University of Wales
Management Development Institute of Singapore (MDIS)
Subject : Project Management and Operational Research
Type of assignment : Individual Assignment
Lecturer : Siew Ngung Chia
Course : Master of Science in Management
Assignment Cover Sheet
Number Name of Student ID Number Signature
1 Musamukhamedov Farrukh M1100082
Submitted on Due Date? NO (Date Submitted: 19/03/2012)
Words Limit Observed? No
Chapter 1. BACKGROUND
The Case Summary 3
Chapter 2. ANALYSIS OF CASE
2.1. Setting up the model 5
2.2. Solution from Management Scientist 6
Interpretation and Explanation of ...view middle of the document...
Table 1. Current constraints and resources.
Trucking capacity at least 36 tons
Manpower max 48 workers
Trucking facilities available max 40
The paper analizes and gives optimal solutions for the investment based on the current situation. Moreover, discusses the adventages and disadvantages of the following listed alternative options of purchasing:
only one type of truck (pickup or vans)
same number of each type of truck (50% pickup trucks and 50% vans)
minimum total number of trucks
Bay City Movers problem can easily be analyzed using mathematical model which presents the core of the problem. Mathematical model is very convenient tool to reformulate the problem. It has many advantages over a verbal description of the problem. A major advantage of a mathematical model is its ability to describe a problem more briefly. This makes the overall structure of the problem more logical and helps to tell important cause-and-effect relationships. In this way, it indicates more clearly what additional data are relevant to the analysis. Finally a mathematical model forms a bridge to the use of high-powered mathematical techniques and computers to analyze the problem.
For the purpose of this report, we have chosen one of the most widely used model, known as linear programming model. According to Thomas Ferguson a linear programming is defined as the problem of maximizing or minimizing a linear function subject to constraints. In other words linear programming is the process of finding the “best” value obtainable under various linear inequalities related to some conditions. A typical example related to Bay City Movers would be taking the limitations of facility available for trucks and labor, and then determining the minimum investment for the “best” trucking capacity under those conditions.
Linear programming tool should not be considered as a perfect tool of modeling. It has some limitations that should be considered while considering specific condition in real life applications of project management. Here are limitations listed by Denis Lock (2003):
Linearity of relations: A primary requirement of linear programming is that the objective function and every constraint must be linear. However in real life situations, several business and industrial problems are nonlinear in nature.
Single objective: Linear programming takes into account a single objective only, i.e., profit maximization or cost minimization. However, in today’s dynamic business environment, there is no single universal objective for all organizations.
Certainty: Linear programming assumes that the value of co-efficient of decision variables are known with certainty. Due to this restrictive assumption, linear programming cannot be applied to a wide variety of problems where values of the coefficients are probabilistic.
Constant parameters: Parameters appearing in LP are assumed to be constant, but in practical situation it is not so.