OR Process

Operation Research as

a scientific method

Introduction

• _{Operation Research is the application of scientific methods,}

techniques, and tools to problems involving the operations of a system so as to provide those in control of the system with optimum solutions to the problems

• _{It seeks to observe, understand, and predict the behavior of}

Historical perspectives

• _{The subject of operation research was born during Second World War}

in U.K., and was used for military strategy.

• _{During World War II, a group of scientists, having representatives from}

mathematics, statistics, physical and social sciences were entrusted to the study of various military operations.

• _{This team was very success ful and greatly contributed to the}

Model

• _{Operation Research model is an idealized representation of the real}

life situation and repre sents one or more aspects of reality.

• _{Examples of operation research models are: a map, activity charts}

balance sheets, PERT network, break-even equation, economic ordering quantity equation etc.

• _{Objective of the model is to provide a means for analyzing the}

The Model of an Operating Problem

• _{Models play an important role in operation research}

• _{It provides description and explanation of the operation of the system} • _{There are three components of an operation research model:}

• _{The criterion or pay-off function} • _{The decision-variables}

Example

• _{For instance in linear programming, a typical mathematical program}

Properties of a model

• _{A model should be:}

• _simple,

• _{capable of adjustments,} • _{contain very few variables,}

Models of Operation Research

1. Linear programming. 2. Queuing theory.

3. Dynamic programming. 4. Decision theory.

Phases of OR

Judgmen

Judgment phase

• _{Determination of operation.} • _{Determination of objectives.}

• _{Determination of effectiveness of measures.}

Research phase

• _{Observation and data collection for better understanding of the}

problem.

• _{Formulation of relevant hypothesis and models.}

• _{Analysis of available information and verification of hypothesis.}

• _{Production and generation of results and consideration of}

Action phase

• _{Recommendations for remedial action to those who first posed the}

problem, this includes the assumptions made, scope and limitations, alternative courses of ac tion and their effect.

Inter-Disciplinary Team Approach

• _{Operations research may be characterized by rather unusual}

combinations of disciplines on research teams and by the use of varied research procedures.

• _{This requires an inter-disciplinary team includ ing individuals with skills}

Holistic Approach to the System

• _{While evaluating any decision, the important interactions and their}

Methodological Approach

• _{Operation research utilizes the scientific method to solve the problem} • _{Most operation research studies cannot be conducted in laboratories,}

and the findings cannot be applied to natural environments.

• _{Therefore, scientific and mathematical models are used for studies.}

Objective Approach

• _{Operation research attempts to find the best or optimal solution to}

the prob lem under consideration, taking into account the goals of the organization

• _{It requires a measure of the effectiveness based on the objectives of}

Formulating the problem

• _{The problem must be first clearly defined.}

• _{It is common to start the operation research study with tentative}

formulation of the problem, which is reformulated over and again during the study.

• _{While formulating the operation research study, analysts must analyze}

following major components:

• _{The environment} • _{Decision-makers} • _Objectives

Develop the model

• _{Once the project is approved by the management, the next step is to}

construct a model for the system under study.

• _{The operation researcher can now construct the model to show the relations}

and interrelations between a cause and effect or between an action and a reaction.

• _{Now the aim of operation researcher is to develop a model which enables him}

to forecast the effect of factors crucial to the solution of given problem.

• _{The proposed model may be tested and modified in order to work under}

stated environmental constraints.

• _{A model may also be modified if the management is not satisfied by its}

Deriving Solution

• _{A solution may be extracted form a model either by conducting}

experiments on it i.e. by simulation or by mathematical analysis.

• _{Mathematical analysis for deriving optimum solution includes ana lytical}

or numerical procedure, and uses various branches of mathematics

• The date collection can clearly effect the models output significantly.

• Operation researcher should not assume that once he has defined his objective and model, he has achieved his aim of solving the problem.

• _{The required data collection consumes time to prepare if data}

Testing the Model and Solution

• _{A properly formulated and correctly manipulated model is useful in}

predicting the effect of changes in control variables on the overall system effectiveness.

• _{The validity of the solution is checked by comparing the results with}

Establishing Controls over the

Solution

• _{The next phase for the operation researcher is to explain his findings}

to the management.

• _{It may be pointed out that he should specify that condition under}

which the solution can be utilized.

• _{He should also point out weaknesses if any so that management will}

know what risks they are taking while employing the model to generate results.

• _{Thus he should also specify the limits with in which the results}

Implementing the Solution

• _{The last phase of the operation research methodology is}

implementation of solutions obtained in the previous steps.

• _{In operation research though decision making is scientific but its}

implementation involves so many behavioral issues.

• _{Therefore the implementing authority has to resolve the behavioral}

Applications of operation research

• _{Operation research is a problem solving and decision taking}

technique.

• _{It is considered a kit of scientific and programmable rules which}

provides the management a “quantitative basis” for decisions concerning the operation under its control.

• _{Some areas of management where operation research techniques}

Allocation and Distribution in

Projects

• _{Optimal allocation of resources such as men materials machines, time}

and money to projects.

Production and Facilities Planning

• _{Factory size and location decision.}

• _{Estimation of number of facilities required.}

• _{Preparation of forecasts for the various inventory items and}

computation of economic order quantities and reorder levels.

• _{Scheduling and sequencing of production runs by proper allocation of}

machines.

• _{Transportation loading and unloading} • _{Warehouse location decision.}

Program’s Decisions

Marketing

• _{Advertising budget allocation.} • _{Product introduction timing.} • _{Selection of advertising media.} • _{Selection of product mix.}

• _{Customer’s preference of size, colour and packaging of various}

Organization Behavior

• _{Selection of personnel, determination of retirement age and skills.} • _{Recruitment policies and assignment of jobs.}

• _{Recruitment of employees.}

Finance

• _{Capital requirements, cash flow analysis.} • _{Credit policies, credit risks etc.}

• _{Investment decision.}

Research and development

• _{Product introduction planning.} • _{Control of R&D projects.}

• _{Determination of areas for research and development.} • _{Selection of projects and preparation of their budgets.}

• _{Reliability and control of development projects thus it may be}

Operation Research in Defense

• Operations Research (OR) was first used during World War II to assist high level decision makers with analyses that could be used to support planning for strategic ground, air, and maritime operations.

• The Military Operations Research Society (MORS) is a society for professionals active within defense applications of operations research (OR) in the United States

Operation Research in Defense –

cont…

• _{Operation research can be used for operational testing of weapons and equipment}

and the modelling force-on-force military conflicts.

• _{The commanders and strategists in Afghanistan needed robust analytic techniques}

to defeat the Improvised Explosive Devices (or IED) threat that was inflicting casualties to deployed coalition forces. One problem that was solved using OR techniques was planning and scheduling of route clearance missions.

• _{A probability based model was used for delineating the IED activities on the}

systems of roads used by coalition forces.

• _{Potential route clearance missions were generated using dynamic programming}

• _{Operations research techniques has been used to determine the costs}

associated with the development, procurement, and operating and support costs associated with Navy and Marine Corps air combat platforms.

• _{Mathematical models allow to run real-world scenarios to determine}

1. Which of these is not a component of a model:

a. The criterion or pay-off function b. The decision-variables

c. The constraints

2. A good model should not be: a. Adaptable

b. Limited to few variables

3. Which of the following is not a model of operation research? a. Linear programming

4. Operation research is a: a. Team approach

5. Operation research requires a scientific approach for solution. a. True