Chapter 4

TRANSPORTATION AND
ASSIGNMENT MODELS
Learning Objectives
After completing this chapter, students will be able to:

1. Structure special LP problems using the

transportation and assignment models
2. Use the northwest and stepping-stone methods
3. Solve assignment problems with the Hungarian
(matrix reduction) method
Chapter Outline
1 Introduction
2 Setting Up a Transportation Problem
3 Developing an Initial Solution: Northwest Corner
Rule
4 Stepping-Stone Method: Finding a Least-Cost
Solution
5 Unbalanced Transportation Problems
Chapter Outline
8 Degeneracy in Transportation Problems
9 More Than One Optimal Solution
10 Maximization Transportation Problems
11 Assignment Model Approach
Unbalanced Assignment Problems
Maximization Assignment Problems
Introduction
In this chapter we will explore two special linear
programming models
The transportation model
The assignment model
Because of their structure, they can be solved
more efficiently than the simplex method
These problems are members of a category of LP
techniques called network flow problems
Introduction
Transportation model
The transportation problem deals with the distribution
of goods from several points of supply (sources) to a
number of points of demand (destinations)
Usually we are given the capacity of goods at each
source and the requirements at each destination
Typically the objective is to minimize total
transportation and production costs
Introduction
Example of a transportation problem in a network format

Factories Warehouses
(Sources) (Destinations)

100 Units Des Moines Albuquerque 300 Units

300 Units Evansville Boston 200 Units

300 Units Fort Lauderdale Cleveland 200 Units

Capacities Shipping Routes Requirements

Setting Up a
Transportation Problem
The Executive Furniture Corporation manufactures office
desks at three locations: Des Moines, Evansville, and Fort
Lauderdale
The firm distributes the desks through regional
warehouses located in Boston, Albuquerque, and
Cleveland
Estimates of the monthly production capacity of each
factory and the desks needed at each warehouse are
shown in figure
Setting Up a
Transportation Problem
Production costs are the same at the three factories so
the only relevant costs are shipping from each source to
each destination
Costs are constant no matter the quantity shipped
The transportation problem can be described as how to
select the shipping routes to be used and the number of
desks to be shipped on each route so as to minimize total
transportation cost
Restrictions regarding factory capacities and warehouse
requirements must be observed
Setting Up a
Transportation Problem
The first step is setting up the transportation table
Its purpose is to summarize all the relevant data and
keep track of algorithm computations

Transportation costs per desk for Executive Furniture

TO
FROM ALBUQUERQUE BOSTON CLEVELAND
DES MOINES $5 $4 $3

EVANSVILLE $8 $4 $3

FORT LAUDERDALE $9 $7 $5
Setting Up a
Transportation Problem
Geographical locations of Executive Furnitures factories
and warehouses

Boston

Cleveland
Des Moines Factory

Evanston

Warehouse
Albuquerque

Fort Lauderdale
Setting Up a
Transportation Problem
Transportation table for Executive Furniture Des Moines
capacity
constraint

TO WAREHOUSE WAREHOUSE WAREHOUSE FACTORY

AT AT AT CAPACITY
FROM ALBUQUERQUE BOSTON CLEVELAND (SUPPLY)

DES MOINES $5 $4 $3
100
FACTORY

EVANSVILLE $8 $4 $3
300
FACTORY

FORT LAUDERDALE $9 $7 $5
300
FACTORY

WAREHOUSE
REQUIREMENTS 300 200 200 700
(DEMAND)
Cell representing a
Total supply source-to-destination
Cost of shipping 1 unit from Cleveland (Evansville to Cleveland)
and demand
Fort Lauderdale factory to warehouse shipping assignment
Boston warehouse demand that could be made
Setting Up a
Transportation Problem
In this table, total factory supply exactly equals
total warehouse demand
When equal demand and supply occur, a
balanced problem is said to exist
This is uncommon in the real world and we have
techniques to deal with unbalanced problems
Developing an Initial Solution:
Northwest Corner Rule
Once we have arranged the data in a table, we must
establish an initial feasible solution
One systematic approach is known as the northwest
corner rule
Start in the upper left-hand cell and allocate units to
shipping routes as follows
1. Exhaust the supply (factory capacity) of each row before
moving down to the next row
2. Exhaust the demand (warehouse) requirements of each column
before moving to the right to the next column
3. Check that all supply and demand requirements are met.
In this problem it takes five steps to make the initial
shipping assignments
Developing an Initial Solution:
Northwest Corner Rule
1. Beginning in the upper left hand corner, we assign 100
units from Des Moines to Albuquerque. This exhaust the
supply from Des Moines but leaves Albuquerque 200
desks short. We move to the second row in the same
column.
TO ALBUQUERQUE BOSTON CLEVELAND FACTORY
FROM (A) (B) (C) CAPACITY

DES MOINES $5 $4 $3
(D) 100 100

EVANSVILLE $8 $4 $3
300
(E)

FORT LAUDERDALE $9 $7 $5
300
(F)

WAREHOUSE
300 200 200 700
REQUIREMENTS
2. Assign 200 units from Evansville to Albuquerque. This
meets Albuquerques demand. Evansville has 100 units
remaining so we move to the right to the next column of
the second row.
TO ALBUQUERQUE BOSTON CLEVELAND FACTORY
FROM (A) (B) (C) CAPACITY

DES MOINES $5 $4 $3
100 100
(D)

EVANSVILLE $8 $4 $3
(E) 200 300

FORT LAUDERDALE $9 $7 $5
300
(F)

WAREHOUSE
300 200 200 700
REQUIREMENTS
3. Assign 100 units from Evansville to Boston. The
Evansville supply has now been exhausted but Boston is
still 100 units short. We move down vertically to the next
row in the Boston column.

TO ALBUQUERQ BOSTON CLEVELAND FACTORY

FROM UE (A) (B) (C) CAPACITY

DES MOINES $5 $4 $3
100 100
(D)

EVANSVILLE $8 $4 $3
(E)
200 100 300

FORT LAUDERDALE $9 $7 $5
300
(F)

WAREHOUSE
300 200 200 700
REQUIREMENTS
4. Assign 100 units from Fort Lauderdale to Boston. This
fulfills Bostons demand and Fort Lauderdale still has 200
units available.

TO ALBUQUERQ BOSTON CLEVELAND FACTORY

FROM UE (A) (B) (C) CAPACITY

DES MOINES $5 $4 $3
100 100
(D)

EVANSVILLE $8 $4 $3
200 100 300
(E)

FORT LAUDERDALE $9 $7 $5
(F) 100 300

WAREHOUSE
300 200 200 700
REQUIREMENTS
5. Assign 200 units from Fort Lauderdale to Cleveland. This
exhausts Fort Lauderdales supply and Clevelands
demand. The initial shipment schedule is now complete.

TO ALBUQUERQUE BOSTON CLEVELAND FACTORY

FROM (A) (B) (C) CAPACITY

DES MOINES $5 $4 $3
100 100
(D)

EVANSVILLE $8 $4 $3
200 100 300
(E)

FORT LAUDERDALE $9 $7 $5
(F)
100 200 300

WAREHOUSE
300 200 200 700
REQUIREMENTS
 We can easily compute the cost of this shipping
assignment

ROUTE
UNITS PER UNIT TOTAL
FROM TO SHIPPED x COST ($) = COST ($)
D A 100 5 500
E A 200 8 1,600
E B 100 4 400
F B 100 7 700
F C 200 5 1,000
4,200

This solution is feasible but we need to check to

see if it is optimal
Stepping-Stone Method: Finding
a Least Cost Solution
The stepping-stone method is an iterative
technique for moving from an initial feasible
solution to an optimal feasible solution
There are two distinct parts to the process
Testing the current solution to determine if
improvement is possible
Making changes to the current solution to obtain an
improved solution
This process continues until the optimal solution
is reached
 Stepping-Stone Method:
Finding a Least Cost Solution
There is one very important rule
The number of occupied routes (or squares) must always be
equal to one less than the sum of the number of rows plus
the number of columns
In the Executive Furniture problem this means the initial
solution must have 3 + 3 1 = 5 squares used
Occupied shipping Number Number of
routes (squares) = of rows + columns 1

When the number of occupied rows is less than

this, the solution is called degenerate
Testing the Solution for
Possible Improvement
The stepping-stone method works by testing
each unused square in the transportation table
to see what would happen to total shipping costs
if one unit of the product were tentatively
shipped on an unused route
There are five steps in the process
Five Steps to Test
Unused Squares with the
Stepping-Stone Method

1. Select an unused square to evaluate

2. Beginning at this square, trace a closed path back to the
original square via squares that are currently being used
with only horizontal or vertical moves allowed
3. Beginning with a plus (+) sign at the unused square, place
alternate minus () signs and plus signs on each corner
square of the closed path just traced
Five Steps to Test Unused
Squares with the Stepping-
Stone Method
4. Calculate an improvement index by adding together the
unit cost figures found in each square containing a plus
sign and then subtracting the unit costs in each square
containing a minus sign
5. Repeat steps 1 to 4 until an improvement index has been
calculated for all unused squares. If all indices computed
are greater than or equal to zero, an optimal solution
has been reached. If not, it is possible to improve the
current solution and decrease total shipping costs.
Squares with the Stepping-Stone
Method
For the Executive Furniture Corporation data

Steps 1 and 2. Beginning with Des MoinesBoston

route we trace a closed path using only currently
occupied squares, alternately placing plus and
minus signs in the corners of the path
In a closed path, only squares currently used for
shipping can be used in turning corners
Only one closed route is possible for each square
we wish to test
Five Steps to Test Unused Squares
with the Stepping-Stone Method
Step 3. We want to test the cost-effectiveness of the Des
MoinesBoston shipping route so we pretend we are
shipping one desk from Des Moines to Boston and put a plus
in that box
But if we ship one more unit out of Des Moines
we will be sending out 101 units
Since the Des Moines factory capacity is only
100, we must ship fewer desks from Des Moines
to Albuquerque so we place a minus sign in that
box
But that leaves Albuquerque one unit short so we
must increase the shipment from Evansville to
Albuquerque by one unit and so on until we
complete the entire closed path
Five Steps to Test Unused Squares
with the Stepping-Stone Method
Evaluating the unused Des Warehouse A Warehouse B

$5 $4
MoinesBoston shipping Factory
D 100
route +

Factory
+ $8 $4
E 200 100

TO FACTORY
ALBUQUERQUE BOSTON CLEVELAND
FROM CAPACITY
$5 $4 $3
DES MOINES 100 100

$8 $4 $3
EVANSVILLE 200 100 300

$9 $7 $5
FORT LAUDERDALE 100 200 300

WAREHOUSE
300 200 200 700
REQUIREMENTS
 Evaluating the unused Des Warehouse A Warehouse B
MoinesBoston shipping 99 $5 $4
Factory
route D 100 1
+

Factory 201 + 99 $4
E 200 100

TO FACTORY
ALBUQUERQUE BOSTON CLEVELAND
FROM Result
CAPACITY of Proposed
$5 $4 $3 Shift in Allocation
DES MOINES 100 100
= 1 x $4
$8 $4 $3 1 x $5
EVANSVILLE 200 100 300 + 1 x $8
1 x $4 = +$3
$9 $7 $5
FORT LAUDERDALE 100 200 300

WAREHOUSE
300 200 200 700
REQUIREMENTS
Five Steps to Test Unused Squares
with the Stepping-Stone Method
Step 4. We can now compute an improvement index (Iij) for
the Des MoinesBoston route
We add the costs in the squares with plus signs
and subtract the costs in the squares with minus
signs
Des Moines
Boston index = IDB = +$4 $5 + $5 $4 = + $3

This means for every desk shipped via the Des

MoinesBoston route, total transportation cost
will increase by $3 over their current level
Five Steps to Test Unused Squares
with the Stepping-Stone Method
Step 5. We can now examine the Des MoinesCleveland
unused route which is slightly more difficult to draw

Again we can only turn corners at squares that

represent existing routes
We must pass through the EvansvilleCleveland
square but we can not turn there or put a + or
sign
The closed path we will use is
+ DC DA + EA EB + FB FC
Five Steps to Test Unused Squares with
the Stepping-Stone Method
Evaluating the Des MoinesCleveland shipping route

TO FACTORY
ALBUQUERQUE BOSTON CLEVELAND
FROM CAPACITY
$5 $4 $3
DES MOINES 100 100
+
$8 $4 $3
EVANSVILLE 200 100 300
+
$9 $7 $5
FORT LAUDERDALE 100 200 300
+
WAREHOUSE
300 200 200 700
REQUIREMENTS

Des MoinesCleveland
improvement index = IDC = + $3 $5 + $8 $4 + $7 $5 = + $4
Five Steps to Test Unused Squares
with the Stepping-Stone Method
Opening the Des MoinesCleveland route will not
lower our total shipping costs
Evaluating the other two routes we find
Evansville-
Cleveland index = IEC = + $3 $4 + $7 $5 = + $1
The closed path is
+ EC EB + FB FC
Fort Lauderdale
Albuquerque index = IFA = + $9 $7 + $4 $8 = $2
The closed path is
+ FA FB + EB EA
So opening the Fort Lauderdale-Albuquerque
route will lower our total transportation costs
Obtaining an Improved Solution

In the Executive Furniture problem there is only one

unused route with a negative index (Fort Lauderdale-
Albuquerque)
If there was more than one route with a negative index,
we would choose the one with the largest improvement
We now want to ship the maximum allowable number of
units on the new route
The quantity to ship is found by referring to the closed
path of plus and minus signs for the new route and
selecting the smallest number found in those squares
containing minus signs
Obtaining an Improved Solution

To obtain a new solution, that number is added to all

squares on the closed path with plus signs and subtracted
from all squares the closed path with minus signs
All other squares are unchanged
In this case, the maximum number that can be shipped is
100 desks as this is the smallest value in a box with a
negative sign (FB route)
We add 100 units to the FA and EB routes and subtract
100 from FB and EA routes
This leaves balanced rows and columns and an improved
solution
 Obtaining an Improved Solution

Stepping-stone path used to evaluate route FA

TO FACTORY
A B C
FROM CAPACITY
$5 $4 $3
D 100 100

$8 $4 $3
E 200 100 300

$9 $7 $5
F 100 200 300
+
WAREHOUSE
300 200 200 700
REQUIREMENTS
 Obtaining an Improved Solution
Second solution to the Executive Furniture problem

TO FACTORY
A B C
FROM CAPACITY
$5 $4 $3
D 100 100

$8 $4 $3
E 100 200 300

$9 $7 $5
F 100 200 300

WAREHOUSE
300 200 200 700
REQUIREMENTS

Total shipping costs have been reduced by (100

units) x ($2 saved per unit) and now equals $4,000
 Obtaining an Improved Solution
This second solution may or may not be optimal
To determine whether further improvement is possible,
we return to the first five steps to test each square that is
now unused
The four new improvement indices are
D to B = IDB = + $4 $5 + $8 $4 = + $3
(closed path: + DB DA + EA EB)
D to C = IDC = + $3 $5 + $9 $5 = + $2
(closed path: + DC DA + FA FC)
E to C = IEC = + $3 $8 + $9 $5 = $1
(closed path: + EC EA + FA FC)
F to B = IFB = + $7 $4 + $8 $9 = + $2
(closed path: + FB EB + EA FA)
 Obtaining an Improved Solution

Path to evaluate for the EC route

TO FACTORY
A B C
FROM CAPACITY
$5 $4 $3
D 100 100

$8 $4 $3
E 100 200 300

$9 $7 $5
F 100 200 300

WAREHOUSE
300 200 200 700
REQUIREMENTS

An improvement can be made by shipping the maximum

allowable number of units from E to C
 Obtaining an Improved Solution

Total cost of third solution

ROUTE
DESKS PER UNIT TOTAL
FROM TO SHIPPED x COST ($) = COST ($)
D A 100 5 500
E B 200 4 800
E C 100 3 300
F A 200 9 1,800
F C 100 5 500
3,900
 Obtaining an Improved Solution

Third and optimal solution

TO FACTORY
A B C
FROM CAPACITY
$5 $4 $3
D 100 100

$8 $4 $3
E 200 100 300

$9 $7 $5
F 200 100 300

WAREHOUSE
300 200 200 700
REQUIREMENTS
 Obtaining an Improved Solution
This solution is optimal as the improvement indices that
can be computed are all greater than or equal to zero

D to B = IDB = + $4 $5 + $9 $5 + $3 $4 = + $2
(closed path: + DB DA + FA FC + EC EB)
D to C = IDC = + $3 $5 + $9 $5 = + $2
(closed path: + DC DA + FA FC)
E to A = IEA = + $8 $9 + $5 $3 = + $1
(closed path: + EA FA + FC EC)
F to B = IFB = + $7 $5 + $3 $4 = + $1
(closed path: + FB FC + EC EB)
 Summary of Steps in Transportation
Algorithm (Minimization)
1. Set up a balanced transportation table
2. Develop initial solution using either the northwest corner
method or Vogels approximation method
3. Calculate an improvement index for each empty cell
using either the stepping-stone method or the MODI
method. If improvement indices are all nonnegative, stop
as the optimal solution has been found. If any index is
negative, continue to step 4.
4. Select the cell with the improvement index indicating the
greatest decrease in cost. Fill this cell using the stepping-
stone path and go to step 3.
Unbalanced Transportation
Problems
In real-life problems, total demand is frequently not
equal to total supply
These unbalanced problems can be handled easily by
introducing dummy sources or dummy destinations
If total supply is greater than total demand, a dummy
destination (warehouse), with demand exactly equal to
the surplus, is created
If total demand is greater than total supply, we introduce
a dummy source (factory) with a supply equal to the
excess of demand over supply
Unbalanced Transportation
Problems
In either case, shipping cost coefficients of zero are
assigned to each dummy location or route as no goods
will actually be shipped
Any units assigned to a dummy destination represent
excess capacity
Any units assigned to a dummy source represent unmet
demand
Demand Less Than Supply
Suppose that the Des Moines factory increases its rate of
production from 100 to 250 desks
The firm is now able to supply a total of 850 desks each
period
Warehouse requirements remain the same (700) so the
row and column totals do not balance
We add a dummy column that will represent a fake
warehouse requiring 150 desks
This is somewhat analogous to adding a slack variable
We use the northwest corner rule and either stepping-
stone or MODI to find the optimal solution
Demand Less Than Supply
Initial solution to an unbalanced problem where demand
is less than supply
TO DUMMY TOTAL
FROM
A B C WAREHOUSE AVAILABLE
$5 $4 $3 0
D 250 250

$8 $4 $3 0
E 50 200 50 300

$9 $7 $5 0
F 150 150 300

WAREHOUSE
300 200 200 150 850
REQUIREMENTS

Total cost = 250($5) + 50($8) + 200($4) + 50($3) + 150($5) + 150(0) = $3,350

New Des Moines

capacity
Demand Greater than Supply

The second type of unbalanced condition occurs

when total demand is greater than total supply
In this case we need to add a dummy row
representing a fake factory
The new factory will have a supply exactly equal
to the difference between total demand and total
real supply
The shipping costs from the dummy factory to
each destination will be zero
Demand Greater than Supply
Unbalanced transportation table for Happy
Sound Stereo Company

TO WAREHOUSE WAREHOUSE WAREHOUSE

FROM A B C PLANT SUPPLY
$6 $4 $9
PLANT W 200

$10 $5 $8
PLANT X 175

$12 $7 $6
PLANT Y 75

Totals
WAREHOUSE 450
DEMAND
250 100 150
500
do not
balance
Demand Greater than Supply
Initial solution to an unbalanced problem in
which demand is greater than supply
TO WAREHOUSE WAREHOUSE WAREHOUSE
PLANT SUPPLY
FROM A B C
$6 $4 $9
PLANT W 200 200

$10 $5 $8
PLANT X 50 100 25 175

$12 $7 $6
PLANT Y 75 75

0 0 0
DUMMY PLANT 50 50

WAREHOUSE
250 100 150 500
DEMAND

Total cost of initial solution = 200($6) + 50($10) + 100($5) + 25($8) + 75($6)

+ $50(0) = $2,850
 Degeneracy in Transportation
Problems
Degeneracy occurs when the number of occupied squares
or routes in a transportation table solution is less than
the number of rows plus the number of columns minus 1
Such a situation may arise in the initial solution or in any
subsequent solution
Degeneracy requires a special procedure to correct the
problem since there are not enough occupied squares to
trace a closed path for each unused route and it would be
impossible to apply the stepping-stone method or to
calculate the R and K values needed for the MODI
technique
 Degeneracy in Transportation
Problems
To handle degenerate problems, create an artificially
occupied cell
That is, place a zero (representing a fake shipment) in
one of the unused squares and then treat that square as
if it were occupied
The square chosen must be in such a position as to allow
all stepping-stone paths to be closed
There is usually a good deal of flexibility in selecting the
unused square that will receive the zero
Degeneracy in an Initial Solution

The Martin Shipping Company example illustrates

degeneracy in an initial solution
They have three warehouses which supply three major
retail customers
Applying the northwest corner rule the initial solution
has only four occupied squares
This is less than the amount required to use either the
stepping-stone or MODI method to improve the solution
(3 rows + 3 columns 1 = 5)
To correct this problem, place a zero in an unused square,
typically one adjacent to the last filled cell
Degeneracy in an Initial Solution

Initial solution of a degenerate problem

TO WAREHOUSE
CUSTOMER 1 CUSTOMER 2 CUSTOMER 3
FROM SUPPLY
$8 $2 $6
WAREHOUSE 1 100 100

$10 $9 $9
WAREHOUSE 2 100 20 120

$7 $10 $7
WAREHOUSE 3 80 80

CUSTOMER
100 100 100 300
DEMAND

Possible choices of
cells to address the
degenerate solution
Degeneracy During Later Solution
Stages
A transportation problem can become degenerate after
the initial solution stage if the filling of an empty square
results in two or more cells becoming empty
simultaneously
This problem can occur when two or more cells with
minus signs tie for the lowest quantity
To correct this problem, place a zero in one of the
previously filled cells so that only one cell becomes
empty
Degeneracy During Later Solution
Stages
Bagwell Paint Example
After one iteration, the cost analysis at Bagwell Paint
produced a transportation table that was not
degenerate but was not optimal
The improvement indices are

factory A warehouse 2 index = +2

factory A warehouse 3 index = +1
factory B warehouse 3 index = 15
factory C warehouse 2 index = +11
Only route with
a negative index
Degeneracy During Later Solution
Stages
Bagwell Paint transportation table

TO WAREHOUSE WAREHOUSE WAREHOUSE

FACTORY
FROM 1 2 3
CAPACITY
$8 $5 $16
FACTORY A 70 70

$15 $10 $7
FACTORY B 50 80 130

$3 $9 $10
FACTORY C 30 50 80

WAREHOUSE
150 80 50 280
REQUIREMENT
 Degeneracy During
Later Solution Stages
Tracing a closed path for the factory B warehouse 3
route
TO
WAREHOUSE 1 WAREHOUSE 3
FROM

$15 $7
FACTORY B 50

$3 $10
FACTORY C 30 50

This would cause two cells to drop to zero

We need to place an artificial zero in one of these
cells to avoid degeneracy
 More Than One Optimal Solution
It is possible for a transportation problem to have
multiple optimal solutions
This happens when one or more of the improvement
indices zero in the optimal solution
This means that it is possible to design alternative
shipping routes with the same total shipping cost
The alternate optimal solution can be found by shipping
the most to this unused square using a stepping-stone
path
In the real world, alternate optimal solutions provide
management with greater flexibility in selecting and
using resources
Maximization Transportation Problems

If the objective in a transportation problem is to

maximize profit, a minor change is required in the
transportation algorithm
Now the optimal solution is reached when all the
improvement indices are negative or zero
The cell with the largest positive improvement index is
selected to be filled using a stepping-stone path
This new solution is evaluated and the process continues
until there are no positive improvement indices
Introduction
Assignment model
The assignment problem refers to the class of LP
problems that involve determining the most efficient
assignment of resources to tasks
The objective is most often to minimize total costs or
total time to perform the tasks at hand
One important characteristic of assignment problems
is that only one job or worker can be assigned to one
machine or project
 Assignment Model Approach
The second special-purpose LP algorithm is the
assignment method
Each assignment problem has associated with it a table,
or matrix
Generally, the rows contain the objects or people we
wish to assign, and the columns comprise the tasks or
things we want them assigned to
The numbers in the table are the costs associated with
each particular assignment
An assignment problem can be viewed as a
transportation problem in which the capacity from each
source is 1 and the demand at each destination is 1
 Assignment Model Approach
The Fix-It Shop has three rush projects to repair
They have three repair persons with different talents and
abilities
The owner has estimates of wage costs for each worker
for each project
The owners objective is to assign the three project to the
workers in a way that will result in the lowest cost to the
shop
Each project will be assigned exclusively to one worker
 Assignment Model Approach
Estimated project repair costs for the Fix-It shop
assignment problem

PROJECT

PERSON 1 2 3

Adams $11 $14 $6

Brown 8 10 11

Cooper 9 12 7
 Assignment Model Approach
Summary of Fix-It Shop assignment alternatives and
costs

PRODUCT ASSIGNMENT
LABOR TOTAL
1 2 3
COSTS ($) COSTS ($)
Adams Brown Cooper 11 + 10 + 7 28
Adams Cooper Brown 11 + 12 + 11 34
Brown Adams Cooper 8 + 14 + 7 29
Brown Cooper Adams 8 + 12 + 6 26
Cooper Adams Brown 9 + 14 + 11 34
Cooper Brown Adams 9 + 10 + 6 25
The Hungarian Method
(Floods Technique)
The Hungarian method is an efficient method of finding
the optimal solution to an assignment problem without
having to make direct comparisons of every option
It operates on the principle of matrix reduction
By subtracting and adding appropriate numbers in the
cost table or matrix, we can reduce the problem to a
matrix of opportunity costs
Opportunity costs show the relative penalty associated
with assigning any person to a project as opposed to
making the best assignment
We want to make assignment so that the opportunity
cost for each assignment is zero
Three Steps of the Assignment
Method
1. Find the opportunity cost table by:
(a) Subtracting the smallest number in each row of the
original cost table or matrix from every number in
that row
(b) Then subtracting the smallest number in each
column of the table obtained in part (a) from every
number in that column
2. Test the table resulting from step 1 to see whether an
optimal assignment can be made by drawing the
minimum number of vertical and horizontal straight
lines necessary to cover all the zeros in the table. If the
number of lines is less than the number of rows or
columns, proceed to step 3.
Three Steps of the Assignment
Method

3. Revise the present opportunity cost table by subtracting

the smallest number not covered by a line from every
other uncovered number. This same number is also
added to any number(s) lying at the intersection of
horizontal and vertical lines. Return to step 2 and
continue the cycle until an optimal assignment is
possible.
 Steps in the Assignment Method

Not
Set up cost table for problem Revise opportunity cost table
optimal
in two steps:
Step 1 (a) Subtract the smallest
number not covered by a line
from itself and every other
Find opportunity cost
uncovered number
(a) Subtract smallest number in
(b) add this number at every
each row from every number
intersection of any two lines
in that row, then
(b) subtract smallest number in
each column from every
number in that column Optimal solution at zero
locations. Systematically make
final assignments.
Step 2
(a) Check each row and column
for a unique zero and make the
Test opportunity cost table to first assignment in that row or
see if optimal assignments are column
possible by drawing the
minimum possible lines on (b) Eliminate that row and
columns and/or rows such that Optimal column and search for another
all zeros are covered unique zero. Make that
assignment and proceed in a
like manner.
 The Hungarian Method
(Floods Technique)

Step 1: Find the opportunity cost table

We can compute row opportunity costs and column
opportunity costs
What we need is the total opportunity cost
We derive this by taking the row opportunity costs and
subtract the smallest number in that column from
each number in that column
 The Hungarian Method
(Floods Technique)
Cost of each person- Row opportunity
project assignment cost table

PROJECT PROJECT
PERSON 1 2 3 PERSON 1 2 3

Adams $11 $14 $6 Adams $5 $8 $0

Brown 8 10 11 Brown 0 2 3

Cooper 9 12 7 Cooper 2 5 0

The opportunity cost of assigning Cooper to

project 2 is $12 $7 = $5
 The Hungarian Method
(Floods Technique)
We derive the total opportunity costs by taking the costs
in Table 29 and subtract the smallest number in each
column from each number in that column

Row deduction Column deduction

PROJECT PROJECT
PERSON 1 2 3 PERSON 1 2 3

Adams $5 $8 $0 Adams $5 $6 $0

Brown 0 2 3 Brown 0 0 3

Cooper 2 5 0 Cooper 2 3 0
 The Hungarian Method
(Floods Technique)
Step 2: Test for the optimal assignment
We want to assign workers to projects in such a way
that the total labor costs are at a minimum
We would like to have a total assigned opportunity
cost of zero
The test to determine if we have reached an optimal
solution is simple
We find the minimum number of straight lines
necessary to cover all the zeros in the table
If the number of lines equals the number of rows or
columns, an optimal solution has been reached
 The Hungarian Method
(Floods Technique)
Test for optimal solution

PROJECT
PERSON 1 2 3

Adams $5 $6 $0

Brown 0 0 3 Covering line 1

Cooper 2 3 0

Covering line 2

This requires only two lines to cover the zeros so

the solution is not optimal
 The Hungarian Method
(Floods Technique)
Step 3: Revise the opportunity-cost table
We subtract the smallest number not covered by a line
from all numbers not covered by a straight line
The same number is added to every number lying at
the intersection of any two lines
We then return to step 2 to test this new table
 The Hungarian Method
(Floods Technique)
Revised opportunity cost table (derived by
subtracting 2 from each cell not covered by a line
and adding 2 to the cell at the intersection of the
lines)
PROJECT
PERSON 1 2 3

Adams $3 $4 $0

Brown 0 0 5

Cooper 0 1 0
 The Hungarian Method
(Floods Technique)
Optimality test on the revised opportunity cost
table
PROJECT
PERSON 1 2 3

Adams $3 $4 $0

Brown 0 0 5 Covering line 2

Cooper 0 1 0

Covering line 1 Covering line 3

This requires three lines to cover the zeros so the

solution is optimal
Making the Final Assignment

The optimal assignment is Adams to project 3, Brown to

project 2, and Cooper to project 1
But this is a simple problem
For larger problems one approach to making the final
assignment is to select a row or column that contains
only one zero
Make the assignment to that cell and rule out its row and
column
Follow this same approach for all the remaining cells
 Making the Final Assignment
Total labor costs of this assignment are

ASSIGNMENT COST ($)

Adams to project 3 6

Brown to project 2 10

Cooper to project 1 9

Total cost 25
 Making the Final Assignment
Making the final assignments

(A) FIRST (B) SECOND (C) THIRD

ASSIGNMENT ASSIGNMENT ASSIGNMENT

1 2 3 1 2 3 1 2 3

Adams 3 4 0 Adams 3 4 0 Adams 3 4 0

Brown 0 0 5 Brown 0 0 5 Brown 0 0 5

Cooper 0 1 0 Cooper 0 1 0 Cooper 0 1 0

Unbalanced Assignment Problems

Often the number of people or objects to be assigned

does not equal the number of tasks or clients or
machines listed in the columns, and the problem is
unbalanced
When this occurs, and there are more rows than
columns, simply add a dummy column or task
If the number of tasks exceeds the number of people
available, we add a dummy row
Since the dummy task or person is nonexistent, we enter
zeros in its row or column as the cost or time estimate
 Unbalanced Assignment Problems
The Fix-It Shop has another worker available
The shop owner still has the same basic problem of
assigning workers to projects
But the problem now needs a dummy column to balance
the four workers and three projects
PROJECT
PERSON 1 2 3 DUMMY
Adams $11 $14 $6 $0
Brown 8 10 11 0
Cooper 9 12 7 0
Davis 10 13 8 0
 Maximization Assignment Problems

Some assignment problems are phrased in terms of

maximizing the payoff, profit, or effectiveness
It is easy to obtain an equivalent minimization problem
by converting all numbers in the table to opportunity
costs
This is brought about by subtracting every number in the
original payoff table from the largest single number in
that table
Transformed entries represent opportunity costs
Once the optimal assignment has been found, the total
payoff is found by adding the original payoffs of those
cells that are in the optimal assignment
 Maximization Assignment Problems

The British navy wishes to assign four ships to patrol four

sectors of the North Sea
Ships are rated for their probable efficiency in each
sector
The commander wants to determine patrol assignments
producing the greatest overall efficiencies
 Maximization Assignment Problems

Efficiencies of British ships in patrol sectors

SECTOR
SHIP A B C D
1 20 60 50 55
2 60 30 80 75
3 80 100 90 80
4 65 80 75 70
 Maximization Assignment Problems

Opportunity cost of British ships

SECTOR
SHIP A B C D
1 80 40 50 45
2 40 70 20 25
3 20 0 10 20
4 35 20 25 30
 Maximization Assignment Problems

First convert the maximization efficiency table into a

minimizing opportunity cost table by subtracting each
rating from 100, the largest rating in the whole table
The smallest number in each row is subtracted from
every number in that row and the smallest number in
each column is subtracted from every number in that
column
The minimum number of lines needed to cover the zeros
in the table is four, so this represents an optimal solution
 Maximization Assignment Problems

The overall efficiency

ASSIGNMENT EFFICIENCY

Ship 1 to sector D 55

Ship 2 to sector C 80

Ship 3 to sector B 100

Ship 4 to sector A 65

Total efficiency 300