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BUS306 Applied Management Science Assignment

Added on - 16 May 2020

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Running head: APPLIED MANAGEMENT SCIENCEApplied Management ScienceName of the studentName of the universityAuthor’s note
APPLIED MANAGEMENT SCIENCE1Table of ContentsIntroduction......................................................................................................................................2Statement of the Problem.................................................................................................................2Sensitivity Analysis.........................................................................................................................2Conclusion and Recommendation...................................................................................................2Appendix..........................................................................................................................................2
APPLIED MANAGEMENT SCIENCE2IntroductionThis report presents the solution to the problem being faced by the joint GCC company.The company initially set up an electric manufacturing plant at Musafah. It supplied power to thefive cities of Dhahra, Manama, Riyadh, Kuwait and Jeddah from the Damam distribution center.With the growth of customer base another distribution centre was set up at Khalifa IndustrialZone in Abu Dhabi (KIZAD). Subsequently when the demand rose it set up another plant at Ras-al-Khaimah (RAK). In addition, another distribution centre was set up at Jabal Ali. At present thecompany supplied electric meters to 9 cities from three distribution centres and two productionplants.Statement of the ProblemA.Input analysis and assumptions (if any)The production plants of Musafah and Rak generate different amounts of meters. Musafahproduces 30000 meters and Rak produces 20000 meters. Moreover, the production costs ofMusafah and Rak are $10.50 and $10.00 respectively.The following table presents the cost to ship meters from the production to plant to thedistribution center.D i s t r i b u t i o n C e n t e r sPlantDamamKIZADJabal AliMusafah3.22.24.2RAK--3.91.2The following table presents the cost to ship meters from the distribution center to thecustomers zone.C u s t o m e r Z o n e sCenterDhahranManamaRiyadhKuwaitJeddahSalalahMuscatNizwaSoharDamam0.32.13.14.46.0--------KIZAD5.25.44.56.02.74.73.43.32.7Jabal Ali--------5.43.32.42.12.5Further, the requirements of each of the customer zones is given below:
APPLIED MANAGEMENT SCIENCE3Customer ZoneDhahranManamaRiyadhKuwaitJeddahSalalaMuscatNizwaSoharDemand630048802130121061204830275085804460B.Definitions of all decision variablesThe decision to be taken by the GCC company is how much power should be generatedby each the two manufacturing units. The organizations need to take a decision on howmuch meters is to be generated from the two manufacturing centres of Musafah and Rak.Moreover, the organizations also need to decide the quantity of meters to be distributed tothe three centers of Damam, Kizad and Jabal Ali. Further, the organization also needs todecide on the meters to be distributed from the three distribution centers to the ninecustomer zones.C.Detailed development of the objective functionThe objective function has three parts.1. The product of the manufacturing cost of meters at the two plants and the quantity ofproduction.2. The product of distribution cost from plant to distribution center3. The product of shipping cost from distribution plant to customer zoneD.Existing constraints and their significanceThe constraint is that Musfah plant can produce only 30000 meters while Rak can produceonly 20000 meters.E.Model Summary – number of Variables and ConstraintsThere are 24 variables.Minimize0.3*Damam Dhahran + 2.1*Damam Manama + 3.1*Damam Riyadh + 4.4*DamamKuwait + 6*Damam Jeddah + 5.2*KIZAD Dhahran + 5.4*KIZAD Manama +4.5*KIZAD Riyadh + 6*KIZAD Kuwait + 2.7*KIZAD Jeddah + 4.7*KIZAD Salalah +3.4*KIZAD Muscat + 3.3*KIZAD Nizwa + 2.7*KIZAD Sohar + 5.4*Jabal Ali Jeddah +
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