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PROBLEM
PROBLEM STATEMENT
Allen Steel & General Engineering, south Cochin is famous for production of class A,
class B and Class C variants of steel from raw steel. The raw steel consists of only iron and
impurities such as nickel, cobalt etc. To make it durable steel they add 6.5% of carbon black
into the raw steel and make it real steel. In the process of steel manufacturing they make
use of Bessemer converter of steel. There is an availability of 300 unit of raw steel in the
inventory of Allen steel industries. There is a need of 30 units of raw steel in the process of
manufacture of class A kind of steel and heir is a need of 20 units of raw steel in the process
of manufacture of class B kind of steel and there is a need of 25 units of raw steel in the
process of manufacture of class A kind of steel. The labour availability of manufacturing is
110 hours of production. There is a need of 5 labour hours in the process of manufacture of
class A kind of steel. For the manufacturing of class B steel they requires 10 labour hours of
working, There is a need of 7 labour hours in the process of manufacture of class B kind of
steel. The process consists of melting of raw steel and adding carbon to it to make it pure
steel. The total working hours provided by a melting plant is 1000 hours. And for class B
manufacturing process we need 20 hours moulding platform and For class C manufacturing
process we need 30 hours melting platform. For class A manufacturing we require it is a
requirement of 10 hours of melting platform. The next process is moulding of melted steel.
There is a 200 hour moulding platform available of the industry per day. Class A requires 5
hrs of moulding, where as 3 for class B and 4 hrs for class C type of steel. There is a need of
cutting of moulded steel into shaped corrugated steel bars which requires a 4 hr cutting
machine service for a class A steel. It requires a 2 hr cutting machine process for a Class B
steel. There is a need of 4 hrs in cutting machine for a class C steel. As the cutting machines
available in the plant are 300 hrs the total time taking for this should be less than that. The
Bessemer plant where these processes are carried on is available for 1200 hrs. There is a
need of 9 hrs Bessemer steel processing for class A steel, 8 hr treatment for Class B steel and
7 hr treatment for Class c steel. Works such as smoothing and finishing is also required
before exporting the product. It requires 30 minutes of finishing for class A, 5 minutes for
class B and 9 minutes for class C. Total time available for this is 800 minutes.
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As the company production manager thinks that making less than 2 units f class C would
make a loss in the process, he insists the production of Class C should be more than 2. He
also puts forward one more condition that the manufacture of Class C should be greater
than class B and Class A.
The profit which we they acquire from making a class A steel is 6l per unit, for class B there
is a profit of 8l per unit and for class C there is a profit of 7l. The management wants to
maximise the profit from the production.
Resource Requirement and Total Availability:
The resources required for the production of different types are different. The table below
summarizes the resource requirement for producing different variants of steels and the
total resources available with the company.
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(i) PROBLEM FORMULATION
Decision variables:
X1: Quantity of type A to be produced
X2: Quantity of type B to be produced.
X3: Quantity of type C to be produced
Objective function:
MAXZ = 6X1+8X2+7X3
Constraints:
30X1+20X2+25X3<=300 (Raw steel available)
5X1+10X2+7X3<=110 (Labour availability)
10X1+20X2+30X3<=1000 (Melting machine availability)
5X1+3X2+4X3<=200 (Moulding furnace availability)
4X1+2X2+3X3<=300 (Cutting machine availability)
9X1+18X2+7X3<=1200 (Bessemer converter constraint)
30X1+5X2+9X3<=800 (Finishing and packaging)
X3>=2 (Type C constraint)
X1+X2-X3<=0 (Type A,B,C Constriant)
X1>=0,X2>=0,X3>=0 (Non negativity)
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Excel Solution:
According to the sheet, the target cell is the objective function. Problem is of
maximization type, that's why Max is selected and all the constraints are defined under
Subject to the constraints heading. Also we have to select linear programing, non-
negative constraints and integer constraints under Options.
Following are the screenshots of the solution obtained from MS Excel using Solver:
APPLYING SOLVER
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FINAL SOLUTION:
ANSWER REPORT
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INTERPRETATION
As per the solution obtained using the excel solver, the company should produce type b and
type c steel varients more to earn maximum profit., ie 96L
The type B steel which the company should produce is 5 units.
The type C steel which the company should produce is 8 units
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REFERENCES
[1] Data Analysis and Decision Making with Microsoft Excel Authors: S. Christian Albright,
Wayne I Winston, Christopher Zappe
[2] Allen Steel & General Engineering, south Cochin, Production manager Mr Roy Thomas.
[3] http://en.wikipedia.org/wiki/Steelmaking