Another operations management technique widely used in the business world in linear programming. What is linear programming? Linear programming is a commonly used mathematical technique designed to help operations managers plan and make the decisions necessary to allocate resources (Quantitative Module B: Linear Programming). In addition, Linear Programming (“LP”) is one of the few operations management techniques that will guarantee an optimal answer, providing that all of the assumptions are met. The concept behind a linear programming problem consists of four basic components: (i) decision variables which represent quantities to be determined, (ii) objective function which represents how the decision variables affect the cost or value
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A company’s resources can include labor, time, machinery, money, and raw materials. These resources may be used to produce products or services for consumers. A few examples of ways that organization’s use LP to allocate resources are as follows: (i) scheduling school buses to minimize the total distance traveled when carrying students, (ii) allocating police patrol units to high crime areas to minimize response time to 911 calls, (iii) scheduling bank tellers in order to meet consumer needs while minimizing labor cost, (iv) selecting the optimal product mix in a factory to make the best use of machine and labor hours available while maximizing the organization’s profit, (v) picking mixes of raw materials in feed mills to produce finished feed combinations while remaining cost effective, (vi) determining the distribution system that will minimize shipping cost from multiple warehouses to various distributors, (vii) developing a production schedule that will meet future demands for an organization’s product while simultaneously minimizing production and inventory costs, and (viii) allocating space for a tenants in a new shopping center in order to maximize the leasing company’s revenues (Quantitative Module B: Linear Programming). As noted above, Linear Programming can be used in a wide spectrum of professions while conducting daily …show more content…
These situations include decision making in areas such as marketing and product mix decisions, production scheduling, financial decision making, resource blending, and workforce assignment(Management Science), quality control and purchasing decisions, physical distribution and warehousing decisions, production and long range planning, and exploration of oil deposits. In addition, this optimization technique is used in everyday resource allocations, especially in companies that deal with logistics. LP has powerful capabilities that enable businesses to reduce costs, use resources effectively, reduce risks, improve profitability, and provide benefits in various other key dimensions. In addition, it can automate the decision making processes to improve speed of responses and allow managers to focus their attention on critical uncertainties rather than routine matters (Linear
A company’s resources can include labor, time, machinery, money, and raw materials. These resources may be used to produce products or services for consumers. A few examples of ways that organization’s use LP to allocate resources are as follows: (i) scheduling school buses to minimize the total distance traveled when carrying students, (ii) allocating police patrol units to high crime areas to minimize response time to 911 calls, (iii) scheduling bank tellers in order to meet consumer needs while minimizing labor cost, (iv) selecting the optimal product mix in a factory to make the best use of machine and labor hours available while maximizing the organization’s profit, (v) picking mixes of raw materials in feed mills to produce finished feed combinations while remaining cost effective, (vi) determining the distribution system that will minimize shipping cost from multiple warehouses to various distributors, (vii) developing a production schedule that will meet future demands for an organization’s product while simultaneously minimizing production and inventory costs, and (viii) allocating space for a tenants in a new shopping center in order to maximize the leasing company’s revenues (Quantitative Module B: Linear Programming). As noted above, Linear Programming can be used in a wide spectrum of professions while conducting daily …show more content…
These situations include decision making in areas such as marketing and product mix decisions, production scheduling, financial decision making, resource blending, and workforce assignment(Management Science), quality control and purchasing decisions, physical distribution and warehousing decisions, production and long range planning, and exploration of oil deposits. In addition, this optimization technique is used in everyday resource allocations, especially in companies that deal with logistics. LP has powerful capabilities that enable businesses to reduce costs, use resources effectively, reduce risks, improve profitability, and provide benefits in various other key dimensions. In addition, it can automate the decision making processes to improve speed of responses and allow managers to focus their attention on critical uncertainties rather than routine matters (Linear