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Master of Business Administration MBA Semester II ASSIGNMENT Set 01

Name Registration No. Learning Centre Learning Centre Code Course Subject Semester Module No. Date of Submission Mark Awarded

: : : : : : : : : :

SUNIL KUMAR K. 571012536 Vision Institute, Palakkad, Kerala. 02853 MBA Operations Research II MB 0048 25.09.2011 _________________________________

Directorate of Distance Education Sikkim Manipal University II floor, Syndicate House MANIPAL 576 104

_____________________ Signature of Coordinator

_________________ Signature of Center

___________________ Signature of Evaluator

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Master of Business Administration-MBA Semester II Subject Code: MB0048 Subject Name: Operations Research (4 Credits)
(Book ID: B1301) Assignment Set- 1 (60 Marks) Q.1. Outline the broad features of the Judgment phase and Research phase of the scientific method in OR. Discuss in detail any of these phases.

Answer: In order to overcome the contradictory of setting the arc-suppression coil and symmetry of three-phase voltage in 35 kV mountainous area grid cannot both take into account. It is necessary to make judgment on single-phase-to-ground fault type. In this mountainous area, voltage features of phase respectively in the aforesaid faults have been obtained as well as the differences between them, and judgment method for fault types and corresponding circuit are proposed with the discussion of influence of grounding resistance and arc re-burn time. Simulation result indicates that this judgment method and circuit gives a good performance for the judgment of fault types and besides, there is basically no threat to its judging result from earthling resistance and re-burn time of arc. The proposal of this judgment method and circuit is of great significance in decreasing trip-out rate improving operation level of 35 kV grids in mountainous area. One of the most dangerous assumptions product developers can make is that their users are like them. This assumption is almost always wrong. While it may be obvious that a middleaged product manager in a telecommunications company is not like the teenage users of the companys mobile phone service; it may not be obvious that an electrical engineer developing a millimeter is not like the technicians who use the meter. Although the engineer and technicians have certain things in common, they differ in many crucial ways. Their background and education is different. Their goals are different. The work context is different. And, inevitably, their knowledge of the product is different. The engineer has an intimate understanding of the millimeters specifications, its internal design, and the organizational environment that produced it. Technicians have knowledge on how to use the multi-meter. In some cases this only covers how to complete the specific tasks required in their unique work context, in others it includes a thorough knowledge of the meters user interface, work-around for its limitations and ingenious, novel applications for its use. When you consider that the multi-meter has many types of users with varying backgrounds, goals, tasks, and work environments, you begin to understand the gap between products developers and products users. Closing this gap can make the difference between a modestly successful product and wildly successful one. User research helps to close the gap. User research answers the following questions for actual or prospective users: Users and customers: who are our users? If the user is not the product purchaser, who is? Who are our prospective users and purchaser? User characteristics: What are our users like? What is their age? Sex? Cultural background? Education? Training? Experience? Motivation? Physical limitations or disabilities? User goals, tasks, and models: What do users do with our product and what would they like to do? Are the tasks recreational or professional, easy or complex, variable or
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repetitive, frequent or infrequent, one at a time or multitasked, time critical or flexible, high-risk or low-risk, individual or collaborative? What mental model does the user have for their tasks and tools they use to accomplish them? Physical environment: What is the physical environment like? Noisy? Dusty? Hazardous? Dimly or brightly lit? Open or private office? Interruptions? Type of furnishing? Social environment: What is the social or organizational environment like? Social or professional peers? Work pressure? Organizational goals (explicit and implied)? Organizational structure and roles? Competitive or collaborative? User support: How available and effective is training, documentation, peer support and technical support?

The questions above can be answered with a combination of direct field observation, indirect observation, interviews, and questionnaires. Customers support analysis and competitive analysis also provide useful data from which to develop UX requirements. Direct filed observation. One of the most reliable and effective ways to understand users is to directly observe them in the field, in other words in their work, home, or recreational environment. Field observation solves several problems inherent in other research methods: (1) Users work processes may be so automatic and behaviorally well integrated that they cannot describe them (2) Users environments may be so familiar that they are simply no longer consciously considered; users have learned to accommodate it so well they can no longer describe it. Even when users can describe their work processes and environments, without direct experience researchers may misunderstand their description. Direct observation avoids these pitfalls because it give the researcher direct access to the pertinent information. Field observation techniques are adapted from ethnographic methods used by anthropologists and sociologists that were developed to put those observed at ease. In fact, when implemented properly, field studies have significant PR value because they make users feel valued. Field observation is an excellent method to gather information on the users behavioral and socio-cultural experience that will eventually help define product features and user interface. Indirect observation is the collection of behavioral data without the research being present. Specialized software is available to facilitate indirect observation of user interaction with software, Web sites, and Web applications. Client-side applications can record and aggregate keystrokes, mouse clicks, and page views. Server-side applications record IP addresses of visitors and their mouse clicks (click stream). This information can help researchers understand how users interact with their product; however, because it is difficult to interpret the intent behind the behavior, indirect observation usually must be combined with other methods to be useful. Interviews help researchers understand the motivation behind user actions and are usually done as part of a field observation. Interviews can also be done independently, either face-toface or on the telephone. Although some users may offer design suggestions and ideas during an interview, the purpose of the interview is to help the researcher understand what users need an how they work, not to get them to design the product. Typically, interviews are semistructured, meaning some standard questions are asked, but new areas of inquiry that develop during the interview can also be explored. Special techniques can be used to get maximum value for the interaction; for example, users may be asked to sort names of products written on index cards into categories they feel are related, a method called card sorting. This
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information can be used to design an e-commerce site with products located where users expect them. Specially structured group interviews called focus groups can also be used to collect data and gage reactions to early prototypes. They are particularly useful to evaluate visceral responses and socio-cultural influences. Questionnaires or surveys cannot replace observation because they do not provide behavioral information, nor can they replace interviews because they are missing the rich verbal and nonverbal conversation from which much useful information is gleaned. Questionnaires can, however, collect large amounts of user background information and user-satisfaction data, and therefore are an effective complement to other research methods. Compared to mail or telephone surveys, online questionnaires are very cost effective and can be rapidly deployed. They can also be used to rapidly test visceral responses to Web sites, graphical user interfaces (GUI), and other products. Unfortunately, poorly designed questionnaires provide confusing or misleading data or suffer from poor response rates. Therefore, care must be taken to define questionnaire objectives, word questions effectively, and structure the questionnaire to maximize response rate and simplify statistical analysis. Customer support analysis. Reviewing customer support records for UX issues and interviewing support staff is a cost-effective way to identify UX issues with existing products. For example after usability analysis learned that Lands End Web customers were phoning the contact centre to get advice on what size clothes to buy, they added online measuring charts and instructions, which reduced call volume significantly. Competitive analysis involves an in-depth deconstruction of a competing product in order to find its UX weaknesses so that you can create an attractive and usable alternative. Competitive analysis may include direct field observation, indirect observation, interviews, and UX evaluation methods. Data collected during the user research phase ensures that you are developing a product that meets the needs of real users. With this data in hand, the next step is to define UX requirements. Work products: User, Tasks, and Environment Profiles. Notes taken during field observations and interviews together with indirect observation and questionnaire data are summarized in profiles of the various users, their tasks, and environments. These profiles can be used by product managers to help conceptualize new products or features, by product designers to make sure these features are successfully implemented, and by marketers to help target product marketing efforts. Profiles can take several forms and contain different information, depending on the particular project and design environment. Tasks profiles may take the form of a tasks analysis. This is a detailed description of user goals, tasks, and actions. Goals are what a user wants to accomplish. For example, find a customers phone numbers. Tasks are how they plan to accomplish it, for example, search the database. Actions are the specific steps they need to follow, for example, open the search window, type the customers name in the search box, and press enter. Detailed descriptions of this type can reveal opportunities to improve workflow and they can also accelerate user interface design by providing structure for design decision. User profiles may include a description of user model. A user model is a type of mental model typically only partly conscious that conceptualizes users work and technology. It influences user behavior and considering it during product design makes a product more intuitive to use, facilitating user acceptance.

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Q.2. Operation Research is an aid for the executive in making his decisions by providing him the needed quantitative information, based on scientific method analysis. Discuss.

Answer: Operation Research is a scientific method of providing executive departments with a quantitative basis for decisions regarding the operations under their control. Morse & Kimball Operations research is a scientific approach to problem solving for executive management. H.M. Wagner Operations research is an aid for the executive in making these decisions by providing him with the needed quantitative information based on the scientific method of analysis. The mission of Operations Research is to serve the entire Operations Research (OR) community, including practitioners, researchers, educators, and students. Each issue of Operations Research attempts to provide a balance of well-written articles that span the wide array of creative activities in OR. Thus, the major criteria for acceptance of a paper in Operations Research are that the paper is important to more than a small subset of the OR community, contains important insights, and makes a substantial contribution to the field that will stand the test of time. Operational Research, also known as operations research, is an interdisciplinary branch of applied mathematics and formal science that uses advanced analytical methods such a mathematical modeling, statistical analysis, and mathematical optimization to arrive at optimal or near-optimal solutions to complex decision-making problems. It is often concerned with determining the maximum (of profit, performance, or yield) or minimum (of loss, risk, or cost) of some real-world objective. Originating in military efforts before World War II, its techniques have grown to concern problems in a variety of industries. Operational research, also known as OR, is an interdisciplinary branch of applied mathematics and formal science that uses advanced analytical methods such as mathematical modeling, statistical analysis, and mathematical optimization to arrive at optimal or near-optimal solutions to complex decision-making problems. It is often concerned with determining the maximum (of profit, performance, or yield) or minimum (of loss, risk, or cost) of some real world objective. Originating in military efforts before World War II, its techniques have grown to concern problems in a variety of industries. Operational Research encompasses a wide range of problem-solving techniques and methods applied in the pursuit of improved decision-making and efficiency. Some of the tools used by operational researchers are statistics, optimization, probability theory, queuing theory, game theory, graph theory, decision analysis, mathematical modeling and simulation. Because of the computational nature of these fields, OR also has strong ties to computer science. Operation Research faced with a new problem must determine which of these techniques are most appropriate given the nature of the system, the goals for improvement, and constraints on time and computing power. Work in operational research and management science may be characterized as one of the three categories: Fundamental or foundational work takes place in a three mathematical disciplines: Probability, optimization and dynamical systems theory. Modeling work is concerned with the construction of models, analyzing them mathematically, implementing them on computers, solving them using software tools and assessing their effectiveness with data. This level is mainly instrumental, and driven mainly by statistics and econometrics. Application work in operational research, like other engineering an
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economics disciplines, attempts to use models to make a practical impact on realworld problems. The major sub disciplines in modern operational research, as identified by the journal Operations Research are: Computing and information technologies Decision Analysis Environment, energy, and natural resources Financial engineering Manufacturing, service sciences, and supply chain management Policy modeling and public sector work Revenue management Simulation Stochastic models Transportation.

Q.3. A furniture manufacturer makes two products: chairs and tables. Processing of these products is done on two machines A and B. A chair requires 2 hours on machine A and 6 hours on machine B. A table requires 5 hours on machine A and no time on machine B. There are 16 hours per day available on machine A and 30 hours on machine B. Profit gained by the manufacturer from a chair and a table is Rs 2 and Rs 10, respectively. What should be the daily production of each of the two products?

Answer: Let X be the number of chairs to be manufactured And Y be the number of tables to be manufactured Let Z = Profit earned (Objective function which is to be maximized) Z is to be maximized under the following constraints: Z = 2X+10Y 2X + 5Y <= 16 (Availability constraint of machine A) 6X <=30 (Availability constraint of machine B) X> = 0 Y+=0

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Q.4. Given a general linear programming problem, explain how you would test whether a basic feasible solution is an optimal solution or not. How would you proceed to change the basic feasible solution in case it is not optimal?

Answer: Linear Programming (LP) is a mathematical method for determining a way to achieve the best outcome (such as maximum profit or lowest cost) in a given mathematical model for some list of requirements represented as linear relationships. More formally, linear programming is a technique for the optimization of a linear objective function, subject to linear equality and linear inequality constraints. Given a polytope and a real-valued affine function define on this polytope, a linear programming method will find a point on the polytope where this function has the smallest (or largest) value if such point exists, by searching through the polytope vertices. Linear programs are problems that can be expressed in canonical form: Maximize: Subject to: cTx Ax b

Where x represents the vector of variable (to be determined), c and b are vectors of (known) coefficients and A is a (known) matrix of coefficients. The expression to be maximized or minimized is called the objective function ( c x in this case). The equations Ax b are the constraints which specify a convex polytope over which the objective function is to be optimized. (In this context, two vectors are comparable when every entry in one is less than or equal to the corresponding entry in the other. Otherwise, they are incomparable). Linear programming can be applied to various fields of study. It is used most extensively in business and economics, but can also be utilized for some engineering problems. Industries that use linear programming models include transportation, energy, telecommunications, and manufacturing. It has proved useful in modeling diverse type of problems in planning, routing, scheduling, assignment, and design. Uses: Linear programming is a considerable field of optimization for several reasons. Many practical problems in a operations research can be expressed as linear programming problems. Certain special cases of linear programming, such as network flow problems and multicommodity flow problems are considered important enough to have generated much research on specialized algorithms for their solution. A number of algorithms for other types of optimization problems work by solving LP problems as sub-problems. Historically, ideas from linear programming have inspired many of the central concepts of optimization theory, such as duality, decomposition, and the importance of convexity and its generalizations. Likewise, linear programming is heavily used in microeconomics and company management, such as planning, production, transportation, technology and other issues. Although the modern management issues are ever-changing, most companies would like to maximize profits or minimize costs with limited resources. Therefore, many issues can be characterized as linear programming problems.

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Standard form: Standard form is the usual and most intuitive form of describing a linear programming problem. It consists of the following four parts: i) ii) iii) iv) A Linear function to be maximized Problem constraints of the following form Non-Negative variables Non-negative right hand side constants

Other forms, such as minimization problems, problems with constraints on alternative forms, as well as problems involving negative variables can always be rewritten into an equivalent problem in standard form. Checking the Optimality: In order to see if our basic feasible solution is optimal, we need to be able to express our cost in terms of the non basic variables. If xij lies in our basis, the problem of putting the equations into basic form is equivalent to adding multiples of equations containing xij to the final cost equation to make the coefficient of xij equal zero in this equation. But the only two equations containing xij will be the ith supply constraint and the jth demand constraint. Suppose we need to add ui x the ith supply constraint, vj x the jth demand constraint. Then the coefficient of xij in the cost equation is now ui + jv cij = 0. We have a similar equation for all the xij in the basis. Also the coefficients of the non basic variables are now ui + vj cij, in general these will not be zero. We set the coefficients of the basis variables to zero in the cost equation which gives the equations ui + vj = cij where the set {i, j} represents the set of basis variables. In general we get (n +m) unknowns but only (n + m 1) equations, so we are free to set one of the variables equal to zero. After computing the values of these variables, we an calculate the coefficients of the non basic variable in the cost equation, ui + vj cij. If any of the ui + vj cij > 0, we can decrease the total cost by choosing the largest positive coefficient to be brought into the basis. We will now check for optimality on our original example, after using the Minimum cost method to find a basic feasible solution we have. This implies we have the following equations: u1 + v1 = 8, u2 + v1 = 9, u2 + v2 = 12, u2 + v3 = 13, u3 + v2 = 9, u3 + v4 = 5 taking u1 = 0 | v1 = 8, v2 = 11, v3 x 12, v4 = 7, u2 = 1, u3 = -2. Here it can be seen that 5 corresponding to (u1, v2) is the largest positive coefficient, and so we wish to bring (u1, v2) into the basis. The Theta Method: The theta method allows us to change the basis without working with the full basic equations. If we want to bring (ui, vj) in as a basis variable with the (at present undermined) value q, we modify our table au to take account of this change, but also to maintain the constraint on each row and column sum.

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Q.5. State and discuss the methods for solving an assignment problem. How is Hungarian method better than other methods for solving an assignment problem?

Answer: The assignment problem can be stated as a problem where different jobs are to be assigned to different machines on the basis of the cost of doing these jobs. The objective is to minimize the total cost of doing all the jobs on different machines. The peculiarity of the assignment problem is only one job can be assigned to one machine i.e. it should be a one-to-one assignment. The cost data is given as a matrix where rows correspond to jobs and columns to machines and there are as many rows as the number of columns i.e. the number of jobs and number of Machines should be equal. This can be compared to demand equals supply condition in a balanced transportation problem. In the optimal solution there should be only one assignment in each row and columns of the given assignment table. One can observe various situations where assignment problem can exist e.g. assignment of workers to jobs like assigning clerks to different counters in a bank or salesman to different areas for sales, different contracts to bidders. Assignment becomes problem because each job requires different skills and the capacity or efficiency of each person with respect to these jobs can be different. This gives rise to cost differences. If each person is able to do all jobs equally efficiently then all costs will be the same and each job can be assigned to any person. When assignment is a problem it becomes a typical optimization problem it can therefore be compared to a transportation problem. The cost elements are given and is a square matrix and requirement at each destination is one and availability at each origin is also one. In addition we have number of origins which equals the number of destinations hence the total demand equals total supply. There is only one assignment in each row and each column. However, if we compare this to a transportation problem we find that a general transportation problem does not have the above mentioned limitation. These limitations are peculiar to assignment problem only. Steps to solve the minimization case for an assignment problem: Step 1: Determine the opportunity cost table: Locate the smallest cost in each row and subtract it from each cost figure in that row. This would result in at least one zero in each row. The new table is called reduced cost table. Locate the lowest cost in each column of the reduced cost table subtract this figure from each cost figure in that column. This would result in at least one zero in each row and each column, in the second reduced cost table. To make an optimal assignment in a say 3 x 3 table. We should be in a position to locate 3 zeros in the table. Such that 3 jobs are assigned to 3 persons and the total opportunity cost is zero. A very convenient way to determine such an optimal assignment is as follows: Draw minimum number of straight lines vertical and horizontal, to cover all the zero elements in the second reduced cost table. One cannot draw a diagonal straight line.
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Step 2: Determine the possibility of an optimal assignment:

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The aim is that the number of line (N) to cover all the zero elements should be minimum. If the number of line is equal to the number of rows (or columns) (n) i.e. N=n it is possible to find optimal assignment. Example: for a 3 x 3 assignment table we need 3 straight lines which cover all the zero elements in the second reduced cost table. If the number of lines is less than the number of rows (columns) N < n optimum assignment cannot be made. Select the smallest number in the table which is not covered by the lines. Subtract this number from all uncovered numbers as well as from itself. Add this number to the element which is at the intersection of any vertical and horizontal lines Draw minimum number of lines to cover all the zeros in the revised opportunity cost table. If the number of straight lines at least equals number of rows (columns) an optimum assignment is possible.

Step 3: Modify the second reduced cost table:

Step 4: Make the optimum assignment: If the assignment table is small in size it is easy to make assignment after step 3. However, in case of large tables it is necessary to make the assignments systematically. So that the total cost is minimum. To decide optimum allocation: Select a row or column in which there is only one zero element and encircle it. Assign the job corresponding to the zero element i.e. assign the job to the circle with zero element. Mark a X in the cells of all other zeros lying in the column (row) of the encircled zero. So that these zeros cannot be considered for next assignment. Again select a row with one zero element from the remaining rows or columns. Make the next assignment continue in this manner for all the rows. Repeat the process till all the assignments are made i.e. no unmarked zero is left. Now we will have one encircled zero in each row and each column of the cost matrix. The assignment made in this manner is Optimal. 1) Enumeration Method 2) Simplex Method 3) Transportation Problem 4) Hungarian Method Hungarian Method: Hungarian method is based on the concept of opportunity cost and is more efficient in solving assignment problems. Adopt the following steps mentioned below to solve an AP using the Hungarian method algorithm: Step 1: Prepare row ruled matrix by selecting the minimum values for each row and subtract it from other elements of the row.
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We can solve an assignment problem by any of the following four methods:

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Step 2: Prepare column reduced matrix by subtracting minimum value of the column from the other values of that column. Step 3: Assign zero row-wise if there is only one zero in the row and cross (cancel) (X) other zeros in that column. Step 4: Assign column wise if there is only one zero in that column and cross other zeros in that row. Step 5: Repeat steps 3 and 4 till all zeros are either assigned or crossed. If the number of assignments in equal to number of rows present, you have arrived at an optimal solution, if not, then proceed to step 6. Step 6: Mark () the unassigned rows. Look for crossed zero in that row. Mark the column containing the crossed zero. Look for assigned zero in that column. Mark the row containing assigned zero. Repeat this process till all makings are over. Step 7: Draw straight line through unmarked rows and marked column. The number of straight line drawn will be equal to number of assignments made. Step 8: Examine the uncovered elements. Select the minimum. Subtract it from uncovered elements Add it at the point of intersection of lines Leave the rest as it is Prepare a new table

Step 9: Repeat steps 3 to 7 till optimum assignment is obtained. Step 10: Repeat steps 5 to 7 till number of allocations = number of rows.
Q.6. Compare and contrast CPM and PERT. Under what conditions would you recommend scheduling by PERT? Justify your answer with reasons.

Answer: Project management has evolved as a new field with the development of two analytic techniques for planning scheduling and controlling of projects. These are the critical path method (CPM) and the project evaluation and review technique (PERT). PERT and CPM are basically time anointed methods in the sense that they both lead to determination of a time schedule. Both techniques are usually referred as Project scheduling techniques. Though there are no essential differences between PERT and CPM as both of them share in common the determination of a critical path. Both are based on the network representation of activities and their scheduling that determines the most critical activities to be controlled so as to meet the completion date of the project.
1. CPM is activity oriented i.e. CPM network is built on the basis of activities. Also result of carious calculation are considered in terms of activities of the project. On the other hand, PERT is event oriented.

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2. CPM is a deterministic model i.e. it dose not take into account the uncertainties involved in the estimation of time for execution of a job or an activity. It completely ignores the probabilistic element of the problem. PERT however is a probabilistic Model. It uses three estimates of the activity time- optimistic, pessimistic and most likely with a view to take into account time uncertainty. This is the expected duration of each activity is probabilistic indicates that there is fifty percent probability of getting the job done within the time.
3.CPM place dual emphasis on time and cost and evaluate the trade off between project cost and

project time. By deploying allows the project manager to manipulate project duration within certain limits so that project duration can be shortened to an optimal cost. On the other hand: PERT is primarily concerned with time. It helps the manager to schedule and co-ordinate various activities so that the project can be completed on schedule time.

Extensions of both PERT and CPM allow the user to manage other resources in addition to time and money, to trade off resources, to analyze different types of schedules, and to balance the user of resources, tensions of both PERT and CPM allow the user to manage other resources in addition to time and money, to trade off resources, to analyze different types of schedules and to balance the user of resources. Using PERT for Schedule Estimation: Estimation is not any easy task, especially for complex enterprise software solutions. We seldom have sufficient information to understand completely the scope of the project the interface (oh, you expected these to be documented?), volumes of data (you expected the data to be complete and accurate?), the amount of business process reengineering (yes, we think there may be a few processes to change, but nothing major), and on and on. Yet, the delivery team is expected to be able to take these types of ambiguous descriptions of requirements and miraculously come up with an estimate within 0.5 percent accuracy. Usually the budget gets based on some initial SWAG and then everyone expresses disbelief that the project manager predicts cost and schedule overruns as more information becomes available. A powerful technique for estimating tasks where there may not be sufficient information is the Program Evaluation Review Technique (PERT). Using the PERT approach for determining the project schedule enables the project manager to provide much more information by taking into account poorly defined areas, probabilities, and ranges for the schedule (versus single point estimates). PERT Estimation PERT allows the estimator to include three estimates: Optimistic, Pessimistic, and most likely, given by the equation: Expected Duration = P + 4 (ML) + O 6 where P is the pessimistic estimate that is predicted to be achievable a high percentage of the time, ML is the most likely estimate, and O is the optimistic estimate that happens a low percentage of the time. (Different sources use different percentage, ranging from 90 to 99 percent for pessimistic and 1 to 10 percent for optimistic). This simple technique, which is easily supported by project management tools or a spreadsheet, enables the project team to provide ranges for the schedule estimates, probabilities and confidence levels.
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