforming a #ar:ov 'hain anal3sis. The to
matri= is a sorted version of the original #ar:ov 'hain. It is sorted so that all
states in the same re$urrent $lass are ad@a$ent 7see states 3 and 48 and so that the
transient states are last 7state &8.
The 9 matri= is the su)set of the original matri= $onsisting of onl3 the transient
states.
The , matri= is given )3 the equationC
,W 7I498
41
where I is the identit3 matri=.
,inall3B the ,6 matri= is the rodu$t of the , matri= and the matri= formed )3
$ells that reresent going from a transient state to an3 nontransient state.
Materia% Re:uire!ents P%annin
The material requirements lanning 7#RP8 model is used to determine rodu$tion
requirements for items whi$h are deendent.
,he Data
'onsider the following e=amleC
The num)ers on the left of ea$h item indi$ate the num)er of su)$omonents that
must )e used in the arent $omonent. 2ead times are 1 wee:B e=$et for item bB
whi$h has a &4wee: lead time.
The framewor: for #RP is given )3 the num)er of lines in the indented )ill of
materials and the num)er of time eriods. In our s$reenB whi$h followsB
reresenting the e=amle a)oveB we show a ro)lem with % 9O# lines and 1
eriodsB as seen at the to of the s$reen. 17This is a good module to use the *o not
*isl3 Sero otion from the tool)ar or For!at menu8.
*tem names. The item names are entered in this $olumn. The same name will
aear in more than one row if the item is used )3 two arent itemsB su$h as item
e. (ote that as a ruleB names are unimortantB )ut in #RP names are e=tremel3
imortant. 'ase 7uer;lower8 does not matterB )ut sa$es matter ver3 mu$h.
*tem le)el. The level in the indented 9O# must )e given here. The item $an not )e
la$ed at a level more than one )elow the item immediatel3 a)ove. *o not use low
level $odes. 6lsoB lease note that it is ermissi)le to have more than one item at
level / 7more than one end item8 as shown in +=amle &.
=ead time. The lead time in order to get the item is entered here. The default is 1.
8'mber7`8 er arent. The num)er of units of this su)assem)l3 needed for its
arent is entered here. The default is 1.
On-hand. The $urrent inventor3 on4hand at the )eginning of the ro)lem is listed
here. If a su)assem)l3 is listed twi$eB it ma:es sense for the $urrent inventor3 to
aear onl3 one time. HoweverB if it aears twi$eB the starting inventor3 will )e
the sum of the listed amounts 7see +=amle &8.
=ot si5e. The lot si?e $an )e se$ified here. 6 / or a 1 will erform lot4for4lot
ordering. If another num)er is la$ed hereB all orders for that item will )e in lots
that are integer multiles of that num)er 7see +=amle &8.
Minim'm Q'antit&. It is ossi)le to se$if3 minimum order si?es 7see +=amle &8.
Demands 7entered under eriod 1 through eriod 18. The demands are entered for
an& level / itemB in the wee: in whi$h the items are demanded.
Sched'led recei!ts. If units are s$heduled to )e delivered in the futureB the3 should
)e listed in the aroriate time eriod 7$olumn8 and item 7row8 7see +=amle &8.
49a!p%e /: 0 si!p%e MRP e9a!p%e
6 samle data s$reen that e=resses the ro)lem aears in the re$eding
illustration. The levels indi$ate that we have an item termed a, whi$h has two
7level 18 su)$omonents named b and c. Su)$omonent b has two 7level &8
su)$omonents named e and f. Su)$omonent c has two su)$omonents named d
and e. (oti$e that e is a su)$omonent of )oth b and c.
The demand for the end itemB aB is 1&/ units in wee: % and 14/ units in wee: 1.
The num)er of su)$omonents used is given in the num)er4er4arent $olumn. ,or
e=amleB end item a $onsists of two su)$omonents 4 b, whi$h in turn $onsists of
1 e and & fs. 6t the )eginning of the ro)lemB there are no units of an3 :ind of
inventor3 on4hand.
MRP Product ,ree ?iewer
#RP has a rodu$t tree viewerB as shown )elow. 6n indented )ill of materials is
disla3edC
Resu%ts
6 ortion of the results is disla3ed in the following s$reen.
Total re9'ired. The total num)er of units required in ea$h wee: is listed in the first
row. ,or the end itemB this is the demand s$hedule that was inut on the data
s$reen. ,or other itemsB this is $omuted.
On-hand. The num)er on4hand is listed here. This starts as given on the data
s$reen and is redu$ed a$$ording to needs. 6 later e=amle will demonstrate on4
hand inventor3.
Sched'led recei!t. This is the amount that was s$heduled in the original data
s$reen 7see +=amle &8.
8et re9'ired. The net amount required is the amount needed after the on4hand
inventor3 is used. 6gainB $omonent c illustrates the su)tra$tion 7see +=amle &8.
Planned recei!t. This is the amount that will )e re$eived. It will )e the same as the
net required man3 timesB )ut it also ma3 )e larger due to minimum order si?e and
lot si?e requirements 7see +=amle &8.
Order release. This is the net required )ut offset )3 the lead time.
Printin
0e show a ortion of the rintout for the ro)lem for one main reason. The
rintout of the inut is in slightl3 different form than the s$reen disla3. (oti$e
that the software rints an indented )ill of materials.
+r!est Stu"e!t Stat .0%/MS&M .0$ Ho0ar" 1eiss
M,2+xamles2examle1.basi3.mat 1%-15-%004 13,3%,%0
Mo"ule/submo"el, Material Re4uireme!ts 'la!!i!5
'roblem title, +xamle 1
)!"e!te" 6&M a!" Results ----------
)!"e!te" 6ill o7 Materials
)tem 8umber er &! ha!" 9ot Size
Mi!imum
)D 9ea"time are!t )!:e!tory (i7 ; 1#
4ua!tity
a 1 1
b % %
e 1 1
7 1 %
3 1 3
" 1 5
e 1 4
Dema!"s 7or le:el 0 items
)tem )" = a
'erio" Dema!"
1 0
% 0
3 0
4 0
5 0
$ 0
< 1%0
. 140
S3he"ule" re3eits 7or all items 0hi3h are !ot e!" (le:el 0# items (i7 a!y#
a(lo0 le:el = 0#
<= " 0 "1 "% "3 "4 "5 "$ "< ".
--------------------------------------------------------------------------------------------------
(&(.R+=. 1%0 140
S3h"R+>.
&8 H?8D
8+( R+= 1%0 140
'la!R+>. 1%0 140
&RD R+9. 1%0 140
b(lo0 le:el = 1#
<= " 0 "1 "% "3 "4 "5 "$ "< '".
--------------------------------------------------------------------------------------------------
(&(.R+=. %40 %.0
S3h"R+>.
&8 H?8D
8+( R+= %40 %.0
'la!R+>. %40 %.0
&RD R+9. %40 %.0
Options
The ne=t e=amle will demonstrate some of the features of our #RP module. 0e
modif3 our revious e=amle as shown ne=t.
,irstB noti$e that we have $hanged the level for rodu$t d and the su)$omonent e
)elow it. Item d is an end item with a demand of "! in eriod 1. Thus e is at level
& for a )ut level 1 for d. Se$ondB we have given e an initial inventor3 of )oth 1/
and &/. 70e reall3 should not have )oth )ut we want to demonstrate what
haens.8 ThirdB we have a s$heduled re$eit of 1// units in eriod & for item c.
,ourthB item f must )e )ought or made in lots that are multiles of 144 units. ,ifthB
item b must )e ur$hased in quantities of 3// or more.
The results $an )e seen in the following rintout disla3. 70e have edited some of
the inut data )3 eliminating some /as.8
9isa 6. +r!est
',2Ma!ual2+xamles2+xamle%.mat 0%-%0-1@@@ 1%,00,5%
Mo"ule/submo"el, Material Re4uireme!ts 'la!!i!5
'roblem title, +xamle %
)!"e!te" 6&M a!" Results ----------
)!"e!te" 6ill o7 Materials
)tem 8umber er &! ha!"
9ot Size Mi!imum
)D 9ea" time are!t )!:e!tory
(i7 !ot lot 4ua!tity

7or lot#
a 1 1
b % %
300
e 1 1 10
7 1 %
144
3 1 3
" 1 5
e 1 4 %0
Dema!"s 7or le:el 0 items
)tem )" = a
'erio" Dema!"
< 1%0
. 140
)tem )" = "
'erio" Dema!"
. $5
S3he"ule" re3eits 7or all items 0hi3h are !ot e!" (le:el 0# items (i7
a!y#
)tem )" = 3
'erio" Re3eit
% .00
a(lo0 le:el = 0#
<= " 0 "1 "% "3 "4 "5 "$ "<
".
-------------------------------------------------------------------------
---------
(&(.R+=. 1%0
140
&8 H?8D
S3h"R+>.
8+( R+= 1%0
140
'la!R+>. 1%0
140
&RD R+9. 1%0 140
"(lo0 le:el = 0#
<= " 0 "1 "% "3 "4 "5 "$ "<
".
-------------------------------------------------------------------------
---------
(&(.R+=.
$5
&8 H?8D
S3h"R+>.
8+( R+=
$5
'la!R+>.
$5
&RD R+9. $5
b(lo0 le:el = 1#
<= " 0 "1 "% "3 "4 "5 "$ "<
".
-------------------------------------------------------------------------
---------
(&(.R+=. %40 %.0
&8 H?8D $0
.0
S3h"R+>.
8+( R+= %40 %%0
'la!R+>. 300 300
&RD R+9. 300 300
3(lo0 le:el = 1#
<= " 0 "1 "% "3 "4 "5 "$ "<
".
-------------------------------------------------------------------------------
---
(&(.R+=. 3$0 4%0
&8 H?8D .00 .00 .00 .00 440 %0
S3h"R+>. .00
8+( R+=
'la!R+>.
&RD R+9.
e(lo0 le:el = %#
<= " 0 "1 "% "3 "4 "5 "$ "<
".
-------------------------------------------------------------------------------
---
(&(.R+=. 300 300 %$0
&8 H?8D 30 30 30 30 30
S3h"R+>.
8+( R+= %<0 300 %$0
'la!R+>. %<0 300 %$0
&RD R+9. %<0 300 %$0
7(lo0 le:el = %#
<= " 0 "1 "% "3 "4 "5 "$ "<
".
-------------------------------------------------------------------------------
---
(&(.R+=. $00 $00
&8 H?8D 1%0 @$ @$ @$
S3h"R+>.
8+( R+= $00 4.0
'la!R+>. <%0 5<$
&RD R+9. <%0 5<$
(oti$e the on4hand inventor3 for item e. It )egins at 3/ and remains until it is
needed. (oti$e that for item c, a s$heduled deliver3 arrives in eriod & and then
goes into inventor3 until it is needed. (oti$e that for item f in eriod 4B "// units
are neededB )ut the order is la$ed for %&/ units )e$ause it must )e a multile of
144. (oti$e that for bin eriod "B the amount required is &4/B )ut 3// units are
ordered sin$e this is the minimum order si?e.
PO#45# for 0indows
Networ7s
Three models are availa)le in this moduleC minimum sanning treeB shortest athB
and ma=imal flow. 0e will use the following diagram for ea$h of our three
e=amles. In order to start an3 of the three su)modelsB it is ne$essar3 to indi$ate
the num)er of )ran$hes. In our e=amleB there are 14 )ran$hes. In order to enter
ea$h )ran$hB its starting node and its ending node must )e given.
Mini!u! Spannin ,ree
In the minimum sanning treeB we tr3 to $onne$t n nodes to ea$h other using Y1 of
the availa)le ar$s. 6r$s have $ostsB and the goal is to minimi?e the total $ost. The
data and solution to our e=amle aear in the following s$reenC
The data is the standard data of the ar$ or )ran$hB e=ressed as from and to node
num)ers and the $ost of using the ar$. 6)ove the data is a )o= that ena)les the user
to se$if3 the starting node num)er. If 3ou leave it as /B the lowest node num)er
1"&
'hater "C #odules
will )e used. Of $ourseB the total $ost is indeendent of the starting nodeB )ut the
a$tual ar$s used might var3 in minimum sanning tree ro)lems.
The eight )ran$hes that should )e used are mar:ed with a : and the minimum $ost
of $onne$ting the nine nodes is 1%1. 6 ta)le disla3ing the order in whi$h the
)ran$hes were added $an )e disla3ed as illustrated in the following s$reenC
Shortest Path
6 shortest ath e=amle is given )elowC
0e want to find the shortest ath and distan$e from one oint to another. The data
s$reen is shown in the re$eding illustration. (oti$e that it is ossi)le to se$if3
the origin and destination. If 3ou leave it at /B the rogram will find the shortest
ath from the minimum node num)er to the ma=imum node num)er 71 to -8 in this
e=amle.
1"3
PO#45# for 0indows
6)ove the dataB the networ: $an )e set to )e dire$ted or undire$ted. If it is
undire$tedB the distan$e from node 2 to node i is set equal to the distan$e from
node i to node 2. ,or e=amleB the distan$e from node & to node 1 is set to &/.
The solution is as followsC
,our )ran$hes should )e in$luded in the shortest athB $reating the ath 1434"414-B
with a total distan$e of 113. In additionB the rogram $omutes the minimum total
distan$e from ever3 node to ever3 other node as follows. To see the athB set the
values for the start and end a)ove the data.
Ma9i!a% F%ow
In this situationB we want to ma=imi?e the flow from the )eginning 7sour$e8 to the
end 7sin:8. The num)er along ea$h ar$ reresents its $aa$ities and the se$ond
num)er reresents its reverse $aa$it3 7$aa$it3 in the oosite dire$tion8. 6t the
toB the sour$e and sin: $an )e set. If the3 are left at /B the sour$e is the node with
the lowest num)erB and the sin: is the node with the highest num)er. 9efore
resenting our solution we remind 3ou that oftentimes more than one solution
e=ists. 6lsoB there ma3 )e more than one wa3 to derive the solution. The ma=imal
flow is "1B and the flows along the )ran$hes $an )e seen in the figure.
1"4
'hater "C #odules
The iterations are given in the following s$reen. Please note that there are generall3
several different iteration stes that $ould )e ta:en to arrive at the same ma=imal
flow.
1"!
Productivit5
Produ$tivit3 is defined as the ratio of outut to inut. This software ena)les 3ou to
$omute the rodu$tivit3 for an3 num)er of inuts and for an3 num)er of time
eriods. The software will $omute )oth the rodu$tivit3 measures for ea$h inut
and also the $hanges in rodu$tivit3 from eriod to eriod for ea$h inut. In
additionB the software allows for $reating a $ommon denominator so that 3ou will
end u with one rodu$tivit3 measure )ased on multile inuts. 6 samle s$reen
that in$ludes )oth the data and solution aears ne=t. The initiali?ation for this
ro)lem requested three inuts 7la)or hoursB materials and inse$tion hours8 and
two time eriods.
Data
@<+nit. This $olumn is used to aggregate all of the inuts into one meaningful
measure. ThusB we will $onvert our )asi$ inuts using rates of U1;hour for la)orB
U&;l) for materialB and U1&;hour for inse$tion $osts. ,or e=amleB in eriod 1 the
aggregate measure is 1Q4B///V&Q!B///V1&Q1B/// W !4B///.
Period A, B. The outut is entered in the first rowB and the inuts are entered in the
remaining rows for ea$h eriod.
So%ution
Prod'cti)it&. ,or ea$h inutB the ratio of outut to inut is disla3ed as the
rodu$tivit3 for ea$h eriod. In additionB an aggregate measure is $reated using the
$onversion fa$tors in $olumn 1. ThusB as mentioned a)oveB the denominator for
eriod 1 isC
1Q4/// V &Q!/// V 1&Q1/// W !4B/// whi$h 3ields a rodu$tivit3 of 1/B///;!4B/// or .
11!&.
(hange. 6 $olumn has )een added that relates the $hange from eriod to eriod for
ea$h of the rodu$tivit3 measures. ,or e=amleB the aggregate rodu$tivit3 has
de$reased )3 %.1- er$ent from eriod 1 to eriod &.
ProKect Schedu%in
The ro@e$t s$heduling models are used to find the 7e=e$ted8 ro@e$t $omletion
time for either a P+RT 7a$tivit3 on ar$B 6O68 networ: or a 'P# 7a$tivit3 on nodeB
6O(8 networ:. ,or )oth networ:sB either one4 or three4time estimate ro)lems $an
)e reresented or ro)lems with means and standard deviations for ea$h a$tivit3
ma3 )e entered.
There are five models that are $ommon. These models $an )e $hanged without
starting anew )3 using the method )o=.
Sin%e ,i!e 4sti!ate and ,rip%e ,i!e 4sti!ate P4R,
'onsider a small ro@e$t given )3 the following re$eden$e diagram and the ta)le
of times that follows the grah.
Tas: Start (ode +nd (ode Otimisti$ #ost 2i:el3 Pessimisti$
6
9
'
*
+
1
&
3
3
4
&
3
4
"
"
&
4
1/
3
4
1&
!
&3
!
%
&!
"
&1
%
-
Data
The following s$reen $ontains a trile4time estimate P+RT data s$reen for our
e=amle. In P+RT reresentationsB the networ: is defined )3 giving the starting
node and ending node for ea$h tas:. The networ: t3e is given )3 the )o= on the
left a)ove the data. In this first e=amleB we are using the start node;end node
reresentation for a$tivities.
The data $onsists ofC
/cti)it& name. 6$tivities $an )e named. In P+RTB the name is not usedB while in
'P# 7re$eden$e list8B the names are $riti$al. In P+RTB the MrealL name of an
a$tivit3 is given )3 its starting and ending node la)els.
Starting node. The num)er of the node at whi$h the a$tivit3 starts is to )e given
here. 0e remind 3ou that the num)ers in a P+RT diagram serve as la)els rather
than numeri$al values. The la)eling is ar)itrar3. That isB the first node $an )e 1 or &
or -/.
0nding node. The num)er of the node at whi$h the a$tivit3 ends is to )e given here.
The num)er $annot )e the same as the starting node num)er. 6lsoB two a$tivities
$annot have the same air of starting and ending node num)ers. 6lsoB transitivit3
must )e o)e3ed. That isB an error will o$$ur if laws of transitivit3 are violatedB su$h
as )3 the airs 71B &F &B 3F 3B 18.
Time estimate. In the single4time ro)lemB it is ne$essar3 to give onl3 one time
estimate for ea$h tas:.
O!timistic time. This aears onl3 in the three4time estimate otion from the
su)menu.
Most li-el& time. This time must )e entered in either the one4 or three4time estimate
version.
Pessimistic time. This aears onl3 in the three4time estimate version.
,he So%ution
The e=a$t solution s$reen deends on whether it is a one estimate or three estimate
ro)lem. In the following s$reenB we resent a samle three4estimate ro)lem
)e$ause this $ontains all of the outut information. The one4time estimate ro)lem
has less information.
Time. If the three4 time estimate version is usedB a single time estimate is $omuted
and rinted for ea$h a$tivit3. The formula used is the traditional formula of
t W 7a V 4b V c8;"B
where a is the otimisti$ timeB b is the most li:el3 timeB and c is the essimisti$
time. ,or e=amleB in the s$reen the time used for a$tivit3 14& is
7& V 4Q1& V &!8;" W %!;" W 1&.!.
0arl& start (0S). ,or ea$h a$tivit3B its earl3 start is $omuted. ,or e=amleB the
earl3 start for a$tivit3 34" is 1%.!. The $olumn named MtimeL is used for this
$omutation.
0arl& finish (07). ,or ea$h a$tivit3B its earl3 finish is $omuted. In the e=amleB the
earl3 finish for a$tivit3 34" is &&.!. The earl3 finish isB of $ourseB the earl3 start lus
the a$tivit3 time. ,or e=amleB the earl3 finish of 34" is its earl3 start of 1%.! lus
the ! from the time $olumn.
=ate start (=S). ,or ea$h a$tivit3B its late start is $omuted. In the e=amleB the late
start for a$tivit3 34" is 3".
=ate finish (=7). ,or ea$h a$tivit3B its late finish is $omuted.
Slac-. ,or ea$h a$tivit3B its sla$: 7late start 4 earl3 start or late finish 4 earl3 finish8
is $omuted. In the e=amleB the sla$: for a$tivit3 34" isC
414&&.! W 11.! or 3"41%.! W 11.!.
Standard de)iation. ,or the three4time estimate model the standard deviation of
ea$h a$tivit3 is listed. The standard deviation is given )3 essimisti$4otimisti$
divided )3 ". In the e=amleB the standard deviation of 34" is 7%438;"W."%.
Pro2ect com!letion time. The 7e=e$ted8 time at whi$h the ro@e$t should )e
$omleted is given. In the e=amleB this time is 41.
Pro2ect standard de)iation. If the three4time estimate module is $hosenB the ro@e$t
standard deviation is rinted. It is $omuted as the square root of the ro@e$t
varian$eB whi$h is $omuted as the sum of the varian$es of all $riti$al a$tivities.
(ote that in general there are ro)lems in defining the varian$e of ro@e$t
$omletion time. In additionB some )oo:s var3 in the manner of $omutation. This
rogram will overestimate the standard deviation if there is more than one $riti$al
ath. Hour te=t li:el3 does not e=lain what to do when more than one $riti$al ath
e=ists.
There is availa)le a ta)le that disla3s the $omutations of the tas:sE timesB
standard deviationsB and varian$esB as illustrated in the following s$reenC
It is ossi)le to disla3 Gantt 'harts for the ro@e$tB as shown ne=tC
.PM BPrecedence %istC
The $riti$al ath module has the data inut in a fashion nearl3 identi$al to the
assem)l3 line )alan$ing module. 'onsider the e=amle given in the following ta)leC
Tas: Time Pre$eden$es
design
rogram
do$ument
test
advertise
&!
3/
&&
1/
3/
design
design
rogram
design
The initial data s$reen aears as given )elowC
Tas- names. Tas:s $an )e given names. The usual naming $onventions are true.
That isB uer and lower$ase do not matter )ut sa$es within a name do.
Tas- times. The tas: times are entered here.
Predecessors. The rede$essors are listed here. +nter one rede$essor er
sreadsheet $ell with u to seven rede$essors er a$tivit3. It is suffi$ient to enter
onl3 the immediate rede$essors.
Rather than disla3ing the solution to this ro)lemB we show the re$eden$e grah
that the software $an disla3. 1On the s$reenB the $riti$al ath is disla3ed in red.
.rashin
,ollowing is an e=amle of ro@e$t management with $rashing. The four $olumns
of data are the standard $olumns for this t3e of ro)lem 4 the normal time and
normal $ost for ea$h a$tivit3 as well as the $rash time and $rash $ost for ea$h
a$tivit3. The $rash time must )e less than or equal to the normal timeB and the $rash
$ost must )e greater than or equal to the $rash $ost.
The results are as follows. The software finds the normal time of 1" da3s and the
minimum time of 1& da3s. ,or ea$h a$tivit3 the $omuter finds the $ost of $rashing
er eriod 7$rash $ost4normal $ost8;7normal time4$rash time8B whi$h a$tivities
should )e $rashed and )3 how mu$hB and the rorated $ost of $rashing.
6 da34)34da3 $rash s$hedule is availa)le.
Dudetin
The software has a model for determining the amount of mone3 that will )e sent
over a ro@e$tEs lifetime. The data is the a$tivit3 $ost as shown ne=t. 6n earl34start
)udget and a late4start )udget $an )e $omuted.
The regular solution s$reen is givenB )ut two others are also availa)le. In the ne=t
s$reenB we show a art of the earl34start )udget.
In additionB the grah $ontains the earl34start and late4start )udget for the entire
ro@e$t.
Nor!a% Distri-ution
Pro@e$t management is an area where the normal distri)ution $al$ulator is useful as
shown in the following s$reen. The mean and standard deviation from the ro@e$t
7+=amle 18 are automati$all3 filled in. 0e have several otions in terms of what
we ma3 want to $omute. ,or e=amleB we $an $omute the ro)a)ilit3 of finishing
within !/ da3sB or a -!Z $onfiden$e interval for finishing the ro@e$t.
6lternativel3B we $an $omute how man3 da3s to allow to )e -/ er$ent sure of
finishing within that time. 0e have $hosen a -!Z $onfiden$e interval.
6fter ressing the ;.o!pute< )uttonB the solution aears as shown )elowC
0e are -! er$ent $onfident that the ro@e$t will )e $omleted in 31 to !1 da3s.
Qua%it5 .ontro%
This module $an )e used for the three ma@or areas of statisti$al qualit3 $ontrol 4
a$$etan$e samlingB $ontrol $hartsB and ro$ess $aa)ilit3. ,or a$$etan$e
samlingB )oth attri)utes and varia)les lans $an )e develoed. 6ttri)utes lans are
used when the measurement is a defe$tive;nondefe$tive t3e of measurementB while
varia)les lans are used for ta:ing a numeri$al result rather than siml3 a 3es;no. In
additionB the model $an )e used to $omute the rodu$erEs and $onsumerEs ris:
under a given samling lan and;or to ma:e a $rude lot of the oerating
$hara$teristi$ 7O'8 $urve. ,or $ontrol $hartsB it is ossi)le to develo !4$harts for
the er$entage defe$tiveB =4)ar $harts for the meanB or c4$harts for the num)er of
defe$ts. The s$reens for the first three otions are similarB and the s$reens for the
$ontrol $harts are also similar.
0cceptance Sa!p%in
The e=a$t elements in the data s$reen deend on whether an attri)utes samling
lan or a varia)les samling lan is sele$ted. In either $aseB the t3es of data
s$reens are ver3 similar. 0e )egin with the des$rition of the attri)utes data s$reen
and resent the varia)les data s$reen later.
0ttri-utes Sa!p%in
6 samle s$reen that in$ludes )oth the data and solution aears ne=tC
Data
/Q=. ,or a$$etan$e samlingB the 6$$eta)le 5ualit3 2evel must )e given. The
652 must )e 7stri$tl38 greater than / and must )e less than 1. The interretation
of ./1 is an 652 of 1 er$ent defe$tive.
=TPD. The 2ot Toleran$e Per$ent *efe$tive must )e entered. This has
$hara$teristi$s similar to the 652. It must )e )etween / and 1.
/=P$/-The !rod'cerCs ris-. The ro)a)ilit3 of a t3e 1 error $an )e set using the
dro4down )o= to )e either 1 er$ent or ! er$ent in attri)utes samling. ,or
varia)les samlingB this entr3 is numeri$alB with a ma=imum allowa)le value of .--.
10T/ -The cons'merCs ris-. The ro)a)ilit3 of a t3e & error $an )e set to )e 1
er$entB ! er$entB or 1/ er$ent for attri)utes samling. This entr3 is numeri$alB
with a ma=imum value of .1 for varia)les samling.
So%ution
6 samle ro)lem and solution s$reen aears in the re$eding s$reen. In this
e=amleB we are tr3ing to determine the aroriate samling lan when the 652
is se$ified at 1 er$entB the 2TP* is se$ified at ! er$entB alha is ! er$entB and
)eta is 1/ er$ent.
The sam!le si5e. The minimum samle si?e that meets the requirements a)ove is
determined and disla3ed. In this e=amleB the aroriate si?e is 13%.
The critical )al'e. The ma=imum num)er of defe$tive units 7attri)utes samling8 or
the ma=imum varia)le average 7varia)les samling8 is disla3ed. In this e=amleB
the ma=imum allowa)le num)er of defe$ts in the 1& units is 3.
Two additional outut values aear on the rightB indi$ating that the a$tual ris:s
differ from the se$ified ris:s. The rogram is designed to find the minimum
samle si?e that meets the requirements. The requirements $an )e more than met
due to the integer nature of the samle si?e and $riti$al value.
NO,4: The $omutation of the a$tual ris:s is )ased on the )inomial distri)ution.
/ct'al !rod'cerCs ris-. The rodu$erEs ris: in the inut is the uer level for the
allowa)le rodu$erEs ris:. The a$tual rodu$erEs ris: $an )e less and is disla3ed.
In this e=amleB it haens to )e ./4-! whi$h is nearl3 the same as the ./! that was
set as inut.
/ct'al cons'merCs ris-. The $onsumerEs ris: in the inut is the uer level for the
allowa)le ris:. The a$tual $onsumerEs ris: $an )e less and is disla3ed. In this
e=amleB it haens to )e ./144B whi$h is less than the setting of .1 that was entered
as inut.
6n Oerating 'hara$teristi$ 7O'8 'urve $an )e disla3ed as illustrated ne=tC
6n 6verage Outgoing 5ualit3 76O58 'urve is also availa)le.
49a!p%e *: ?aria-%es sa!p%in
(e=t we resent the data and outut for a varia)les samling lan. 0e want to
a$$et the lot if the mean is &// ounds )ut re@e$t the lot if the mean is 11/ ounds.
The standard deviation of the items rodu$ed is 1/ ounds. 0e are using ! er$ent
and 1/ er$ent for alha and )etaB rese$tivel3. ,or varia)les samlingB alha and
)eta are numeri$al rather than reset )3 the dro4down )o=. The ne=t e=amle will
illustrate this more $learl3.
The outut is ver3 similar to the outut for attri)utes samling. In this e=amleB we
should samle 3 items and weigh them. If the average weight is less than 11-.1-"4
oundsB we should re@e$t the lot.
.ontro% .harts
The fourthB fifthB and si=th otions from the su)menu are used to develo $ontrol
$harts. Otion 4 is used when the er$entage of defe$ts is of interestB otion ! when
there is a varia)le measurement and an 44)ar or range 7,49ar8 $hart is required. The
last otion is for the num)er of defe$ts 7distri)uted as a Poisson random varia)le8.
In an3 of these $asesB it is ne$essar3 to indi$ate how man3 samles there are.
49a!p%e (: 0 p--ar chart
The module )egins )3 as:ing for the num)er of samles. In +=amle 3B whi$h is
shown in the following s$reenB we filled in a $olumn of data indi$ating the num)er
of defe$ts in ea$h of 1/ samles. 6lsoB we have as:ed for a 34sigma $ontrol $hart at
the to. The to indi$ates that the samle si?e for ea$h of these samles was 1!/.
,inall3B 3ou $an sele$t the $enter line )3 using the s$roll)ar;te=t)o= $om)ination or
leave it at / in whi$h $ase the software will use the mean.
The rogram has $omuted the average er$entage of defe$tsB whi$h is disla3ed as
3.1 er$ent. The standard deviation of !4)ar is shown at the uer right as ./1!".
6 $ontrol $hart $an also )e disla3ed and is e=hi)ited )elowC
49a!p%e 1 - an x--ar and rane chart
6fter the num)er of samles is enteredB there are two otions. +ither the raw data
$an )e entered or the mean and range for ea$h samle $an )e entered. 0e will
disla3 )oth. In the e=amleB we disla3 the data and outut for the mean 744)ar8
and range 7,4)ar8 $harts. Si= samles of five items have )een ta:en and their
weights have )een re$orded. The first samle had an average weight of !"1.-
ounds and a range of &!.3 ounds. The $ontrol $harts are set u )ased on the
range. 7Some authors set u $ontrol $harts )ased on standard deviations rather than
ranges.8 The mean and range $hart on the right are )ased on three standard
deviations. (oti$e that rather than setting the $enter line of the mean $hart
a$$ording to the overall mean we have set to a se$ifi$ation of !!! using the
s$roll)ar;te=t)o= a)ove the data.
49a!p%e +: 6sin raw data in x -ar and rane charts
The following s$reen resents the data for an e=amle with raw dataC
The software $omutes the mean and range for ea$h samle and then $omutes the
$ontrol $harts.
49a!p%e 3: c-charts
The following s$reen $ontains a samle c4$hart. The num)er of samles is entered
followed )3 the num)er of defe$ts in ea$h samle. The rogram $omutes and
disla3s the defe$t rate 74.48B its standard deviation 7&./-%"8B and the $ontrol limits.
Process .apa-i%it5
,or ro$ess $aa)ilit3B the uer and lower toleran$es for a ro$ess must )e set.
Otionall3B the mean ma3 )e set. If the mean is not set then the $enter oint
)etween the uer and lower toleran$es will )e used. ,inall3B a standard deviation
must )e given. 9oth an uer and lower inde= are $omutedB and ro$ess $aa)ilit3
is the minimum of these two indi$es.
Re%ia-i%it5
The relia)ilit3 module will $omute the relia)ilit3 of simle s3stems. If it is used
reeatedl3B $omle= s3stems $an )e develoed. This module $an easil3 )e used to
determine the aroriate num)er of )a$:u 7stand)38 ie$es of $omonents. The
module has five su)models. The general framewor: for the first three is identi$alB
and the framewor: for the last two is identi$al.
Data
The general framewor: for relia)ilit3 is given )3 the num)er of simle s3stems
that are in series and the ma=imum num)er of $omonents in an3 simle s3stem.
93 a simle s3stemB we mean that it is a set of arallel $omonents witho't an3
series. In the following e=amleB we are setting u for a s3stem with four simle
s3stems in series. The largest num)er of $omonents in an3 of these four simle
s3stems is si=. There is onl3 one t3e data that needs to )e entered.
(om!onent reliabilit&. The required information is the relia)ilit3 of ea$h
$omonent. It is used for $omuting the relia)ilit3 of the simle arallel series
reresented )3 the $olumn.
NO,4: This is a module where using the otion to not disla3 ?eros will ma:e
the data disla3 more reada)le.
So%ution
6 samle solution s$reen that also $ontains the data is given ne=t. (oti$e that the
row in whi$h the ro)a)ilit3 is entered does not matterB as e=emlified )3 the fa$t
that s3stems 1 and & ea$h have the same relia)ilit3 of -- er$ent.
Sim!le s&stem reliabilit&. 9elow ea$h arallel s3stem 7$olumn8B its relia)ilit3 is
resented. The relia)ilit3B rB of n $omonents in arallel is given )3C
r W 1 4 71 4 r
1
871 4 r
&
8...71 4 r
n
8
where r
@
is the relia)ilit3 of the 2
th
individual $omonent. In the e=amleB the first
arallel set has a relia)ilit3 of its one $omonentB whi$h is .--F the same is true for
the se$ond setF the third has an overall relia)ilit3 of .---1!"B as listed at the
)ottom of the third $olumnF and the fourth has a relia)ilit3 of .---1%&.
S&stem reliabilit&. The overall s3stem relia)ilit3 is given at the )ottom. The overall
relia)ilit3 is the rodu$t of the individual arallel series relia)ilities. The e=amle
has a s3stem relia)ilit3 of .-%-134.
49a!p%e *: Deter!inin the nu!-er of -ac7ups
It is ossi)le to $omute the num)er of )a$:us required in order to ensure
se$ified s3stem relia)ilit3 for a arallel s3stem. ,or e=amleB suose that the
relia)ilit3 of an individual $omonent is !/ er$ent and the desired s3stem
relia)ilit3 is -- er$ent. ThenB )3 $reating a ta)le with no )a$:usB 1 )a$:uB &
)a$:usB et$.B the aroriate num)er of )a$:us $an )e found. 7This is an
enumeration method8. ,or the relia)ilities se$ified as !/ er$ent and -- er$ent
we see from )elow that the aroriate num)er of $omonents is seven 7si=
)a$:us8.
Identica% Para%%e% or Identica% Seria% .o!ponents
6lternativel3B a different su)model $ould )e used. The fourth and fifth su)models
in the relia)ilit3 module ma3 )e used for $omuting the relia)ilit3 of arallel
s3stems with identi$al $omonents or s3stems in series with identi$al $omonents.
9elowB we show a s$reen for identi$al arallel $omonents. There are onl3 two
items to )e entered.
8'mber in !arallel. In the e=tra data anel a)ove the data ta)leB there is a
s$roll)ar;te=t)o= $om)ination into whi$h we la$e the num)er of $omonents. In
this e=amleB we are indi$ating that there are 1/ identi$al $omonents 7one
original and nine )a$:us8.
(om!onent reliabilit&. The data ta)le requires one ie$e of information. This is
the relia)ilit3 of the $omonents. In the e=amleB we have la$ed a .! indi$ating
that ea$h of the 1/ arallel $omonents has a relia)ilit3 of !/ er$ent.
So%ution
The solution indi$ates that the overall relia)ilit3 is .---/&3 whi$h agrees with the
more detailed disla3 in the revious s$reen in $olumn 1/.
Si!u%ation
The simulation model is used to generate values from dis$rete ro)a)ilit3
distri)utions or frequen$3 ta)les. A to ten $ategories $an )e simulatedB and u to
1/B/// num)ers $an )e generated in ea$h e=eriment. The num)er and er$entage
of o$$urren$es of ea$h $ategor3 are disla3edB and the generation of the num)ers
$an )e viewed on a ste4)34ste )asis.
In order to generate a simulation ro)lemB it is ne$essar3 to rovide the num)er of
$ategories for the data. In the following s$reenB we show a s$reen with )oth the
data and solution for a simulation of 1/ $ategories.
The elements of data areC
The n'mber of trials. This is the num)er of random num)ers to )e generated. A
to 1/B/// trials $an )e generated.
Seed. 0hen using simulationB a seed for the random num)er generator must )e
given. The default seed for the $omuter is /. If 3ou use the same seed or row or
$olumn two timesB the same set of random num)ers will )e generated. In other
wordsB to run different e=eriments 3ou must reset the random num)er generation
ro$ess )3 $hanging the seed.
NO,4: ,or Hei?er;RenderB Ta3lor or Render;Stair;Hanna users the following
random num)er generation method is availa)leC
,andom n'mber generation method. There are two )asi$ wa3s that the random
num)ers $an )e generated. It is ossi)le to have the software generate random
num)ers and then $onvert them to the desired frequen$iesB or it is ossi)le to use
the random num)ers from a ta)le in a )oo:.
3al'e. The values for the varia)les are given here. In the e=amleB the3 are 1
through 1/B )ut the3 $an )e an3 set of values. The3 are used for the $omutation
of the e=e$ted value.
(ategor& fre9'encies. The frequen$ies for ea$h $ategor3 are entered here. These
must )e nonnegative )ut do not need to )e integerB nor do the3 need to sum to
an3thing se$ial 7su$h as 1 or 1//8B sin$e the rogram will total this $olumn and
s$ale the results.
49a!p%e: Si!u%atin a fre:uenc5 ta-%e
In the re$eding s$reenB we disla3 a 1/4$ategor3 ro)lem and its solution. 6t the
toB it $an )e seen that we as:ed for !/ trialsB with the $omuter generating
random num)ers and the seed )eing 3. The solution in$ludes the followingC
Total. This is the total of the frequen$3 $olumnB and as mentioned )eforeB is used
for s$aling. In this $aseB we will divide the frequen$ies )3 3- in order to determine
the relative frequen$ies or ro)a)ilities.
Probabilit&. This $olumn reresents the s$aled frequen$3 for ea$h $ategor3 given
)3 the frequen$3 divided )3 the total frequen$3. ,or e=amleB $ategor3 & has a
relative frequen$3 of 1 divided )3 3-B or &/.!1 er$ent.
('m'lati)e. The $umulative ro)a)ilit3 is needed to $onvert the uniform random
num)er from the $omuter or )oo: to the aroriate relative frequen$3. The
$umulative ro)a)ilit3 is siml3 the running sum of ro)a)ilities. ,or e=amleB the
$umulative ro)a)ilit3 for $ategor3 3 is ./&!" V .&/!1 V ./%"- W .3/%%.
3al'e6fre9'enc&. This $olumn is used to $omute the weighted average or
e=e$ted value of the given frequen$3 distri)ution. In this e=amleB the $olumn
total is !.&/!1B whi$h is the weighted average of the two $olumns or the e=e$ted
value of the distri)ution.
Occ'rrences. This is the $ount of the num)er of times this $ategor3 was generated.
The individual o$$urren$es $an )e seen )3 disla3ing the histor3. In this
e=erimentB $ategor3 4 was generated three times.
Percentages This is the o$$urren$es divided )3 the total num)er of trials. ,or
e=amleB the three o$$urren$es of $ategor3 4 reresent " er$ent of the total of !/
trials.
Occ'rrences6)al'e. This $olumn is used to $omute the weighted average of the
simulated frequen$3 distri)ution. In this e=amleB the $olumn total is &11B whi$h
divided )3 the !/ runs 3ields a weighted average of !."&.
6 list of the !/ individual num)ers $an )e disla3ed.
The first uniform num)er generated was .3% and this falls )etween .3/%% and .
41/3B the $umulative for $ategor3 4B so $ategor3 4 is $hosen. The se$ond random
num)er generated was .!33% and this falls )etween .4"1! and .!1-%B so $ategor3 "
is designated.
Statistics
The statisti$s module is used to $omute the mean or e=e$ted value or weighted
average and standard deviation of a samle or oulation or a frequen$3 ta)le or a
ro)a)ilit3 distri)ution. In additionB (ormal distri)ution $al$ulators ma3 )e done
using this module. The (ormal distri)ution $al$ulator toolB disla3ed in the Pro@e$t
#anagement se$tion erforms the same $al$ulations as this model. It has a slightl3
)etter inut design 7)e$ause it is not restri$ted to )eing a ta)le8 )ut it $an not save
files as this module $an.
0hen $reating a data set 3ou will )e as:ed in the lower left $orner of the $reation
s$reen a)out the t3e of data set that 3ou want. 0e will show e=amles for ea$h
of the t3es.
49a!p%e /: .o!putin statistics on raw data
6 samle s$reen that in$ludes a list of 1/ items and the solution aears )elow.
3al'e. The first $olumn $ontains the numeri$al values 74
i
8
The ne=t two $olumns disla3 the $omutations that are used for the varian$e and
standard deviation. The last $olumn disla3s the data in sorted order.
The results in$lude the meanB medianB modeB oulation 7divide )3 n8 and samle
7divide )3 Y18 varian$es and standard deviationsB the minimumB ma=imum and
range. There also is a grah availa)le and a histogram whi$h $an )e $omuted for
the data.
49a!p%e *: Fre:uencies
In the e=amle )elowB we have entered groued data.
Mid!oint or )al'e. This is the value to )e used for $omutations.
7re9'enc& or !robabilit&. The frequen$ies for ea$h $ategor3 are entered here.
These must )e nonnegative )ut do not need to )e integerB nor do the3 need to sum
to an3thing se$ial 7su$h as 1 or 1//8B sin$e the rogram will total this $olumn and
s$ale the results.
Total. This is the total of the frequen$3 $olumn andB as mentioned )eforeB is used
for s$aling.
Percent. This $olumn reresents the s$aled frequen$3 for ea$h $ategor3B given )3
the frequen$3 divided )3 the total frequen$3.
3al'e6fre9'enc&. This $olumn is used to $omute the weighted average or
e=e$ted value of the given frequen$3 distri)ution. In this e=amleB the $olumn
total is 1&&B&1" whi$h we divide )3 the num)er of o)servations 71B!/18 to derive
the mean of 11./4!1.
4i-4bar. In order to $omute the standard deviation we need to $omute the values
4
i
minus 4 )ar.
4i-4bar[&. The revious value is squared.
(4-4barDB)6fi. The squared values are weighted )3 the ro)a)ilities and summed.
.o!putin statistics for a pro-a-i%it5 distri-ution
9oth the data and the results are on the results s$reen )elow.
3al'e. This is the value to )e used for $omutations.
Probabilit&. The ro)a)ilities for ea$h $ategor3 are entered here. These must )e
nonnegative and must sum to 1.
Total. This is the total of the ro)a)ilit3 $olumn and )etter )e 1.
('m'lati)e. The $umulative ro)a)ilit3 is resented. The $umulative ro)a)ilit3 is
siml3 the running sum of ro)a)ilities. ,or e=amleB the $umulative ro)a)ilit3
for value 3 is .4 V.&! V.1! W .1.
3al'e6!robabilit&. This $olumn is used to $omute the weighted average or
e=e$ted value of the given frequen$3 distri)ution. In this e=amleB the $olumn
total is &.3B whi$h is the weighted average of the two $olumns or the e=e$ted
value or mean of the distri)ution.
--m'. In order to $omute the standard deviation we need to $omute the values 4
i
minus 4 )ar.
--m'[&. The revious value is squared.
(--m'DB)6!(4). The squared values are weighted )3 the ro)a)ilities and summed.
The varian$e for this data is &.11
,he Nor!a% Distri-ution
Hou need to indi$ate on the $reation s$reen whether 3ou want to $omute $utoffs
given a ro)a)ilit3 or $omute ro)a)ilities given a $utoff or $utoffs
In our ro@e$t management e=amle we $omuted $utoffs given a -!Z ro)a)ilit3
so in this e=amle we will $omute the ro)a)ilit3 given $utoffs. The data and the
results aear in the results s$reen.
On$e againB a grah is availa)le.
,he ,ransportation Mode%
This module is used to solve transortation ro)lems. Of $ourseB this module $an
)e used to solve other ro)lems su$h as assignment ro)lems and rodu$tion
lanning ro)lems.
NO,4: The 6ggregate lanning module $ontains a transortation model otion.
Data
The transortation ro)lem is stru$tured a$$ording to the num)er of origins in the
ro)lem and the num)er of destinations.
Ob2ecti)e f'nction. 0hile minimi?ation is the usual o)@e$tive in transortationB
either minimi?e or ma=imi?e $an )e $hosen at the time that the data set is $reated
orB as usual at the edit s$reenB through the o)@e$tive )o= a)ove the data set.
'onsider the following e=amle. Our initial data s$reen for this !4)34" samle
ro)lem followsC
(oti$e that a ST+P )utton aears on the tool)ar.
Ob2ecti)e. The o)@e$tive fun$tion $an )e $hanged in the usual otion method.
Shi!!ing costs. The main )od3 of information is the shiing $ost from ea$h origin
to ea$h destination.
(OT+C If 3ou enter an J=E for a $ell then a large shiing $ost 7U----;unit8 will )e
la$ed in the $ell whi$h will effe$tivel3 eliminate the $ell from $onsideration in
the solution.
S'!!lies. The $olumn on the far right $ontains the sul3 at ea$h origin.
Demands. The demand row $ontains the demand at ea$h destination.
Starting method. ,our otions are availa)le in the method dro4down )o=. The3
areC
1. 6n3 method 7the software a$tuall3 uses .ogelEs aro=imation method8
&. (orthwest $orner method
3. .ogelEs aro=imation method
4. #inimum $ost method. 76lso :nown as the intuitive method8
The otimal $ost isB of $ourseB indeendent of the initial methodB as is the otimal
shiing s$hedule when there are no alternative solutions.
So%ution
6 solution to the samle ro)lem follows. The main solution s$reen shows the
shiments that are to )e made and $ontains the total $ost in the uer4left $orner. If
a dumm3 row or $olumn needs to )e addedB it will aear in this ta)le.
Total cost or !rofit. The total $ost or rofit aears in the uer4left $orner.
Marina% .osts
6 ta)le of marginal $osts is availa)le.
Steppin
0e $onsider the same ro)lem )ut $hange the solution method to (orthwest
$orner. The first ta)le aears as )elowC
(oti$e that some of the num)ers are en$losed in arentheses while others are not.
7On the s$reen the num)ers also disla3 in two different $olors.8 The num)ers
without a sign reresent the shimentsB while the num)ers with a sign reresent
the marginal $osts. The largest 7a)solute value8 marginal $ost is 4-1 in the $ell
>en:intown to *umm3 7whi$h is the $urrent $ell sele$ted )3 the software8. 6lso
noti$e that the total $ostB whi$h is U31B/1%B is disla3ed at the to of the ta)le. Hou
do not have to use the entering $ell suggested )3 the software. Hou $an use the
dire$tion :e3s to $hange the entering $ell.
Reeating this ro$ess five more times )rings us to the s$reen disla3ed ne=t. In
this s$reenB there is a message after the $ost indi$ating that the solution is otimal
and we need to ress ,I(ISH. +ver3thing after this is as )efore if we ress a :e3
one more time. That isB we $an disla3 the shimentsB the marginal $ostsB or )oth
in one ta)le.
6nother otimal solution is given )3 steing again.
Waitin Aines
There are man3 different waiting line situations that are des$ri)ed in PO# and
5# te=t)oo:s. 0e $onsider standard models 4 that isB single4hase queueing
models that do not allow feed)a$:B )at$h arrivalsB )at$h servi$eB )al:ing or
reneging. #odels of this t3e are des$ri)ed )3 a standard notation termed
GendallEs notationB although man3 te=t)oo:s avoid this ver3 $ommon notation.
Some queueing models allow for the determination of the average $ost of
oerating a queueing s3stem where the $ost is the sum of the la)or $osts and the
waiting $osts as $harged against either the s3stem time 7num)er in s3stem8 or the
waiting time 7num)er waiting8.
Data
The framewor: for waiting lines deends on the se$ifi$ model to )e used. 0e
$onsider nine modelsB and ea$h of these models $an )e used with or without $osts.
In generalB the e=a$t data required will var3 as the model $hanges. The models are
$hosen at the )eginning.
There are nine models availa)le. Some models are se$ial $ases of other models.
In arti$ularB all of the single4server models are se$ial $ases of the $orresonding
multile4server models. The models are listed )elow with their aliases. 6ll models
assume a Poisson arrival ro$ess.
M<M<A 4 e=onential servi$e timesB 1 server 7a.:.a. the single server model8
M<D<A 4 $onstant servi$e timesB 1 server 7a.:.a. the $onstant servi$e model8
M<%<A 4 general servi$e timesB 1 server
M<0
-
<A 4 +rlang4: servi$e timesB 1 server
M<M<s 4 e=onential servi$e timesB 1 or more servers 7a.:.a. the multile
server model8
M<M<A with a finite queue 7or finite s3stem8 si?e
M<M<s with a finite queue 7or finite s3stem8 si?e
M<M<A with a finite oulation.
M<M<s with a finite oulation
The first arameter in the notation refers to the arrival ro$ess. The M stands for
#emor3lessnessB whi$h means a Poisson arrival ro$ess. The se$ond arameter
refers to the servi$e ro$ess. The M again stands for memor3less whi$h means that
the servi$e times follow an e=onential distri)ution. The D stands for
deterministi$B whi$h is used when servi$e times are $onstant 7alwa3s the same8.
The % stands for generalB and the 0
-
stands for +rlang4: distri)ution. The third
arameter is the num)er of servers 7also $alled $hannels8. (ote that s $an )e set to
one in the M<M<s models to solve the M<M<A model.
Data
6 samle data s$reen aears ne=t.
/rri)al rate (lambda8. +ver3 queueing s3stem must have a $ustomer arrival rate.
This num)er is a rate, whi$h means that a time unit 7hourB da3B et$.8 is asso$iated
with the arrival rate. This is $riti$al )e$ause the time unit must mat$h the time unit
of the ne=t arameter.
Ser)ice rate (m'8. The num)er to )e entered is the rate at whi$h individual servers
ro$ess $ustomers. (ote that this is a rate. That isB it is $ommon to :now the
servi$e time. 9ut this time must )e $onverted to a rate and the time 'nit of this rate
m'st match the time 'nit of the arri)al rate.
8'mber of ser)ers. The minimum and default value for the num)er of servers is 1.
There are other inut arameters for the other models whi$h will )e e=lained in
the e=amles.
Time 'nit. There is a dro4down )o= for the time unit. This serves two uroses.
One is to remind 3ou that the arrival rate and servi$e rate must )oth )e )ased on
the same time unit. Se$ondB if 3ou sele$t hoursB then the outut disla3 will show
MminutesL and Mse$ondsL. If notB the outut disla3 will show M"/Qtimes answer.L
49a!p%e /: ,he M/M/1 !ode%
'ustomers arrive at a rate of &" er hour a$$ording to a Poisson arrival ro$ess.
There is one server who serves $ustomers in an average time of & minutes
a$$ording to an e=onential distri)ution.
The outut s$reen for this s3stem follows. (oti$e that the arrival rate is entered as
&"B as given in the ro)lem statement. The servi$e time of & minutes must )e
$onverted to a rate of 3/ er hour.
/)erage ser)er 'tili5ation. This is the er$entage of time that ea$h server is )us3
on average. In the e=amleB the one server is )us3 1% er$ent of the time.
/)erage n'mber in the 9'e'e (line). This is the average num)er of $ustomers who
are in the s3stem waiting for servi$e. That isB the3 have not 3et )egun their servi$e.
In the e=amleB there are !."3 $ustomers waitingB on average.
/)erage n'mber of c'stomers in the s&stem. This is the average num)er of
$ustomers who are either in line or )eing served. In the e=amleB there are ".!
$ustomers in the s3stemB on average.
/)erage time in the 9'e'e (line). This is the average time that a $ustomer sends
waiting )efore servi$e )egins. The time unit is the same as that of the arrival and
servi$e rates. In the e=amleB it is .&1"% ho'rs.
/)erage time in the s&stem. This is the average time that a $ustomer sends
waiting and )eing served. In the e=amle it is .&! ho'rs
#an3 times we want to $onvert the average waiting and s3stem times from hours
to minutes or from minutes to se$onds. The average times will )e multilied )3 "/
or 3"//B and the answers will show )eside the original averages. The num)ers
there e=ress the same time )ut with a unit of min'tes, sin$e the original times
were in hours.
0e $an list the ro)a)ilities 7er$entage of time8 of e=a$tl3 - $ustomers in the
s3stemB the $umulative ro)a)ilities of - or fewer $ustomers )eing in the s3stem
and the de$umulative ro)a)ilit3 of stri$tl3 more than - $ustomers in the s3stem.
The s$reen will aear as follows. ,or e=amleB the ro)a)ilit3 that e=a$tl3 3
$ustomers are in the s3stem is ./1"1B while the ro)a)ilit3 that 3 or fewer
$ustomers are in the s3stem is .43!1. The ro)a)ilit3 that 7stri$tl38 more than 3
$ustomers are in the s3stem is .!"4&. (ote that these ro)a)ilities are availa)le for
all models that have e=onential 7memor3less8 servi$e times.
49a!p%e *: ,he M/D/1 !ode%$
0e have left the data the same as the revious e=amle )ut have $hanged the
model and solved the ro)lem. The solution s$reen followsC
The outut format is the same. 9e$ause the model has $hangedB some of the results
have $hanged. In arti$ularB the num)er of $ustomers in line is &.11"% rather than
the !."3 from the M<M<A s3stem. 7The num)er in line and the time in line in an
M<D<A s3stem are alwa3s half of those in an M<M<A s3stem.8 Pro)a)ilities are not
availa)le sin$e the servi$e times are not e=onential.
49a!p%e (: ,he M/G/1 !ode%
In this modelB servi$e times ma3 have an3 distri)ution. The inut to the routine is
not onl3 the mean servi$e rate )ut also the standard deviation of the servi$e time.
The following s$reen $ontains all of the information for this e=amle. (oti$e that
there is one e=tra row for the inut. The outut is the same. In the e=amleB the
mean rate is still 3/ $ustomers er hourB as )eforeB )ut the servi$e time standard
deviation is ./! ho'rs or 3 minutes.
6ll servi$e distri)utions are a se$ial $ase of the general distri)ution. 6 standard
deviation of 1;rate 3ields the e=onential distri)ution. ,or e=amleB sin$e the
servi$e rate is 3/B if the servi$e time standard deviation is 1;3/ W ./3333B the
model has an e=onential servi$e time distri)ution.
This is shown in the re$eding s$reen. (oti$e that the answers are identi$al to
those in +=amle 1 e=$et for roundoff 7sin$e we used ./333 rather than 1;3/th
e=a$tl38.
6 standard deviation of / will 3ield the $onstant servi$e time 7M<D<A8 model. This
is disla3ed ne=t. 'omare the results with +=amle &B whi$h disla3ed the
M<D<A model.
49a!p%e 1: ,he M/E
k/
1 !ode%$
6nother availa)le servi$e time distri)ution is the +rlang4- distri)ution. The s$reen
)elow e=hi)its the M<0
-
<A model and solution. The onl3 differen$e in the inut is
that the value for - must )e given 7rather than no value or a standard deviation8.
0hen - is oneB as in the following s$reenB then we have an e=onential
distri)ution. 'omare the results with our first e=amle.
49a!p%e +: ,he M/M/s Queue
The most )asi$ question in queueing is what will haen if the num)er of servers
is in$reased. In the s$reen )elow we show the outut for the original situation
e=$et with two servers. 0aiting time is now .//%% hours rather than the .&1%
hours in the original des$rition. To dou)le $he$: the original e=amleB 3ou $an
use the #;#;s model and enter 1 server.
49a!p%e 3: ,he M&M&/ s5ste! with a finite :ueue
In this s3stemB the num)er of waiting sa$es is finite. The t3i$al e=amle is a
telehone s3stem. The e=tra line of inut to this model is the ma=imum allowa)le
s3stem si?e. (oti$e that we said s&stem not waiting. In the following e=amle we
have indi$ated that at most two $ustomers $an )e in the s3stem. This means that no
more than one $an )e waiting with the se$ond )eing served. 7This is a single4line
hone with $all waiting.8 If there were two serversB it would mean that no one $an
)e waiting. 9e $areful when $onsidering the s3stem si?e versus the waiting area
si?e.
NO,4C The model is termed a finite queue )ut it is the s3stem si?eB not the queue
si?eB whi$h is entered into the rogram.
9e$ause the s3stem si?e is limitedB it is ossi)le that $ustomers will arrive at the
s3stem )ut )e )lo$:ed from entering. ThereforeB we define the effe$tive arrival
rate as the a$tual num)er of $ustomers who enter the store rather than arrive at the
store. ,urthermoreB the outut disla3s the er$entage of time 7ro)a)ilit38 that the
s3stem is full.
In the e=amleB onl3 %1 er$ent of the $ustomers who show u enter the s3stemB
$ustomers show u at a rate of &" er hour )ut the effe$tive arrival rate is 11.!3-
er hour. 0hen we disla3 the ro)a)ilities as followsB we see that &1."- er$ent
of the time the s3stem is full 7-W&8. That isB &1."- er$ent of the time when a
hone $all is made it re$eives a )us3 signal.
49a!p%e G: ,he M/M/1 s5ste! with a finite popu%ation
T3i$all3 we assume that the oulation is infinite. In the following s$reenB we are
e=hi)iting a oulation of 13 otential $ustomersB each arriving at a rate of & times
er hour 7for a net otential arrival rate of &"B as in the revious e=amles8. This is
the arrival rate when the3 are not in the s3stem. HoweverB from the outut it $an
)e seen that ea$h $ustomer averages ./11 hours ea$h time he or she arrives. The
effe$tive arrival rate is the 1 arrival er hour times the average num)er of the 13
who are not in the s3stem. In this e=amleB the effe$tive arrival rate is onl3 &&.1
$ustomers er hour 7rather than the otential of &" arrivals er hour8. If servi$e
were )etterB then these $ustomers $ould arrive more frequentl3. The s$reen
in$ludes the ro)a)ilit3 that a $ustomer waits. 7This is not the ro)a)ilit3 that all
servers are )us3B sin$e arrival rates var3 deending on the num)er in the s3stem.8
NO,4: In this modelB the arrival rate to )e entered into the rogram is the arrival
rate ,OR 6( I(*I.I*A62 'ASTO#+R. In man3 te=t)oo:sB the time )etween
arrivals is given. This time must )e $onverted to an arrival rate. ,or e=amleB it
might )e that ea$h of ! $ustomers shows u on average ever3 3/ minutes. This
must )e $onverted to a rate of "/;3/ W & er hour 7er $ustomer8. The rogram will
automati$all3 ad@ust for the num)er of $ustomers. (oti$e that we enter the num)er
& as the arrival rate. It is temting to enter &Q! W1/B )ut this is in$orre$tT
49a!p%e J: ,he M/M/s :ueue with costs
The ne=t s$reen $ontains an e=amle with $osts. 'ustomer $osts $an )e $harged
against either the time a $ustomer sends in the s3stem or $harged against onl3 the
time waiting. 0e $harge U& for ea$h hour the $ustomer waits. This 3ields a total
$ost of U&Q".! $ustomers in the s3stem lus the U4; hour la)or $ost for a total
s3stem $ost of U1% er hour 7)ottom line in ta)le8. 6lternativel3B we might $harge
against the time a $ustomer waits. In this $aseB we have !."33 $ustomers waiting
on average multilied )3 U& for a su)total of U11.&" to whi$h we add the U4 server
$harge 3ielding U1!.&%B as disla3ed in the se$ond line from the )ottom.
Wor7 Measure!ent
This module $an )e used for the three ma@or areas of wor: measurementC time
stud3B $omutation of samle si?e for time stud3B and wor: samling
,i!e Stud5
6 samle s$reen that in$ludes the data aears ne=t. Our ro$ess $onsists of three
elements and we have ta:en ! o)servations of ea$h.
Data
Performance rating. ,or ea$h elementB its erforman$e rating must )e given. The
normal time will )e $omuted as the average time multilied )3 the erforman$e
rating.
Obser)ations. The time o)served for ea$h element must )e entered. In some $asesB
o)servations will )e )ad 7outliers8. In order to e=$lude them from $omutationsB
enter a /B as in the $ase of o)servation & for element &.
/llowance factor. The overall allowan$e fa$tor is given. This allowan$e fa$tor
ad@usts the final time for the sum of all three normal times.
So%ution
The solution s$reen for our e=amle aears )elow.
/)erage. The average for ea$h element is $omuted. (oti$e that the average for
elements 1 and 3 are ta:en over ! valuesB )ut that the average for element & is
ta:en over 4 values sin$e o)servation & was given as / and this is not in$luded in
the averaging ro$ess.
Standard de)iation. The standard deviation for ea$h element is $omutedB
although it is not used for an3 further $omutations in this su)model.
8ormal time. The normal time is $omuted )3 multil3ing the average of the
o)servations )3 the erforman$e rating for that element.
8ormal !rocessing time. The normal ro$essing time is the sum of the normal
times.
Standard time. The standard time is $omuted in one of two wa3s deending on
the te=t)oo:. Some authors useC
Standard time W normal ro$essing time Q 71 V allowan$e fa$tor8
while others useC
standard time W normal ro$essing time ;71 4 allowan$e fa$tor8
If 3ou are using a Prenti$e Hall te=t)oo: then the aroriate formula should )e in
use. If notB lease $he$: "e%p, 6ser Infor!ation to )e $ertain that the software is
listed as using the $orre$t te=t)oo:.
49a!p%e *: .o!putin the sa!p%e si8e
0e resent the data for our se$ond e=amle )elowC
The inut is similar to the time stud3 a)oveB )ut the goal is different. 0e want to
find the minimum samle si?e to )e --.4! er$ent $onfident of our results. The
inut for this su)model is as followsC
/cc'rac& le)el. 0ithin what er$entage do we want our results to holdX ,or
e=amleB for element & we want to )e -!.4! er$ent $onfident that our results are
within 1 er$ent of the true time.
Obser)ations. This is the same as a)ove. The time o)served for ea$h element must
)e entered. In some $asesB o)servations will )e )ad 7outliers8. In order to e=$lude
them from $omutationsB enter a /B as in the $ase of o)servation & for element &.
(onfidence. Si= otions a)out the $onfiden$e level are resented in the dro4down
)o= a)ove the data.
The outut aears )elow. The samle si?es for the three elements are &/B &-%B
and 3 rese$tivel3. Generall3B this means that we use the largest and have &-%
o)servations of ea$h element.
49a!p%e (: Wor7 Sa!p%in
6n e=amle of )oth the inut and outut for wor: samling aears )elowC
Pro!ortion. This is the estimated roortion of time )eing sent in the tas:.
/cc'rac& le)el. This is similar to the a$$ura$3 level a)ove. 0ithin what
er$entage do we want our results to holdX ,or e=amleB we want to )e --.%3
er$ent $onfident that our results are within ! er$ent of the true roortion.
(onfidence. Si= otions a)out the $onfiden$e level are resented in the dro4down
)o= a)ove the data
The result is siml3 the samle si?e. In this $aseB we must samle %!" time units.
6endi$es
0ppendi9 0$ .usto!i8ation due to te9t-oo7
#odule 'ustomi?ation
*e$ision 6nal3sis Row names
Hurwi$? not in$luded in all te=t)oo:s
,ore$asting In$lusion of eriod 1 in error $omutation for
e=onential smoothing methods
'omutations for e=onential smoothing with
trend model varies )3 te=t)oo:
Inventor3 +O5 with shortages model not in$luded in all
te=t)oo:s
Safet3 sto$: model for (ormal distri)ution varies
)3 te=t)oo:
>o) sho s$heduling #ethod names
(um)er of oerations $olumn not in$luded in all
te=t)oo:s
2inear rogramming Simle= ta)leau disla3
2o$ation #odel names
#aterials Requirements
Planning
Ta)le disla3 7order of rows8
5ualit3 $ontrol 6$$etan$e samling model not in$luded in all
te=t)oo:s
Simulation Random num)er ta)le
0aiting 2ine #odel availa)ilit3 and names
(otation
0or: measurement 'omutation of standard time varies )3 te=t)oo:
0ppendi9 D$ 6sefu% hints for !odu%es
Modu%e "e%pfu% "ints
6ggregate Planning This is a model where it ma3 )e useful to use the
months as the row name otion on the $reation
s$reenB rather than the default names of aeriod 1aB
aeriod &aB et$. 6lsoB the 'o3 down )utton is useful
for entering $onstant $aa$ities. In order to use the
transortation su)model for aggregate lanning the
$osts $an not var3 from eriod to eriod. If the $osts
do var3B 3ou must set u the model 3ourself using the
transortation model.
6ssem)l3 2ine
9alan$ing
9e sure the time unit for the tas:s is set roerl3.
6ssignment +nter a=a to have a large $ost 7----8 la$ed in the $ell
to re$lude the assignment from )eing made.
9rea:even ,or ro)lems with & otions 6(* revenue siml3
treat revenue as a third otion.
*e$ision Ta)les Ase PWP in the ro)a)ilit3 row to set all ro)a)ilities
to )e equal for the de$ision tree. (ote that in the 1
eriod inventor3 modelB the rofits on e=$ess units or
shorted units $an )e negativeB that isB a loss.
,ore$asting The standard error is $omuted using n4& in the
denominator.
Integer < mi=ed integer
rogramming
It is not ne$essar3 to in$lude the nonnegativit3
restri$tions 7e.g.B =^W /8 when $ounting the num)er
of $onstraints. The )ottom left $ell has a dro down
)o= whi$h $an )e used to set all varia)les to the same
t3e.
Inventor3 The holding $ost in the +O5 )ased models $an )e
entered as a num)er or as a er$ent. The entr3 .3/
means 3/ $ents while the entr3 3/Z means 3/Z of
the unit $ost.
2inear rogramming It is not ne$essar3 to in$lude the nonnegativit3
restri$tions 7e.g.B =^W /8 when $ounting the num)er
of $onstraints. This is one of two modules where it is
ossi)le to ste through the solution ro$edure.
#RP *ou)le4$li$:ing on the data ta)le will disla3 the
#RP Produ$t Tree. 6lsoB the Pdo not disla3 /sa
)utton $an )e ver3 useful in this module
5ualit3 ,or $ontrol $hartsB 3ou ma3 use the average as the
$enter line or set the $enter line 3ourself.
Statisti$s This module in$ludes a (ormal *istri)ution
$al$ulation su)model. The same $al$ulations $an )e
erformed with the (ormal distri)ution tool 7tool)ar
or main menu TOO2S8 whi$h has a different 7)etter8
user interfa$e.
Transortation +nter a=a to have a large $ost 7----8 la$ed in the $ell
to re$lude units )eing shied from the original to
the destination. This is one of two modules where it
is ossi)le to ste through the solution ro$edure.
0aiting 9oth arrivals and servi$e are given )3 R6T+s rather
than TI#+s. 9e sure that the time unit for the arrival
rate and servi$e rate are the same.