Goal Programming

Multiple-Objectives Problem: In most practical cases, decision

makers are faced a situation where they must achieve more
than two objectives (those may even be in conflict) at same
time.
Or more than two criteria must be used to evaluate a decision.

Examples:
Production Planning - Maximize Profit/Maximize Market
Share
Location Selection - Maximize Sales/Minimize Delivery Cost
Personal Schedule - Maximize GPA/Maximize Income
 Formulation of GP Problems
Deviations: the amount away from the desired standards or objectives:
– Overachievement (d+i ≥ 0) vs. Underachievement (d-i ≥ 0)

– Desirable vs. Undesirable Deviations: (depend on the objectives)

• Max goals (≥) - the more the better - d+i desirable.
• Min goals (≤) - the less the better - d-i desirable.
• Exact goals (=) - exactly equal - both d+i and d-i undesirable

– In GP, the objective is to minimize the (weighted) sum of

undesirable deviations (all undesirable d+i and d-i →→ 0 ).

– For each goal, at least, one of d+i and d-i must be equal to "0"
 Formulation of GP Problems

• Goals are prioritized in some sense, and their level of aspiration

is stated.

• An optimal solution is attained when all the goals are reached as

close as possible to their aspiration level, while satisfying a set
of constraints.

• There are two types of goal programming models:

– Nonpreemptive goal programming - no goal is pre-determined to
dominate any other goal.
– Preemptive goal programming - goals are assigned different priority
levels. Level 1 goal dominates level 2 goal, and so on.
 Goal Programming – Example
Problem
You work for an Advertising agency. A customer has identified
three primary target audiences they are trying to reach, and has an
Advertising budget of $600,000. They have expressed their targets
in the form of three goals:

Goal 1 – Ads should be seen by at least 40 million high-income men (HIM)

Goal 2 – Ads should be seen by at least 60 million low-income people (LIP)
Goal 3 – Ads should be seen by at least 35 million high-income women (HIW)

You recognize that advertising during football games and soap operas will
cover the target audience. The table below indicates the number of viewers
from the different categories that will be viewing these types of programming.

HIM LIP HIW Cost

Football ad (per min.) 7 million 10 million 5 million $100,000
Soap Opera ad (/min) 3 million 5 million 4 million $60,000
Goal Programming – Example
Problem
Expressing the goals as an equation.

Let: x1 – minutes of football ad

x2 – minutes of soap opera ad

Goal 1 - HIM) 7 x1 + 3 x2 > 40

Goal 2 - LIP) 10 x1 + 5 x2 > 60
Goal 3 - HIW) 5 x1 + 4 x2 > 35

Ad Budget) 100 x1 + 60 x2 < 600

 Goal Programming – Example
Problem
Formulating the problem as an LP:
Graphing the feasible region
Min (or Max) Z = something
s.t.
HIM) 7 x1 + 3 x2 > 40
LIP) 10 x1 + 5 x2 > 60
HIW) 5 x1 + 4 x2 > 35
Ad Bud.) 100 x1 + 60 x2 < 600
x1 , x2 > 0

Which constraints are real constraints versus “desired” constraints?

Which constraints are “hard” constraints versus “soft” constraints?
 Goal Programming – Example
Problem
Since the first three constraints are really goals, and not “hard”
constraints, express these constraints in terms of deviational
variables.

HIM) 7 x1 + 3 x2 + d1- - d1+ = 40

LIP) 10 x1 + 5 x2 + d2- - d2+ = 60
HIW) 5 x1 + 4 x2 + d3- - d3+ = 35

d1- , d1+ , d2- , d2+ , d3- , d3+ > 0

Suppose each shortfall 0f 1,000,000 viewers from the goal

translates to a cost of $200,000 for HIM, $100,000 for LIP
and $50,000 for HIW. Then the objective function would be:

Min Z = 200 d1- + 100 d2- + 50 d3-

 Goal Programming – Example
Problem
Then in order to minimize the penalty for not reaching the
viewing audience goal can be expressed as the following LP:

Min Z = 200 d1- + 100 d2- + 50 d3-

s.t.
HIM) 7 x1 + 3 x2 + d1- - d1+ = 40
LIP) 10 x1 + 5 x2 + d2- - d2+ = 60
HIW) 5 x1 + 4 x2 + d3- - d3+ = 35
Ad Bud.) 100 x1 + 60 x2 < 600

x1, x2, d1- , d1+ , d2- , d2+ , d3- , d3+ > 0

The optimal solution to the above LP is:

Z = 250, x1 = 6, x2 = 0, d1+ = 0 , d1- = 0 , d2+ = 0, d2- = 0 ,
d3+ = 0 , d3- = 5.
 Goal Programming: Weighted -vs-
Preemptive Goals

In the advertising example, the goals could readily be weighted

by relative importance using the cost penalties ($200,000 for
HIM, $100,000 for LIP and $50,000 for HIW).

In many cases, the relative “weighting” of a goal is not easily

determined, however the goals can be ranked from most
important to least important. In this case, the most important
goal pre-empts all the other goals. Once the most important
goal is met, the second goal is addressed, and so on.
 Goal Programming: Preemptive
Goals
Suppose the HIM constraint must be met first, followed by
LIP and then HIW.
First rewrite the LP as the following:
Min Z = d1-
s.t.
HIM) 7 x1 + 3 x2 + d1- - d1+ = 40
LIP) 10 x1 + 5 x2 + d2- - d2+ = 60
HIW) 5 x1 + 4 x2 + d3- - d3+ = 35
Ad Bud.) 100 x1 + 60 x2 < 600

x1, x2, d1- , d1+ , d2- , d2+ , d3- , d3+ > 0

This LP solves to Z = 0, d1- = 0. So goal HIM is met.

 Goal Programming: Preemptive
Goals
Since goal HIM is met, now make goal HIM a fixed
constraint while trying to satisfy goal LIP.
Min Z = d2-
s.t.
HIM) 7 x1 + 3 x2 + d1- - d1+ = 40
LIP) 10 x1 + 5 x2 + d2- - d2+ = 60
HIW) 5 x1 + 4 x2 + d3- - d3+ = 35
Ad Bud.) 100 x1 + 60 x2 < 600
d1- =0

x1, x2, d1- , d1+ , d2- , d2+ , d3- , d3+ > 0

This LP solves to Z = 0, d2- = 0. So goal LIP is met.

 Goal Programming: Preemptive
Goals
Since both goal HIM and LIP are met, make goal HIM and
LIP fixed constraints while trying to satisfy goal HIW.
Min Z = d3-
s.t.
HIM) 7 x1 + 3 x2 + d1- - d1+ = 40
LIP) 10 x1 + 5 x2 + d2- - d2+ = 60
HIW) 5 x1 + 4 x2 + d3- - d3+ = 35
Ad Bud.) 100 x1 + 60 x2 < 600
d1- = 0
d2- = 0

x1, x2, d1- , d1+ , d2- , d2+ , d3- , d3+ > 0

 Goal Programming: Additional
Example
A company has two machines for manufacturing a product.
Machine 1 make two units per hour, while machine 2 makes
three units per hour. The company has an order of 80 units.
Energy restrictions dictate that only one machine can operate
at one time. The company has 40 hours of regular machining
time, but overtime is available. It costs $4.00 to run machine
1 for one hour, while machine 2 costs $5.00 per hour. The
company has the following goals:
1) Meet the demand of 80 units exactly.
2) Limit machine overtime to 10 hours.
3) Use the 40 hours of normal machining time.
4) Minimize costs.
 Goal Programming: Preemptive
Goals
Letting Pi represent the relative weighting of each goal, the
example can be formulated as the following LP:
Min Z = P1(d1- + d1+) + P2 d3+ + P3(d2- + d2+) +P4d4+
s.t.
2 x1 + 3 x2 + d1- - d1+ = 80
- +
x1 + x2 + d2 - d2 = 40
d2+ + d3- - d3+ = 10
4 x1 + 5 x2 + d4- - d4+ = 0

x1, x2, d1- , d1+ , d2- , d2+ , d3- , d3+ , d4- , d4+ > 0
NONPREEMPTIVE GOAL PROGRAMMING
An Advertisement Example
• A company is considering three forms of advertising.
Cost per Ad Customers
Television 3000 1000
Radio 800 500
• Goals Newspaper 250 200

– Goal 1: Spend no more $25,000 on advertising.

– Goal 2: Reach at least 30,000 new potential customers.
– Goal 3: Run at least 10 television spots.
 An Advertisement Example

LP Model:

3000X1 + 800X2 + 250X3  25,000

1000X1 + 500X2 + 200X3  30,000
X1  10
 An Advertisement Example

• Detrimental variables
Ui = the amount by which the left hand side falls short
of (under) its right hand side value.
Ei = the amount by which the left hand side exceeds its
right hand side value.
• The goal equations
3000X1 + 800X2 + 250X3 + U1 – E1 = 25,000
1000X1 + 500X2 + 200X3 + U2 – E2 = 30,000
X1 + U3 – E3 = 10
 An Advertisement Example

• The objective is to minimize the penalty of not meeting the

goals, represented by the detrimental variables

E1 U2 U3

 25,000  30,000  10
 An Advertisement Example

• The penalties are estimated to be as follows:

– Each extra dollar spent on advertisement above $25,000

cost the company $1.

– There is a loss of $5 to the company for each customer not

being reached, below the goal of 30,000.
– Each television spot below 10 is worth 100 times each
dollar over budget.
 An Advertisement Example –
The goal programming model
• It is assumed that no advantage is gained by overachieving a
goal.

Minimize 1E1 + 5U2 + 100U3

s.t.
3000X1 + 800X2 + 250X3 + U1 – E1 = 25,000
1000X1 + 500X2 + 200X3 + U2 – E2 = 30,000
X1 + U3 – E3 = 10
All variables are non-negative.
 NONPREEMPTIVE GOAL PROGRAMMING
Conceptual Products

Conceptual Products is a computer company that produces the

CP400 and the CP500 computers. The computers use different
mother boards produced in abundant supply by the company, but use
the same cases and disk drives. The CP400 models use two floppy
disk drives and no zip disk drives whereas the CP500 models use one
floppy disk drive and one zip disk drive. The disk drives and cases
are bought from vendors. There are 1000 floppy disk drives, 500 zip
disk drives, and 600 cases available to Conceptual Products on a
weekly basis. It takes one hour to manufacture a CP400 and its profit
is $200 and it takes one and one-half hours to manufacture a CP500
and its profit is $500.
Goals:
• Goal 1: Produce at least 200 CP400 computers
each week.
• Goal 2: Produce at least 500 total computers
each week.
• Goal 3: Reach at least $250 (in thousands) on
profit.
• Goal 4: Consume no more than 400 total man-
hours each week.
NONPREEMPTIVE GOAL PROGRAMMING
Conceptual Products
NONPREEMPTIVE GOAL PROGRAMMING
Conceptual Products
NONPREEMPTIVE GOAL PROGRAMMING
Conceptual Products
NONPREEMPTIVE GOAL PROGRAMMING
Conceptual Products