Topic 1

Tutorials
1.1 Consider the supply chain for an automobile. Draw a simplified scheme of the supply chain for 4 levels
of facilities (max 4 players for each level), including the flow of goods and the flow of information. State
players, their objectives, costs, constraints, possibility to model for optimisation and simulation. Give
examples of conflicting goals between the supply chain as a whole and each level of firms involved the
type of information available and needed for the optimisation of the whole supply chain.

1.2 What are the implications of using inaccurate models and data in supply chain decisions?

1.3 For the company you work for, or a company you know well, try to:
a. State a logistics-related problem that might be worth solving;
b. Analyse the SC structures over an echelon or more, as required;
c. State goals of each major player in the SC;
d. Highlight conflicting goals between players of the SC if any;
e. Suggestions to improve/optimise SCs operation;
f. Highlight potential difficulties in optimisation;
g. Highlight potential benefits in implementing the optimisation;
h. Highlight potential resistance to implementation and reasons;
i. Balance expenditures, benefits, potential resistance to implementation, and likelihood of success to
implement solution;
j. Propose a strategy and tool/s to solve/optimise the problem.

1.4 In this exercise you need to form a group with four members in order to play different roles associated
with the beer game. Please visit the website: http://davinci.tamu.edu/beergame/v1/index.htm and study
the player manual (http://davinci.tamu.edu/beergame/v1/Player%20Manual%20for%20Beergame.pdf)
carefully before playing the game. Your password for each role within the game will be given in the
course website: http://learn.unisa.edu.au/course/view.php?id=34685. After playing the game for four
times, you should make a short report about the results you got through those four games. In the report,
you should include all the reports generated from the game website, analyse the data and explain why
the so-called Bullwhip effect happened. You need to suggest the way to address the bullwhip effect.
(You will also be asked to explain how you played the game and discuss the causes of bullwhip effect.)

2

Topic 2

Tutorials
For the following problems, formulate the model then solve them with Solver in Excel. Data files are
available on the course web-site

Problem 2.1



Problem 2.2
An advertising company wants to determine how to obtain the most audience exposure from its current
advertising budget. The four media available are TV, Radio, Magazines and Newspapers.

TV Radio Magazines Newspapers
Cost/advertising
unit ($)
60,000 25,000 20,000 12,000
No of male
customers
reached/unit
200,000 110,000 80,000 50,000
No of female
customers
reached/unit
150,000 120,000 85,000 70,000

The company doesnt want to spend more than $700,000 on advertising.
Other requirements are:
a. At least 1,800,000 males must be reached;
b. At least 1,500,000 females must be reached;
c. At least 4 units must be bought on TV;
d. No more than 10 units must be bought in magazines; the number of units on radio and newspapers must
each be between 2 and 15.

Develop the LP model.





3


Problem 2.3





Problem 2.4





Problem 2.5








4

Problem 2.6





Problem 2.7



Problem 2.8





Problem 2.9


5

Problem 2.10



Problem 2.11




Problem 2.12







6

Problem 2.13




Problem 2.14



Problem 2.15


7

Problem 2.16



Problem 2.17




Problem 2.18




Problem 2.19



8

Problem 2.20



Problem 2.21

9

Topic 3

Tutorials
For the following problems, formulate the model (MIP) then solve them with Solver.

Problem 3.1
The local scout group in a fund raising drive has decided to set up a soft drink stall outside the scout hall.
They feel that they should only offer two types of soft drinks for sale cherry fizz and lemon pop.
Each of cherry fizz and lemon pop consists of two ingredients, A and B.
To make a batch of cherry fizz requires 5 litres of A and 5 litres of B.
A batch of lemon pop requires 3 litres of A and 11 litres of B.
The scouts have 30 litres of A and 55 litres of B available.
The scout leader has decided that no more than four batches of lemon pop should be made.
The scouts make a profit of $3 on each batch of cherry fizz and $4 on each batch of lemon pop.
Determine how many batches of each type should they make so as to maximise their profit?

Problem 3.2
A small wine-tasting company with 5 employees has received contracts to test 3 wines. One employee is
required for the testing of each wine (tasks A, B and C). In addition, one employee is required for report
writing (D) and one for administrative duties (E). Each employee is able to perform any of the five tasks
with a relative efficiency, as specified in the table below. The larger the number, the more efficient the
employee is at the given job.
task/employee 1 2 3 4 5
A 5 7 3 6 2
B 6 3 5 5 5
C 1 2 3 2 3
D 4 6 7 5 4
E 3 4 3 4 4

a. Develop the model for the assignment problem, so as to maximise efficiency, considering each employee
has to carry out a single task and all tasks are to be assigned.
b. Consider an employee is assigned to 2 tasks every day (safety and well-being reasons). Reformulate the
model for this case, to assign employees to tasks so as to maximise efficiency.

Problem 3.3
An ice cream parlour manufactures and sells four flavours of ice cream, namely, chocolate, vanilla,
strawberry and coconut. The basic ingredients for the ice cream are milk, sugar and cream, of which there
are maximum amounts of 1 200 litres, 400 kg and 380 litres available, respectively, per week. The profit per
litre on each flavour is 42 cents for chocolate, 37 cents for vanilla, 50 cents for strawberry and 48 cents for
coconut. The parlour has also decided that it should make at least as many litres of vanilla as strawberry, and
that the amount of coconut made should not be less than 20% of the total ice cream made.
The ingredients requirements for each flavour are shown below.
Usage per litre
Flavour milk (L) sugar (kg) cream (L)
10

Chocolate 0-35 0-45 0-25
Vanilla 0-50 0-30 0-20
Strawberry 0-45 0-15 0-40
Coconut 0-60 0-20 0-20
The ice cream parlour would like to determine how many litres of each flavour to make each week in order
to maximise profit (assume that it can sell all the ice cream that it makes).
a. Formulate the problem as one in linear programming.
b. Reformulate the problem so that only multiple of 10 litres of ice cream can be made.


Problem 3.4



Problem 3.5



Problem 3.6


11

Problem 3.7


Problem 3.8


Problem 3.9

Problem 3.10


12


Problem 3.11


Problem 3.12


Problem 3.13



Problem 3.14



Problem 3.15



13

Problem 3.16



Problem 3.17


Problem 3.18


14

Problem 3.19



Problem 3.20


Problem 3.21


Problem 3.22

15

Topic 4


Tutorials
4.1 Consider the following map:
0 1 2 3 4 5 6 7 8 9 10 11 12
1 9
2 10 13 12
3
4 1
5 8 13
6 4
7 2
8 11 7
9
10
11 3 5
12 6

1. Develop two simple heuristics to visit all highlighted squares (Travelling salesperson) travelling the
minimal distance: moving one cell = 1 unit. You can only travel horizontally and vertically
(Manhattan distance).
2. Determine the optimal distance applying the developed heuristic (3 attempts for each heuristic).

4.2 Consider the following map:
0 1 2 3 4 5 6 7 8 9 10 11 12
1 16 9
2 10 14 12
3 15
4 1
5 8 13
6 4 20
7 2
8 11 7
9 17 19
10 18
11 3 5
12 6

1. Develop two simple heuristics to visit all highlighted squares (Travelling salesperson) travelling the
minimal distance: moving one cell = 1 unit. You can only travel horizontally and vertically
(Manhattan distance).
16

2. Determine the optimal distance applying the developed heuristic (3 attempts for each heuristic).

4.3 The following map represents a plan of a production workshop.
An AGV is in point x (C, 12) and has to deliver parts to a lathe L, two mills M and one grinder G.
The AGV can only travel N-S and E-W.
The AGV uses a blind approach to find its way i.e. it can only sense if it is going to bump frontally into
a machine this is the point when the parts can be delivered to that machine.
Develop two different heuristics to deliver the parts to the machines. Each square travelled costs one
unit.
Compare and contrast the two heuristics.

A B C D E F G H I J J L
1
2 M L
3 L
4
5
6 G
7 M
8
9
10 L
11 G
12 X


4.4 Consider the Local delivery problem:

Delivery of chemicals, from the depot to the customers:
- 10 tons trucks available number not limited;
- max 80 miles between customers;
- truck capacity and distance cannot be violated;
- cost: 120$ per truck to put on the road and $1/mile travelled;
- max 300 miles travel per truck per day;


a. Develop two heuristics to serve all customers while minimising costs;

b. Apply the heuristics to obtain a feasible delivery schedule

c. Compare and contrast the two heuristics

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18



Topic 5


Tutorials
5.1. Consider the supply chain for an automobile as in Problem 1.1. Consider you have to prepare your
problem for the simulation of that supply chain. State resources, loads, queues, activities and delays, etc,
connections and relation between them, uncertainties, and their formulation. (Give a conceptual
structure, not a detailed one, but comprehensive enough to take into account all important elements -
max 3 pages)
5.2. Consider an automobile factory. Give three logistics-related examples where simulation can be used to
detect bottlenecks.
5.3. Consider a distribution centre for a major supermarket chain. Give three realistic, logistics-related
examples where simulation can be used to make correct choices.
5.4. Consider a warehouse in a manufacturing facility. Give three logistics-related examples where
simulation can be used to explore possibilities.
5.5. Consider a transportation company. Give three logistics-related examples where simulation can be used
to making wise investments and preparing for change.

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APPENDIX The simulation assignment group work

Create a Simulation Model with the SIMPROCESS


The objective of this simulation assignment is to make students
Use a specific simulation software, SIMPROCESS,
Familiarise with the procedure of creating a basic SIMPROCESS model,
Simulate the model created,
Analyse the simulation results in terms of the performance measures, such as total processing time,
wait time, resource utilization, and activity costs, and
Think about and evaluate possible alternatives to the simulation model for examining possible
improvement on the performance of the modelled task.



The modelling task:

This model is a description of a call service process for a mail order business. Calls arrive at the mail order
business and are routed by an automated answering system to either the customer service or sales
department. Customer Service Calls arrive based on an Exponential distribution with a mean value of 6
minutes. This means that a call arrives on average every 6 minutes. Sales calls arrive based on an
Exponential distribution with a mean value of 3 minutes. While the customer service calls take about 15
minutes (use Normal Distribution with a mean of 15, and a standard deviation of 3), the Sales calls take
about 6 minutes (use Triangular Distribution with a minimum of 3, mode of 6, and maximum of 12
minutes). It is assumed that all Sales calls are for placing sales calls. The departments are staffed with 3
customer service (at $15 per hour) and 4 sales representatives (at $12 per hour).


The major steps in doing this exercise are as follows:

1. Get and install the software. The software will be available before the start of the course. However,
students might obtain the free trial version on the company website:
http://www.simprocess.net/downloads/simprocess_registration_form.cfm

2. Locate the copy of the two user manuals (Getting Started Manual, and SIMPROCESS User Manual), to
be used as reference and help.

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3. Read the Getting Started Manual - Chapter 1 to get the basic knowledge of the software

4. Build a model for the task described above, run simulation for your model.
(You may need to refer to the the Getting Started Manual - Chapter 3 for this step.)

5. Analyse the simulation result this step is important. Normally, the performance measures interested are
processing time, wait time, resource utilization, and activity costs. In your analysis report, you need to
answer and explain
If the current performance are acceptable? Why?
Is there any ways to improve the performance? How?
List the possible ways (you can think of) for improvement, and make them ready for the step 6.
(You may need to refer to the the Getting Started Manual - Chapter 3 for this step.)

6. Add alternatives on the basis of the possible ways for improvement (from last step) to the model (you
dont need to create a new model.). Run the simulation for the alternatives and compare the simulation
results with the original model to see if the expected improvements are achieved.
(You may need to refer to the the Getting Started Manual - Chapter 4 for this step. Please note that
you should not copy the alternative given in the manual. You only use this manual to learn the
procedure of how to add alternatives to an existing model. You should add the alternatives based on
your own analysis got in step 5. )

7. In your assignment submission, you need to include:
The SIMPROCESS model you created for the call service task. The model should include the
original model built in step 4 and alternatives added in step 6. You may submit it by copying in a
CD-ROM disc.
The simulation report generated by the software and your analysis (as indicated in step 5)
The simulation report for the alternatives, and the comparison with the original model (as indicated
in step 6)