Introducing Linear Programming

though the Merton Truck Company

case
Decision Analysis
2016 17 Session
(selected slides for distribution)

In Search of a Better Solution

Contribution

from Model 101: $3000

Contribution from Model 102: $5000
Current solution:
If
If there
there is
is aa better
better solution,
solution, it
it is
is not
not here!
here!

In Search of a Better Solution

Contribution

from Model 101: $3000

Contribution from Model 102: $5000
Current solution:
If
If there
there is
is aa better
better solution,
solution, it
it is
is not
not here!
here!

In Search of a Better Solution

Contribution

from Model 101: $3000

Contribution from Model 102: $5000

Availabl
e

Current solution:

Resourc
e

Remaini
ng

Remaini
ng

Remaini
ng

Eng.
Assy.

4000

4000

3998

4000

Mtl.
Stmp.

6000

5000

1000

4998

1002

5002

998

101 Assy.

5000

102 Assy

4500

2000
3000
$10,500,000
$10,500,000
4500
0

2000
3000
$10,495,000
$10,495,000
4497
3

2004
2996
$10,501,000
$10,501,000
4497
3

In Search of a Better Solution

Contribution

from Model 101: $3000

Contribution from Model 102: $5000

Availabl
e

Current solution:

Resourc
e

Remaini
ng

Eng.
Assy.

4000

4000

Mtl.
Stmp.

6000

5000

1000

101 Assy.

5000

102 Assy

4500

2000
3000
$10,500,000
$10,500,000
4500
0

STEP

Remaini
ng
NO CHANGE
3998
2 HOURS
4000
USE 2 EXTRA
USE 4 EXTRA HOURS
4998
1002
5002
USE 3 LESS HOURS

2000
3000
INCREASE
$10,495,000
BY $1000
$10,495,000
4497
3

Remaini
ng
0
998

2004
2996
$10,501,000
$10,501,000
4497
3

In Search of a Better Solution

Contribution

from Model 101: $3000

Contribution from Model 102: $5000

Availabl
e

Current solution:

Resourc
e

Remaini
ng

Eng.
Assy.

4000

4000

Mtl.
Stmp.

6000

5000

1000

101 Assy.

5000

102 Assy

4500

2000
3000
$10,500,000
$10,500,000
4500
0

Remaini
ng

Remaini
ng

3998
2
500
steps
After
500
steps

4000

4998

6000

1002

2000
3000
$10,495,000
$10,495,000
4497
3

4000
1000
$11,000,000
$11,000,000
3000
1500

In Search of a Better Solution

Contribution

from Model 101: $3000

Contribution from Model 102: $5000
Current solution:

In Search of a Better Solution

Contribution

from Model 101: $3000

Contribution from Model 102: $5000

Availabl
e

Current solution:

Resourc
e

Remaini
ng

Remaini
ng

Remaini
ng

Eng.
Assy.

4000

4000

3998

3999

Mtl.
Stmp.

6000

6000

5998

6000

101 Assy.

5000

102 Assy

4500

4000
1000
$11,000,000
$11,000,000
3000
1500

4000
1000
$10,995,000
$10,995,000
2997
1503

4002
998
$10,998,000
$10,998,000
2997
1503

Building a Model
What is a solution to the problem?
(What are you allowed to change?)
Decision variables

How much change will be tolerated?

Constraints
How do you measure how good a
solution is?
Objective function
What is a best solution?
Objective

(Engine Assembly)
(Metal Stamping)
(Model 101 Assembly)
(Model 102 Assembly)

Finding optimal solutions: Graphical

Method

(linear function)

Di
re
ct

io

of

in

cr
ea
se

Finding optimal solutions: Graphical

Method
(linear function)
Subject to

Better solution

Set of feasible solutions

(obeys all constraints)

Di
r
cr . of
ea
se

Best
Best solution
solution must
must be
be at
at the
the
boundary
boundary

in

Finding optimal solutions: Graphical

Method
(linear function)
Subject to

Better solution

Set of feasible solutions

(obeys all constraints)

Di
r
cr . of
ea
se

Best
Best solution
solution must
must be
be at
at aa
corner
corner

in

Finding optimal solutions: Graphical

Method

Engine
Assembly
Metal
Stamping
Model 101
Assembly
Model 102
Assembly

Finding optimal solution: Graphical

method

M
M
M

Million

Tying up the two approaches

Current solution:

Tying up the two approaches

Current solution:

5
2

6
4

1
1
4
4
6
6

2
2
7
7

3
3
5
5
8
8

Tying up the two approaches

Metal
Stamping

Engine
Assembly

Model 102
Assembly

Pr
op
to or
1 0 t io
00 nal

Current solution:

Resourc
e

Available

Eng. Assy.

4000

4000

Mtl. Stmp.

6000

5000

1000

101 Assy.

5000

2000

3000

102 Assy

4500

4500

Remaini
ng

Tying up the two approaches

Remaining
Mtl. Stmp.
resource
Remaining
102 Assy.
resource

Current solution:

Resourc
e

Available

Remaini
ng

Eng. Assy.

4000

4000

Mtl. Stmp.

6000

5002

998

101 Assy.

5000

2004

2996

102 Assy

4500

4497

Tying up the two approaches

101 Assembly resource

runs out here

So
lut
io
thi n m
s w ove
s
ay

Metal stamping resource

runs out here

Resourc
e

Availabl
e

Remaini
ng

Remaini
ng

Eng.
Assy.

4000

4000

4000

Mtl.
Stmp.

6000

5000

1000

5002

998

101 Assy.

5000

2000

3000

2004

1996

102 Assy

4500

4500

4497

And now to Microsoft Excel