Businesses face various types of problems that require making optimal decisions in order to achieve a certain objective. One such problem is the transportation / assignment problem I came across when I was reading the excellent “Spreadsheet Modeling and Decision Analysis” book by Cliff T. Ragsdale. I found this type of problem interesting because the concept can be generalized to many areas of the business.
In this post, I will discuss a transportation / assignment problem scenario where we need to select the optimal supply sources & routes that would meet as much of the demand as possible while minimizing the cost of shipping.