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Assignment Method: Examples of How Resources Are Allocated

assignment method operations management

What Is the Assignment Method?

The assignment method is a way of allocating organizational resources in which each resource is assigned to a particular task. The resource could be monetary, personnel , or technological.

Understanding the Assignment Method

The assignment method is used to determine what resources are assigned to which department, machine, or center of operation in the production process. The goal is to assign resources in such a way to enhance production efficiency, control costs, and maximize profits.

The assignment method has various applications in maximizing resources, including:

  • Allocating the proper number of employees to a machine or task
  • Allocating a machine or a manufacturing plant and the number of jobs that a given machine or factory can produce
  • Assigning a number of salespersons to a given territory or territories
  • Assigning new computers, laptops, and other expensive high-tech devices to the areas that need them the most while lower priority departments would get the older models

Companies can make budgeting decisions using the assignment method since it can help determine the amount of capital or money needed for each area of the company. Allocating money or resources can be done by analyzing the past performance of an employee, project, or department to determine the most efficient approach.

Regardless of the resource being allocated or the task to be accomplished, the goal is to assign resources to maximize the profit produced by the task or project.

Example of Assignment Method

A bank is allocating its sales force to grow its mortgage lending business. The bank has over 50 branches in New York but only ten in Chicago. Each branch has a staff that is used to bring in new clients.

The bank's management team decides to perform an analysis using the assignment method to determine where their newly-hired salespeople should be allocated. Given the past performance results in the Chicago area, the bank has produced fewer new clients than in New York. The fewer new clients are the result of having a small market presence in Chicago.

As a result, the management decides to allocate the new hires to the New York region, where it has a greater market share to maximize new client growth and, ultimately, revenue.

assignment method operations management

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Assignment Problem: Meaning, Methods and Variations | Operations Research

assignment method operations management

After reading this article you will learn about:- 1. Meaning of Assignment Problem 2. Definition of Assignment Problem 3. Mathematical Formulation 4. Hungarian Method 5. Variations.

Meaning of Assignment Problem:

An assignment problem is a particular case of transportation problem where the objective is to assign a number of resources to an equal number of activities so as to minimise total cost or maximize total profit of allocation.

The problem of assignment arises because available resources such as men, machines etc. have varying degrees of efficiency for performing different activities, therefore, cost, profit or loss of performing the different activities is different.

Thus, the problem is “How should the assignments be made so as to optimize the given objective”. Some of the problem where the assignment technique may be useful are assignment of workers to machines, salesman to different sales areas.

Definition of Assignment Problem:

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Suppose there are n jobs to be performed and n persons are available for doing these jobs. Assume that each person can do each job at a term, though with varying degree of efficiency, let c ij be the cost if the i-th person is assigned to the j-th job. The problem is to find an assignment (which job should be assigned to which person one on-one basis) So that the total cost of performing all jobs is minimum, problem of this kind are known as assignment problem.

The assignment problem can be stated in the form of n x n cost matrix C real members as given in the following table:

assignment method operations management

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assignment method operations management

MBA Notes

How to Solve the Assignment Problem: A Complete Guide

Table of Contents

Assignment problem is a special type of linear programming problem that deals with assigning a number of resources to an equal number of tasks in the most efficient way. The goal is to minimize the total cost of assignments while ensuring that each task is assigned to only one resource and each resource is assigned to only one task. In this blog, we will discuss the solution of the assignment problem using the Hungarian method, which is a popular algorithm for solving the problem.

Understanding the Assignment Problem

Before we dive into the solution, it is important to understand the problem itself. In the assignment problem, we have a matrix of costs, where each row represents a resource and each column represents a task. The objective is to assign each resource to a task in such a way that the total cost of assignments is minimized. However, there are certain constraints that need to be satisfied – each resource can be assigned to only one task and each task can be assigned to only one resource.

Solving the Assignment Problem

There are various methods for solving the assignment problem, including the Hungarian method, the brute force method, and the auction algorithm. Here, we will focus on the steps involved in solving the assignment problem using the Hungarian method, which is the most commonly used and efficient method.

Step 1: Set up the cost matrix

The first step in solving the assignment problem is to set up the cost matrix, which represents the cost of assigning a task to an agent. The matrix should be square and have the same number of rows and columns as the number of tasks and agents, respectively.

Step 2: Subtract the smallest element from each row and column

To simplify the calculations, we need to reduce the size of the cost matrix by subtracting the smallest element from each row and column. This step is called matrix reduction.

Step 3: Cover all zeros with the minimum number of lines

The next step is to cover all zeros in the matrix with the minimum number of horizontal and vertical lines. This step is called matrix covering.

Step 4: Test for optimality and adjust the matrix

To test for optimality, we need to calculate the minimum number of lines required to cover all zeros in the matrix. If the number of lines equals the number of rows or columns, the solution is optimal. If not, we need to adjust the matrix and repeat steps 3 and 4 until we get an optimal solution.

Step 5: Assign the tasks to the agents

The final step is to assign the tasks to the agents based on the optimal solution obtained in step 4. This will give us the most cost-effective or profit-maximizing assignment.

Solution of the Assignment Problem using the Hungarian Method

The Hungarian method is an algorithm that uses a step-by-step approach to find the optimal assignment. The algorithm consists of the following steps:

  • Subtract the smallest entry in each row from all the entries of the row.
  • Subtract the smallest entry in each column from all the entries of the column.
  • Draw the minimum number of lines to cover all zeros in the matrix. If the number of lines drawn is equal to the number of rows, we have an optimal solution. If not, go to step 4.
  • Determine the smallest entry not covered by any line. Subtract it from all uncovered entries and add it to all entries covered by two lines. Go to step 3.

The above steps are repeated until an optimal solution is obtained. The optimal solution will have all zeros covered by the minimum number of lines. The assignments can be made by selecting the rows and columns with a single zero in the final matrix.

Applications of the Assignment Problem

The assignment problem has various applications in different fields, including computer science, economics, logistics, and management. In this section, we will provide some examples of how the assignment problem is used in real-life situations.

Applications in Computer Science

The assignment problem can be used in computer science to allocate resources to different tasks, such as allocating memory to processes or assigning threads to processors.

Applications in Economics

The assignment problem can be used in economics to allocate resources to different agents, such as allocating workers to jobs or assigning projects to contractors.

Applications in Logistics

The assignment problem can be used in logistics to allocate resources to different activities, such as allocating vehicles to routes or assigning warehouses to customers.

Applications in Management

The assignment problem can be used in management to allocate resources to different projects, such as allocating employees to tasks or assigning budgets to departments.

Let’s consider the following scenario: a manager needs to assign three employees to three different tasks. Each employee has different skills, and each task requires specific skills. The manager wants to minimize the total time it takes to complete all the tasks. The skills and the time required for each task are given in the table below:

The assignment problem is to determine which employee should be assigned to which task to minimize the total time required. To solve this problem, we can use the Hungarian method, which we discussed in the previous blog.

Using the Hungarian method, we first subtract the smallest entry in each row from all the entries of the row:

Next, we subtract the smallest entry in each column from all the entries of the column:

We draw the minimum number of lines to cover all the zeros in the matrix, which in this case is three:

Since the number of lines is equal to the number of rows, we have an optimal solution. The assignments can be made by selecting the rows and columns with a single zero in the final matrix. In this case, the optimal assignments are:

  • Emp 1 to Task 3
  • Emp 2 to Task 2
  • Emp 3 to Task 1

This assignment results in a total time of 9 units.

I hope this example helps you better understand the assignment problem and how to solve it using the Hungarian method.

Solving the assignment problem may seem daunting, but with the right approach, it can be a straightforward process. By following the steps outlined in this guide, you can confidently tackle any assignment problem that comes your way.

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Operations Research

1 Operations Research-An Overview

  • History of O.R.
  • Approach, Techniques and Tools
  • Phases and Processes of O.R. Study
  • Typical Applications of O.R
  • Limitations of Operations Research
  • Models in Operations Research
  • O.R. in real world

2 Linear Programming: Formulation and Graphical Method

  • General formulation of Linear Programming Problem
  • Optimisation Models
  • Basics of Graphic Method
  • Important steps to draw graph
  • Multiple, Unbounded Solution and Infeasible Problems
  • Solving Linear Programming Graphically Using Computer
  • Application of Linear Programming in Business and Industry

3 Linear Programming-Simplex Method

  • Principle of Simplex Method
  • Computational aspect of Simplex Method
  • Simplex Method with several Decision Variables
  • Two Phase and M-method
  • Multiple Solution, Unbounded Solution and Infeasible Problem
  • Sensitivity Analysis
  • Dual Linear Programming Problem

4 Transportation Problem

  • Basic Feasible Solution of a Transportation Problem
  • Modified Distribution Method
  • Stepping Stone Method
  • Unbalanced Transportation Problem
  • Degenerate Transportation Problem
  • Transhipment Problem
  • Maximisation in a Transportation Problem

5 Assignment Problem

  • Solution of the Assignment Problem
  • Unbalanced Assignment Problem
  • Problem with some Infeasible Assignments
  • Maximisation in an Assignment Problem
  • Crew Assignment Problem

6 Application of Excel Solver to Solve LPP

  • Building Excel model for solving LP: An Illustrative Example

7 Goal Programming

  • Concepts of goal programming
  • Goal programming model formulation
  • Graphical method of goal programming
  • The simplex method of goal programming
  • Using Excel Solver to Solve Goal Programming Models
  • Application areas of goal programming

8 Integer Programming

  • Some Integer Programming Formulation Techniques
  • Binary Representation of General Integer Variables
  • Unimodularity
  • Cutting Plane Method
  • Branch and Bound Method
  • Solver Solution

9 Dynamic Programming

  • Dynamic Programming Methodology: An Example
  • Definitions and Notations
  • Dynamic Programming Applications

10 Non-Linear Programming

  • Solution of a Non-linear Programming Problem
  • Convex and Concave Functions
  • Kuhn-Tucker Conditions for Constrained Optimisation
  • Quadratic Programming
  • Separable Programming
  • NLP Models with Solver

11 Introduction to game theory and its Applications

  • Important terms in Game Theory
  • Saddle points
  • Mixed strategies: Games without saddle points
  • 2 x n games
  • Exploiting an opponent’s mistakes

12 Monte Carlo Simulation

  • Reasons for using simulation
  • Monte Carlo simulation
  • Limitations of simulation
  • Steps in the simulation process
  • Some practical applications of simulation
  • Two typical examples of hand-computed simulation
  • Computer simulation

13 Queueing Models

  • Characteristics of a queueing model
  • Notations and Symbols
  • Statistical methods in queueing
  • The M/M/I System
  • The M/M/C System
  • The M/Ek/I System
  • Decision problems in queueing

Procedure, Example Solved Problem | Operations Research - Solution of assignment problems (Hungarian Method) | 12th Business Maths and Statistics : Chapter 10 : Operations Research

Chapter: 12th business maths and statistics : chapter 10 : operations research.

Solution of assignment problems (Hungarian Method)

First check whether the number of rows is equal to the numbers of columns, if it is so, the assignment problem is said to be balanced.

Step :1 Choose the least element in each row and subtract it from all the elements of that row.

Step :2 Choose the least element in each column and subtract it from all the elements of that column. Step 2 has to be performed from the table obtained in step 1.

Step:3 Check whether there is atleast one zero in each row and each column and make an assignment as follows.

assignment method operations management

Step :4 If each row and each column contains exactly one assignment, then the solution is optimal.

Example 10.7

Solve the following assignment problem. Cell values represent cost of assigning job A, B, C and D to the machines I, II, III and IV.

assignment method operations management

Here the number of rows and columns are equal.

∴ The given assignment problem is balanced. Now let us find the solution.

Step 1: Select a smallest element in each row and subtract this from all the elements in its row.

assignment method operations management

Look for atleast one zero in each row and each column.Otherwise go to step 2.

Step 2: Select the smallest element in each column and subtract this from all the elements in its column.

assignment method operations management

Since each row and column contains atleast one zero, assignments can be made.

Step 3 (Assignment):

assignment method operations management

Thus all the four assignments have been made. The optimal assignment schedule and total cost is

assignment method operations management

The optimal assignment (minimum) cost

Example 10.8

Consider the problem of assigning five jobs to five persons. The assignment costs are given as follows. Determine the optimum assignment schedule.

assignment method operations management

∴ The given assignment problem is balanced.

Now let us find the solution.

The cost matrix of the given assignment problem is

assignment method operations management

Column 3 contains no zero. Go to Step 2.

assignment method operations management

Thus all the five assignments have been made. The Optimal assignment schedule and total cost is

assignment method operations management

The optimal assignment (minimum) cost = ` 9

Example 10.9

Solve the following assignment problem.

assignment method operations management

Since the number of columns is less than the number of rows, given assignment problem is unbalanced one. To balance it , introduce a dummy column with all the entries zero. The revised assignment problem is

assignment method operations management

Here only 3 tasks can be assigned to 3 men.

Step 1: is not necessary, since each row contains zero entry. Go to Step 2.

assignment method operations management

Step 3 (Assignment) :

assignment method operations management

Since each row and each columncontains exactly one assignment,all the three men have been assigned a task. But task S is not assigned to any Man. The optimal assignment schedule and total cost is

assignment method operations management

The optimal assignment (minimum) cost = ₹ 35

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Hungarian Method

The Hungarian method is a computational optimization technique that addresses the assignment problem in polynomial time and foreshadows following primal-dual alternatives. In 1955, Harold Kuhn used the term “Hungarian method” to honour two Hungarian mathematicians, Dénes Kőnig and Jenő Egerváry. Let’s go through the steps of the Hungarian method with the help of a solved example.

Hungarian Method to Solve Assignment Problems

The Hungarian method is a simple way to solve assignment problems. Let us first discuss the assignment problems before moving on to learning the Hungarian method.

What is an Assignment Problem?

A transportation problem is a type of assignment problem. The goal is to allocate an equal amount of resources to the same number of activities. As a result, the overall cost of allocation is minimised or the total profit is maximised.

Because available resources such as workers, machines, and other resources have varying degrees of efficiency for executing different activities, and hence the cost, profit, or loss of conducting such activities varies.

Assume we have ‘n’ jobs to do on ‘m’ machines (i.e., one job to one machine). Our goal is to assign jobs to machines for the least amount of money possible (or maximum profit). Based on the notion that each machine can accomplish each task, but at variable levels of efficiency.

Hungarian Method Steps

Check to see if the number of rows and columns are equal; if they are, the assignment problem is considered to be balanced. Then go to step 1. If it is not balanced, it should be balanced before the algorithm is applied.

Step 1 – In the given cost matrix, subtract the least cost element of each row from all the entries in that row. Make sure that each row has at least one zero.

Step 2 – In the resultant cost matrix produced in step 1, subtract the least cost element in each column from all the components in that column, ensuring that each column contains at least one zero.

Step 3 – Assign zeros

  • Analyse the rows one by one until you find a row with precisely one unmarked zero. Encircle this lonely unmarked zero and assign it a task. All other zeros in the column of this circular zero should be crossed out because they will not be used in any future assignments. Continue in this manner until you’ve gone through all of the rows.
  • Examine the columns one by one until you find one with precisely one unmarked zero. Encircle this single unmarked zero and cross any other zero in its row to make an assignment to it. Continue until you’ve gone through all of the columns.

Step 4 – Perform the Optimal Test

  • The present assignment is optimal if each row and column has exactly one encircled zero.
  • The present assignment is not optimal if at least one row or column is missing an assignment (i.e., if at least one row or column is missing one encircled zero). Continue to step 5. Subtract the least cost element from all the entries in each column of the final cost matrix created in step 1 and ensure that each column has at least one zero.

Step 5 – Draw the least number of straight lines to cover all of the zeros as follows:

(a) Highlight the rows that aren’t assigned.

(b) Label the columns with zeros in marked rows (if they haven’t already been marked).

(c) Highlight the rows that have assignments in indicated columns (if they haven’t previously been marked).

(d) Continue with (b) and (c) until no further marking is needed.

(f) Simply draw the lines through all rows and columns that are not marked. If the number of these lines equals the order of the matrix, then the solution is optimal; otherwise, it is not.

Step 6 – Find the lowest cost factor that is not covered by the straight lines. Subtract this least-cost component from all the uncovered elements and add it to all the elements that are at the intersection of these straight lines, but leave the rest of the elements alone.

Step 7 – Continue with steps 1 – 6 until you’ve found the highest suitable assignment.

Hungarian Method Example

Use the Hungarian method to solve the given assignment problem stated in the table. The entries in the matrix represent each man’s processing time in hours.

\(\begin{array}{l}\begin{bmatrix} & I & II & III & IV & V \\1 & 20 & 15 & 18 & 20 & 25 \\2 & 18 & 20 & 12 & 14 & 15 \\3 & 21 & 23 & 25 & 27 & 25 \\4 & 17 & 18 & 21 & 23 & 20 \\5 & 18 & 18 & 16 & 19 & 20 \\\end{bmatrix}\end{array} \)

With 5 jobs and 5 men, the stated problem is balanced.

\(\begin{array}{l}A = \begin{bmatrix}20 & 15 & 18 & 20 & 25 \\18 & 20 & 12 & 14 & 15 \\21 & 23 & 25 & 27 & 25 \\17 & 18 & 21 & 23 & 20 \\18 & 18 & 16 & 19 & 20 \\\end{bmatrix}\end{array} \)

Subtract the lowest cost element in each row from all of the elements in the given cost matrix’s row. Make sure that each row has at least one zero.

\(\begin{array}{l}A = \begin{bmatrix}5 & 0 & 3 & 5 & 10 \\6 & 8 & 0 & 2 & 3 \\0 & 2 & 4 & 6 & 4 \\0 & 1 & 4 & 6 & 3 \\2 & 2 & 0 & 3 & 4 \\\end{bmatrix}\end{array} \)

Subtract the least cost element in each Column from all of the components in the given cost matrix’s Column. Check to see if each column has at least one zero.

\(\begin{array}{l}A = \begin{bmatrix}5 & 0 & 3 & 3 & 7 \\6 & 8 & 0 & 0 & 0 \\0 & 2 & 4 & 4 & 1 \\0 & 1 & 4 & 4 & 0 \\2 & 2 & 0 & 1 & 1 \\\end{bmatrix}\end{array} \)

When the zeros are assigned, we get the following:

Hungarian Method

The present assignment is optimal because each row and column contain precisely one encircled zero.

Where 1 to II, 2 to IV, 3 to I, 4 to V, and 5 to III are the best assignments.

Hence, z = 15 + 14 + 21 + 20 + 16 = 86 hours is the optimal time.

Practice Question on Hungarian Method

Use the Hungarian method to solve the following assignment problem shown in table. The matrix entries represent the time it takes for each job to be processed by each machine in hours.

\(\begin{array}{l}\begin{bmatrix}J/M & I & II & III & IV & V \\1 & 9 & 22 & 58 & 11 & 19 \\2 & 43 & 78 & 72 & 50 & 63 \\3 & 41 & 28 & 91 & 37 & 45 \\4 & 74 & 42 & 27 & 49 & 39 \\5 & 36 & 11 & 57 & 22 & 25 \\\end{bmatrix}\end{array} \)

Stay tuned to BYJU’S – The Learning App and download the app to explore all Maths-related topics.

Frequently Asked Questions on Hungarian Method

What is hungarian method.

The Hungarian method is defined as a combinatorial optimization technique that solves the assignment problems in polynomial time and foreshadowed subsequent primal–dual approaches.

What are the steps involved in Hungarian method?

The following is a quick overview of the Hungarian method: Step 1: Subtract the row minima. Step 2: Subtract the column minimums. Step 3: Use a limited number of lines to cover all zeros. Step 4: Add some more zeros to the equation.

What is the purpose of the Hungarian method?

When workers are assigned to certain activities based on cost, the Hungarian method is beneficial for identifying minimum costs.

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Operations Management: Processes & Best Practices

assignment method operations management

Operations management influences every part of how you run a company. That includes how you produce a product or service, how you track and improve your efficiency and how you contribute to the bottom line. Simply put, operations management drives efficient workforces, processes and supply chains.

This guide explores the types of operations management and how they bring value to a business. Explore the ins and outs of operations management strategy and learn the best practices to achieve success.

Inside this article:

  • Types of operations management
  • Business management vs. operations management
  • Operations management process
  • Best practices for operations management

What Is Operations Management?

Operations management is the practice of handling day-to-day business functions in a manner that is efficient and that maximizes profitability. This discipline focuses on formulating strategies and taking actions to optimize production and supply chain performance.

Key Takeaways

  • Operations management focuses on multiple aspects of an organization’s day-to-day operations, not just resolving the inevitable one-off problems that arise.
  • Without operations management, critical business functions like R&D, client service delivery, information technology and inventory control are prone to mismanagement and underfunding.
  • Behind most successful supply chains is solid operations management because it provides managers the means to direct resources toward desired results.

What Is the Purpose of Operations Management?

The purpose of operations management is to promote and support efficient business processes. The practice focuses on the staff, processes and physical resources required to operate a business.

Operations management also refers to how an organization coordinates and oversees the flow of information among its departments; how successful it is at complying with business and regulatory requirements; how well it ensures customer satisfaction; and how efficiently it manages daily operations, not just resolving problems that occasionally arise.

Goals of Operation Management

The goals of operations management are about maximizing the organization’s efforts, mainly around producing goods and/or services and managing the supply chain and infrastructure. The focus is on controlling costs, maximizing profitability and properly allocating resources.

Operations managers seek to reduce operating costs by coordinating business tasks, ensuring qualified people are in the right positions and continuously monitoring performance metrics.

Importance of Operations Management

An effective operations management practice makes a business more competitive and prevents it from wasting time and money on activities that don’t forward the company’s strategic vision. An effective operations manager ensures the organization meets business goals.

Operations management is necessary for companies to stay competitive in any industry, but healthcare, technology and manufacturing firms often have a particular focus. Without efficient operations management, critical business functions like research, client service delivery, IT and inventory control may fall prey to mismanagement.

Types of Operations Management

The three main types of operations management focus on the objective , the task or the individual employee . Which you use depends on your company’s needs and goals, and a manager might use different types based on the situation.

Objectives management:

Setting priorities, making operational decisions based on business goals and aligning operations to support overall company objectives.

Task management:

Managing daily operations based on work in progress and linear workflows to assign tasks before moving to the next phase.

Individual supervision:

Using real-time information from managers and employees on the ground performing the work to optimize operations.

Some facets of operations management may require additional functions. For example, tasks may consist of planning and researching; creating operational budgets; and managing physical inventory, supply chains and vendors.

In addition to the types of business functions, there are three categories of modern operations management environments:

Centralized:

Shops with centralized operations management typically use one central control system to manage essential supply chain functions and oversee multiple employees who work in one location.

Decentralized:

Decentralized operations management uses multiple systems, including advanced infrastructure and technology like web applications and cloud databases, to coordinate work across global supply chains and multiple locations.

A hybrid operations management environment leverages the advantages of centralized and decentralized operations. For example, you might have a centralized production center with unified manufacturing and warehousing capabilities and equipped with an automated infrastructure connected to cloud-based networks for real-time monitoring.

Operations Management Eco-System

operations management

Strategic vs. Tactical Operations Management Decisions

Strategic operations management focuses on long-term success, while tactical operations decisions are about reacting and adjusting in the short term. Use a combination of these approaches for the best results.

Strategic operations decisions involve estimates, predictions, goals and comparative analyses. This approach concentrates on the future to meet long-term objectives and ensure lasting success. One key aspect is using operational data to analyze results and adjust long-term strategic plans where necessary.

Tactical operations decisions, on the other hand, involve how the company responds to changing operational conditions. For example, an organization might need to adjust production schedules or workforce planning as the marketplace fluctuates.

Business Management vs. Operations Management

Companies may combine the practices of business and operations management, but there is a difference. Business management focuses on long-term planning, while operations management concentrates on daily activities.

Operations management

Is a broad term used to describe the process of overseeing the day-to-day activities at a business. These functions could include scheduling staff, making payroll, receiving and processing payments, organizing equipment and supplies and more.

Business management

Focuses on planning and strategizing for future results. Business management requires extensive general knowledge and incorporates external factors, while operations management requires a high level of operational expertise.

Examples of general business management goals might include maximizing revenue, minimizing costs and maintaining customer satisfaction. Operations management goals include:

  • Maximizing resources for research and development
  • Environmental protection
  • Maintaining quality control in manufacturing
  • Meeting financial obligations
  • Maintaining industry-specific legal and compliance requirements

What’s the Difference Between Business Management and Operations Management?

project management vs operations management

Project Management vs. Operations Management Which One Does Your Small Business Need?

Operations and supply chain management.

Operations management is vital for any company that relies on logistics management and the supply chain. The practice protects supply chain operations, boosts productivity and reduces costs.

Operations management is critical in companies that have complex supply chains because it provides a framework for process-specific technology, tools and activities to support a steady flow of materials and finished goods and gives managers the means to efficiently direct resources toward reaching goals. Operations managers rely on strong logistics management and supply chain management .

A mature operations management practice helps create processes and systems to manage and measure supply chain activities. For example, when customers cancel orders or return goods to the warehouse, the operations management team is responsible for having procedures in place to reduce administrative overhead, adjust production levels and/or maximize the resale value of the items.

Effective operations management touches all aspects of essential work, including supply chain, and ensures the company is meeting key performance indicators (KPIs) . Managers use operations management KPIs to make informed decisions and coordinate efforts across the supply chain and organization as a whole.

What Are the Main Functions of Operations Management?

The main functions of operations management are developing effective processes, ensuring production is efficient and determining the most cost-effective way to achieve goals. Operations managers help organize resources using sound HR concepts, the right technology and up-to-date best practices.

Functions often are cross-departmental and include:

  • Process analysis
  • Financial oversight
  • Risk management
  • Data privacy and security
  • Quality assurance
  • Preparing and disseminating reports
  • Scheduling staff
  • Providing technical support
  • Managing equipment and supplies
  • Controlling inventory
  • Overseeing external vendors

Operations Management Process

The operations management process is about making a company’s daily actions as sharp and effective as possible. The process involves smart use of resources and data to reach goals while keeping costs down.

Operations management also refers to the processes, tools and resources necessary to support an organization’s full workflow. It requires communication with clients, stakeholders and business units.

Three categories of operations management processes, based on desired business outcome, include:

Implementation:

Designing and engineering infrastructure and systems so your business operations function efficiently.

Optimization:

Ensuring that your staff and infrastructure serve the business’s goals as effectively and efficiently as possible.

Improvement:

Introducing operational methods that previously did not apply — for example, remote work — and maximizing the efficiency and effectiveness of existing processes.

The ideal operations management process for a given company varies by industry, company size and other factors. Generally, it captures the process of managing the daily flow of tasks and information to ensure consistent and effective performance across projects. This process can include variables such as finance, human resources, information technology, facilities management, inventory management and more.

Role of Operations Management

The role of operations management boils down to driving optimal results while reducing costs. An effective operations manager allocates a company’s resources to achieve goals and meet standards.

Most companies have an operations department for this reason, although the specific role may vary from company to company and industry to industry. The responsibilities of an operations manager include the overall direction of company operations, financial planning and resource allocation for specific projects and service offerings.

In general, ops managers direct their companies’ day-to-day business activities. They ensure that the workforce conducts daily operations following company policies and standards and relevant laws and regulations. Their key responsibilities include overseeing daily business activities, studying processes and preparing operational and financial reports.

In addition, these managers measure the impact of business operations by collecting, processing and communicating operational KPIs .

Effective operations management requires a holistic view of the business, including resource allocation, documentation review, quality control, coordination of efforts, sharing information across departments and initiating appropriate actions when needed. Typically, operations managers have a cross-departmental view, carry out duties assigned by leaders, ensure the efficient use of resources and help plan and prepare to achieve future goals. Day-to-day operational management tasks include record-keeping and operational reporting .

Depending on company size and scope, ops managers may take on business development or marketing roles. For example, ops management teams may include financial analysts, sales leaders, software developers and IT support. The practice typically includes cross-functional coordination among department heads and units.

Operations Management Example

To understand operations management, consider these examples. The first is a manager who oversees a company’s production, workflow, inventory, equipment and people. Another one in is a manager overseeing a service, such as IT.

The field has evolved to include service-related tasks involved in making efficient, value-driven operational decisions. For example, IT operations management includes maintaining the hardware and software to enable IT strategy, planning, decision-making, research and technical support.

Operations workflows in IT ops management include the techniques that support the organization’s efficient and safe use of technology resources and deal with the design, implementation, administration, monitoring and performance of security measures in information systems. Those tasks protect the integrity, confidentiality and availability of data. This role requires a comprehensive knowledge of IT security policies and operational awareness combined with proactive thinking and problem-solving skills.

Best Practices for Operations Management

Operations management best practices start with modern methods that allow employees to do their jobs efficiently and deliver a desirable product or service to customers. However, best practices may vary by company and need to evolve in tandem with changing priorities.

While there is no single path to efficient operations, organizations and individuals have found effective ways to improve modern operations management. These include:

Use technology to gain efficiency.

As workforce automation eliminates more and more routine business processes, modern operations managers optimize operational capabilities using data-led design and engineering.

Turn to data for decision-making.

Modern ops management strategies focus on making sound business decisions based on data-driven analysis rather than relying solely on past results, employee and customer behavior and personal biases.

Use operations management for business processes.

Use operations management methods for business process redesign (BPR) and business process automation (BPA) projects.

BPR for ops management refers to overhauling your critical business processes using information and data gleaned from operations management performance metrics. BPR can improve return on investment, reduce operational costs, increase production capacity and enhance service capabilities.

BPA for ops management refers to using technology to assist with or replace manual tasks and processes. BPA can increase efficiency, save time and money, reduce errors and increase transparency. Automating ops management is most effective when replacing tasks that involve inefficient use of time and resources.

Challenges in Operations Management

Operation management challenges include decision-making, resource allocation and time management; the goal is to ensure objectives are met on time and within budget.

Common operation management challenges include:

Business dynamics:

Operations managers juggle multiple business functions and make decisions that touch other departments in areas such as product development, customer support and finance.

Global ops:

Global supply chains challenge operations management to stay current with global market trends and find operational efficiencies across international operating environments.

Advanced technology:

Advances in technology continue to increase the technical complexity of this discipline. Today, ops managers require significant technical proficiency and information management expertise.

Time management:

Operations management problems arise from many places, but the most frequent challenge is inefficient time allocation caused by factors such as labor shortages.

Sustainability:

Evolving regulations and resource shortages challenge operations managers to find sustainable business practice efficiencies that account for future operating environments.

Operations management is partly responsible for shaping the organizational policies and practices essential for safe, efficient and secure departmental functions. It involves planning, controlling, supervising and controlling the work of assigned employees necessary to accomplish set goals and objectives.

An operations manager has two primary purposes: Manage operational resources and meet the organization’s goals and objectives. Understanding common operations issues allow ops managers to prevent or eliminate operational inefficiencies that affect an organization's ability to perform its core functions efficiently.

Human Behavior and Operations Management

The field of behavioral operations management examines the decision-making role. This is key because human beings don’t always base their decisions on logic and factual information.

Many organizations are undergoing a transformation — from being purpose-built for one market to being massively complex with dozens of functions. As a result, operations management techniques must become more agile and cross-functional. Unfortunately, small to midsize businesses may lack cross-functional leadership and accountability in operations management. When leadership is lacking, inefficiencies and behavioral issues can grow and spread throughout an organization.

Research in this field from the Journal of Operations Management focuses on understanding human behavior to improve operations management and realize its benefits. For example, risk aversion is a behavioral issue that research shows can hinder ops management. This issue manifests in many forms and can also harm performance.

An Example of How Technology Fuels Operations Management

The family-owned, online furniture company casalife needed an integrated business solution to become more efficient to stay competitive with larger online retailers. The small retailer couldn’t afford the high up-front IT investment and maintenance costs associated with typical on-premises solutions.

With NetSuite’s SuiteCommerce solution, casalife was able to meet the demands of its ecommerce operations and become more agile and able to take on growth opportunities. The result was an estimated savings of $120,000 a year in personnel and other costs using NetSuite for purchasing, operations management and CRM compared to the competing solution.

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Gain a more cohesive picture of your manufacturing operations and empower quicker response times to ensure optimal production. The system’s built-in business intelligence toolkit helps you create more informed strategic decisions through real-time analysis of supply chain data that drives system improvement. Empower your ops managers, put ops data into action, and get products to market faster and more efficiently with unified global manufacturing management (opens in new tab) in the cloud.

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Operational Reporting: Types, Examples and Best Practices

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Home » Management Science » Transportation and Assignment Models in Operations Research

Transportation and Assignment Models in Operations Research

Transportation and assignment models are special purpose algorithms of the linear programming.   The simplex method of Linear Programming Problems(LPP)   proves to be inefficient is certain situations like determining optimum assignment of jobs to persons, supply of materials from several supply points to several destinations and the like. More effective solution models have been evolved and these are called assignment and transportation models.

The transportation model is concerned with selecting the routes between supply and demand points in order to minimize costs of transportation subject to constraints of supply at any supply point and demand at any demand point.   Assume a company has 4 manufacturing plants with different capacity levels, and 5 regional distribution centres.     4 x 5 = 20 routes are possible.   Given the transportation costs per load of each of 20 routes between the manufacturing (supply) plants and the regional distribution (demand) centres, and supply and demand constraints, how many loads can be transported through different routes so as to minimize transportation costs?   The answer to this question is obtained easily through the transportation algorithm.

Similarly, how are we to assign different jobs to different persons/machines, given cost of job completion for each pair of job machine/person?   The objective is minimizing total cost.   This is best solved through assignment algorithm.

Uses of Transportation and Assignment Models in Decision Making

The broad purposes of Transportation and Assignment models in LPP are just mentioned above.   Now we have just enumerated the different situations where we can make use of these models.

Transportation model is used in the following:

  • To decide the transportation of new materials from various centres to different manufacturing plants.   In the case of multi-plant company this is highly useful.
  • To decide the transportation of finished goods from different manufacturing plants to the different distribution centres.   For a multi-plant-multi-market company this is useful.
  • To decide the transportation of finished goods from different manufacturing plants to the different distribution centres.   For a multi-plant-multi-market company this is useful.   These two are the uses of transportation model.   The objective is minimizing transportation cost.

Assignment model is used in the following:

  • To decide the assignment of jobs to persons/machines, the assignment model is used.
  • To decide the route a traveling executive has to adopt (dealing with the order inn which he/she has to visit different places).
  • To decide the order in which different activities performed on one and the same facility be taken up.

In the case of transportation model, the supply quantity may be less or more than the demand.   Similarly the assignment model, the number of jobs may be equal to, less or more than the number of machines/persons available.   In all these cases the simplex method of LPP can be adopted, but transportation and assignment models are more effective, less time consuming and easier than the LPP.

Related Posts:

  • Economic interpretation of linear programming duality
  • Waiting Lines and Queuing System in Management Science
  • Model of Quantitative Analysis
  • Introduction to Linear Programming (L.P)
  • Procedure for finding an optimum solution for transportation problem
  • Introduction to Transportation Problem
  • Initial basic feasible solution of a transportation problem
  • Introduction to Crtical Path Analysis
  • Construction of Mathematical Decision Model
  • Duality in linear programming

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Exclussive dff. And easy understude

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Course info, instructors.

  • Prof. Charles H. Fine
  • Prof. Tauhid Zaman

Departments

  • Sloan School of Management

As Taught In

  • Mathematics
  • Social Science

Introduction to Operations Management

Assignments, “quick” case analyses.

The purpose of these assignments is to support your thinking about primarily qualitative issues raised in the course. These three write-ups ( choose three from CVS, Toyota, Zara/M&S, Amazon, European Recycling, Hank Kolb, Katrina, Break.com, Barilla ) should provide a point of view as to what some protagonist in the case should do given the situation faced. These write-ups should be in the form of a one-page memo (single spaced, max font of 12) and contain your opinions, based on reasoned analysis addressing issues raised by the preparation questions (see the Case Preparation Questions section). Please DO NOT answer these questions directly. Rather, use these questions to help guide your thinking as to what issues may be relevant in the case. Quantitative or numerical analyses ARE NOT EXPECTED in these quick case analyses, although they are not discouraged either. In preparing for these assignments, please adhere to the following guidelines:

  • Work as an individual on these assignments. This is a firm constraint, no exceptions.
  • Written assignments are to be turned in at the beginning of class on the due date assigned.
  • Case analysis assignments are limited in length to a single-page, single-spaced memo using a text font no smaller than 12.
  • Each one-page memo may be accompanied by up to two pages of supporting exhibits, provided they are clear and self-explanatory. No fonts smaller than 12.

“Deep” Case Analyses

These two write-ups ( choose two from PATA, HP-DeskJet, and Sport Obermeyer ) should contain your answers to the specific preparation questions for the corresponding cases (see the Case Preparation Questions section). In preparing for these assignments, please adhere to the following guidelines:

  • Work in teams of at most 3 students. This is a firm constraint, no exceptions.
  • Case analysis assignments must be less than 4 pages in length (excluding appendices) and use text fonts no smaller than 12.
  • Every graph or table/spreadsheet showing the results of computations must be accompanied by both a clear description of what all numbers shown represent qualitatively, and a detailed explanation of how they are computed, including a statement of all the relevant mathematical formulas or algorithms. Please do not submit a table copied from a spreadsheet assuming that the instructors will try to figure out by themselves how the numbers it shows are calculated—they won’t.

There will be two short homework assignments that will aim to test your grasp of some of the quantitative material taught in the course:

  • The assignments should be done individually and submitted at the beginning of class on the day they are due.
  • Homework assignments should be 1 page of text font no smaller than 12.

The Goal Book Report

Each student in the class should individually prepare and turn in a report of at most 3 pages containing answers to the following questions (in Q&A form, not essay form):

  • What are the methods described in The Goal for identifying a bottleneck?
  • After bottlenecks have been identified, what are the concrete factory floor-level actions described in the book for improving overall system performance?
  • Relate the notions of statistical fluctuations and dependent events mentioned in the book to concepts covered during the course. Also explain and relate to course concepts the statement made by Jonah that a factory “balanced with demand” will soon experience bankruptcy.
  • Several times in the book, lot sizes are reduced in order to decrease cycle time. What are the limits to this strategy?
  • When designing an operational process from scratch, which process step(s) should be the bottleneck(s)?
  • What are the high-level management messages in this book that you consider to be of value?
  • Leaving writing style and other delivery issues aside (e.g., romance novel format), what substantial critiques of this book would you make pertaining to its function as a “textbook” on the management of business operations?

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COMMENTS

  1. Assignment Method

    Assignment Method Explained. The assignment method in operation research is a strategy for allocating organizational resources to tasks to increase profit via efficiency gains, cost reductions, and improved handling of operations that might create bottlenecks.It is an operations management tool that, by allocating jobs to the appropriate individual, minimizes expenses, time, and effort.

  2. Assignment Method: Examples of How Resources Are Allocated

    Assignment Method: A method of allocating organizational resources. The assignment method is used to determine what resources are assigned to which department, machine or center of operation in ...

  3. Assignment Problem: Meaning, Methods and Variations

    After reading this article you will learn about:- 1. Meaning of Assignment Problem 2. Definition of Assignment Problem 3. Mathematical Formulation 4. Hungarian Method 5. Variations. Meaning of Assignment Problem: An assignment problem is a particular case of transportation problem where the objective is to assign a number of resources to an equal number of activities so as to minimise total ...

  4. Assignment method definition

    The assignment method is any technique used to assign organizational resources to activities. The best assignment method will maximize profits, typically through cost controls, increases in efficiency levels, and better management of bottleneck operations. The assignment method is incorporated into an organization's budgeting process, so that ...

  5. The Assignment Method: Definition, Applications, and ...

    The assignment method is a strategic approach for distributing organizational resources to specific tasks or areas. Its primary goal is to optimize resource allocation, enhance production efficiency, and maximize profits. This method finds applications in various aspects of business operations, including workforce allocation, production planning, sales territory management, and resource budgeting.

  6. Assignment Method (Hungarian Method)

    The Assignment Method is an Operations Management tool typically used for minimizing the amount of cost, time or effort by assigning tasks to the proper person. It can also be used for ...

  7. How to Solve an Assignment Problem Using the Hungarian Method

    In this lesson we learn what is an assignment problem and how we can solve it using the Hungarian method.

  8. Chapter 5: Assignment Problem

    5.1 INTRODUCTION. The assignment problem is one of the special type of transportation problem for which more efficient (less-time consuming) solution method has been devised by KUHN (1956) and FLOOD (1956). The justification of the steps leading to the solution is based on theorems proved by Hungarian mathematicians KONEIG (1950) and EGERVARY ...

  9. How to Solve the Assignment Problem: A Complete Guide

    The Hungarian method is an algorithm that uses a step-by-step approach to find the optimal assignment. The algorithm consists of the following steps: Subtract the smallest entry in each row from all the entries of the row. Subtract the smallest entry in each column from all the entries of the column. Draw the minimum number of lines to cover ...

  10. Operations Research 07D: Assignment Problem & Hungarian Method

    Textbooks: https://amzn.to/2VgimyJhttps://amzn.to/2CHalvxhttps://amzn.to/2Svk11kIn this video, we'll talk about how to solve a special case of the transporta...

  11. Solution of assignment problems (Hungarian Method)

    The cost matrix of the given assignment problem is. Column 3 contains no zero. Go to Step 2. Step 2: Select the smallest element in each column and subtract this from all the elements in its column. Since each row and column contains atleast one zero, assignments can be made. Step 3 (Assignment): Examine the rows with exactly one zero.

  12. Assignments

    How does the management of operations relate to the company's method of competing in the marketplace? 4 Inventory Management Assignment. 1. Read "A Note on Relevant Costs" and then work the two problems in the "Inventory Problems" handout. ... Critique this book as an operations management text. (Four double-spaced pages maximum for ...

  13. A Review of Case Study Method in Operations Management Research

    This article reviews the case study research in the operations management field. In this regard, the paper's key objective is to represent a general framework to design, develop, and conduct case study research for a future operations management research by critically reviewing relevant literature and offering insights into the use of case method in particular settings.

  14. Hungarian Method

    The Hungarian method is a computational optimization technique that addresses the assignment problem in polynomial time and foreshadows following primal-dual alternatives. In 1955, Harold Kuhn used the term "Hungarian method" to honour two Hungarian mathematicians, Dénes Kőnig and Jenő Egerváry. Let's go through the steps of the Hungarian method with the help of a solved example.

  15. Operations Management: Processes & Best Practices

    Operations management is the process of administering, managing, and altering business practices to boost productivity and maximize profit. Features: Features: Task management. Create tasks and subtasks, attach relevant documents, and add assignees and deadlines. Workflow management.

  16. Assignment Problem

    📒⏩Comment Below If This Video Helped You 💯Like 👍 & Share With Your Classmates - ALL THE BEST 🔥Do Visit My Second Channel - https://bit.ly/3rMGcSAThis vi...

  17. Transportation and Assignment Models in Operations Research

    Transportation and assignment models are special purpose algorithms of the linear programming. The simplex method of Linear Programming Problems (LPP) proves to be inefficient is certain situations like determining optimum assignment of jobs to persons, supply of materials from several supply points to several destinations and the like.

  18. Use the assignment method to obtain a plan that will ...

    Business Operations Management Operations Management Use the assignment method to obtain a plan that will minimize the processing costs in the following table under these conditions: a. The combination 2-D is undesirable b.

  19. Assignments

    "Quick" Case Analyses. The purpose of these assignments is to support your thinking about primarily qualitative issues raised in the course. These three write-ups (choose three from CVS, Toyota, Zara/M&S, Amazon, European Recycling, Hank Kolb, Katrina, Break.com, Barilla) should provide a point of view as to what some protagonist in the case should do given the situation faced.

  20. Assignment-Problem

    ASSIGNMENT METHOD: MINIMIZATION / MAXIMIZATION. A special case of the transportation problem in which the number of columns equals the number of rows and in which each of the sources has a supply of one unit and each of the destinations has a demand for one unit. Three basic steps in assignment method 1.

  21. Operations Management

    Course layout. Week 1:Introduction to Course, Operations Management: Objectives, OperationsManagement: Functions andScope, Types of Production Systems, Operations Strategy.Week 2:Product Life - Cycle, Value Engineering Concepts, Design for X (DFX), Ergonomics in Product Design, Rapid Prototyping: Concept, Advantages. Week 4:Facility Planning ...

  22. What is an Assignment Method?

    In accounting and finance, the assignment methodology is a technique used with allocating or association resources, costs, instead tasks among different departments, In accounting and finance, the assignment method is a technique used for allocating conversely assigning resources, costs, or tasks among others departments,

  23. (PDF) Operations Management Assignment

    Operations is the part of an organization which creates wealth through the management of the transformation process c. Operations researches mathematical techniques for optimizing processes d. Operations is the area of a business where most people work e. World class Operations can give an organization competitive advantage Q12.