Chapter 15

Goal Programming

What is Goal Programming?

Mathematical model similar to Linear Programming, however it allows for multiple goals to be satisfied at the same time. Allows for the multiple goals to be prioritized and weighted to account for the DMs utility for meeting the various goals.

Assumptions

Similar to LP:

Non-negative variables Conditions of certainty Variables are independent Limited resources Deterministic

Components

Economic Constraints

Physical Concerned with resources Cannot be violated Example: # of production hours each week

Components

Goal Constraints

Variable Concerned with target values Can be changed/modified Example: Desire to achieve a certain level of profit

Components

Objective Function

Minimizes the sum of the weighted deviations from the target values this is ALWAYS the objective for Goal Programming Not the same as LP (which was maximize revenue/minimize costs)

Goal Programming Steps

Define decision variables Define Deviational Variable for each goal Formulate Constraint Equations

Economic constraints Goal constraints

Formulate Objective Function

Goal Programming Terms

Decision Variables are the same as those in LP formulations (represent products, hours worked) Deviational Variables represent overachieving or underachieving the desired level of each goal

d+ Represents overachieving level of the goal d- Represents underachieving level of the goal

Goal Programming Constraints

Economic Constraints

Stated as <=, >=, or = Linear (stated in terms of decision variables) Example: 3x + 2y <= 50 hours General form of goal constraint:
Decision Variables

Goal Constraints

- d+ + d-

Desired Goal Level

Goal Programming Example

Microcom is a growth oriented firm which establishes monthly performance goals for its sales force Microcom determines that the sales force has a maximum available hours per month for visits of 640 hours Further, it is estimated that each visit to a potential new client requires 3 hours and each visit to a current client requires 2 hours

Goal Programming Example

Microcom establishes two goals for the coming month:

Contact at least 200 current clients Contact at least 120 new clients

Overachieving either goal will not be penalized

Goal Programming Example

Steps Required:
1. Define the decision variables 2. Define the goals and deviational variables 3. Formulate the GP Models Parameters:
Economic Constraints Goal Constraints Objective Function

4. Solve the GP using the graphical approach

Goal Programming Example

Step 1: Define the decision variables:

X1 = the number of current clients visited X2 = the number of new clients visited

Step 2: Define the goals:

Goal 1 Contact 200 current clients Goal 2 Contact 120 new clients

Goal Programming Example

Step 3: Define the deviational variables

d1+ = the number of current clients visited in excess of the goal of 200 d1- = the number of current clients visited less than the goal of 200 d2+ = the number of new clients visited in excess of the goal of 120 d2- = the number of new clients visited less than the goal of 120

Goal Programming Example

Formulate the GP Model: Economic Constraints:

2X1 + 3X2 <= 640 (note: can be <, =, >) X1, X2 => 0 d1+, d1-, d2+, d2- => 0 Current Clients: X1 + d1- - d1+ = 200 New Clients: X2 + d2- - d2+ = 120

Goal Constraints:

Must be =

Goal Programming Example

WebNet establishes two goals for the coming month:

Contact at least 200 current clients Contact at least 120 new clients

Overachieving either goal will not be penalized

Goal Programming Example

Objective Function:

Minimize Weighted Deviations Minimize Z = d1- + d2-

Goal Programming Example

Complete formulation:

Minimize Z = d1- + d2Subject to: 2X1 + 3X2 <= 640 X1 + d1- - d1+ = 200 X2 + d2- - d2+ = 120 X1, X2 => 0 d1+, d1-, d2+, d2- => 0

Goal Programming Example

Graph constraint: 2X1 + 3X2 = 640

If X1 = 0, X2 = 213 If X2 = 0, X1 = 320

Plot points (0, 213) and (320, 0)

Graphical Solution
X2
(0,213)

200

150
100

50
(320,0)

50

100

150

200

250

300 350

X1

Goal Programming Example

Graph deviation lines

X1 + d1- - d1+ = 200 (Goal 1) X2 + d2- - d2+ = 120 (Goal 2)

Plot lines for X1 = 200, X2 = 120

Goal Programming Example

X2
(0,213)

Goal 1 d1d1+ d2+ Goal 2

(140,120) (200,80)

200

150
100

d2-

50
(320,0)

50

100

150

200

250

X1 300 350

Solving Graphical Goal Programming

Want to Minimize d1- + d2So we evaluate each of the candidate solution points:
For point (140, 120) d1- = 60 and d2- = 0 Z = 60 + 0 = 60

Optimal Point

For point (200, 80) d1- = 0 and d2- = 40 Z = 0 + 40 = 40

Contact at least 200 current clients Contact at least 120 new

Goal Programming Solution

X1 = 200 X2 = 80 d1+ = 0 d1- = 0 Z = 40

Goal 1 achieved Goal 2 not achieved d2+ = 0 d2- = 40

For Next Class

Complete reading Goal Programming pages (thru 727& Do Goal Programming HWs