After studying this chapter you will be able to: Explain the terms lean operations and JIT, describe the main characteristics of lean systems, list the five principles of the way lean system function, list some of the benefits and some of the risks of lean operations,. | Supplement B - Introduction to Optimization Operations Management 6th Edition R. Dan Reid & Nada R. Sanders 1 Copyright © 2016 John Wiley & Sons, Inc. Learning Objectives Recognize decision-making situations that may benefit from an optimization modeling approach. Formulate algebraic models for linear programming problems. Develop spreadsheet models for linear programming problems. Use Excel’s Solver add-in to solve linear programming problems. Interpret the results of models and perform basic sensitivity analysis. Optimization Major field within the discipline of Operations Research and Management Science Optimization Problem Components Decision Variables Objective (to maximize or minimize) Constraints (requirements or limitations) Basic Idea Find the values of the decision variables that maximize (minimize) the objective function value, while staying within the constraints. Solving Optimization Problems Algebraic Formulation To address a problem using | Supplement B - Introduction to Optimization Operations Management 6th Edition R. Dan Reid & Nada R. Sanders 1 Copyright © 2016 John Wiley & Sons, Inc. Learning Objectives Recognize decision-making situations that may benefit from an optimization modeling approach. Formulate algebraic models for linear programming problems. Develop spreadsheet models for linear programming problems. Use Excel’s Solver add-in to solve linear programming problems. Interpret the results of models and perform basic sensitivity analysis. Optimization Major field within the discipline of Operations Research and Management Science Optimization Problem Components Decision Variables Objective (to maximize or minimize) Constraints (requirements or limitations) Basic Idea Find the values of the decision variables that maximize (minimize) the objective function value, while staying within the constraints. Solving Optimization Problems Algebraic Formulation To address a problem using optimization you must develop a formal algebraic description called a formulation which: Contains explicit definitions of the decision variables An algebraic expression of the objective function And algebraic statement of the constraints Example - DJJ Enterprises: Product Mix Decision DJJ Enterprises makes automotive parts, Camshafts & Gears Unit Profit: Camshafts $25/unit, Gears $18/unit Resources needed: Steel, Labor, Machine Time. In total, 5000 lbs steel available, 1500 hours labor, and 1000 hours machine time. Camshafts need 5 lbs steel, 1 hour labor, 3 hours machine time. Gears need 8 lbs steel, 4 hours labor, 2 hours machine time. How many camshafts & gears to make in order to maximize profit? Example - DJJ Enterprises: Understanding the Problem Text-Based Formulation Decision Variables: Number of camshafts to make, number of gears to make Objective Function: Maximize profit Constraints: Don’t exceed amounts available of steel, labor, and machine time. .
