MB0048 –Operation ResearchQ1. a. Explain how and why Operation Research methods have been valuable in aidingexecutive decisions.b. Discuss the usefulness of Operation Research in decision making process and the role of computers in this field.Ans.
Churchman, Aackoff and Aruoff defined Operations Research as:
the application of scientificmethods, techniques and tools to operation of a system with optimum solutions to the problems
refers to the best possible alternative.The objective of Operations Research is
to provide a scientific basis to the decision-makers for solving problems involving interaction of various components of the organisation. You canachieve this by employing a team of scientists from different disciplines, to work together for finding the best possible solution in the interest of the organisation as a whole.
The solution thusobtained is known as an optimal decision.You can also define Operations Research as
The use of scientific methods to provide criteria for decisions regarding man, machine, and systems involving repetitive operations
“OperationTechniques is a bunch of mathematical techniques.”
b. “Operation Research is an aid for the executive in making his decisions based onscientific methods analysis”. Discuss the above statement in brief.Ans.
“Operation Research is an aid for the executive in making his decisions based on scientificmethods analysis”.
Any problem, simple or complicated, can use OR techniques to find the best possible solution.This section will explain the scope of OR by seeing its application in various fields of everydaylife.i)
In Defense Operations:
In modern warfare, the defense operations are carried out by threemajor independent components namely Air Force, Army and Navy. The activities in each of these components can be further divided in four sub-components namely: administration,intelligence, operations and training and supply. The applications of modern warfare techniquesin each of the components of military organisations require expertise knowledge in respectivefields. Furthermore, each component works to drive maximum gains from its operations andthere is always a possibility that the strategy beneficial to one component may be unfeasible for another component. Thus in
strategies of different components. After appropriate analysis of the various courses of actions, the team selects the best course of action, known as the ‘optimum strategy’.
ii) In Industry:
The system of modern industries is so complex that the optimum pointof operation in its various components cannot be intuitively judged by an individual.The business environment is always changing and any decision useful at one time maynot be so good sometime later. There is always a need to check the validity of decisionscontinuously against the situations. The industrial revolution with increased division of labor and introduction of management responsibilities has made each component anindependent unit having their own goals. For example: production departmentminimizes the cost of production but maximise output. Marketing departmentmaximizes the output, but minimizes cost of unit sales. Finance department tries tooptimize the capital investment and personnel department appoints good people atminimum cost. Thus each department plans its own objectives and all these objectivesof various department or components come to conflict with one another and may notagree to the overall objectives of the organization. The application of OR techniqueshelps in overcoming this difficulty by integrating the diversified activities of variouscomponents to serve the interest of the organization as a whole efficiently. OR methodsin industry can be applied in the fields of production, inventory controls and marketing, purchasing, transportation and competitive strategies.
In modern times, it has become necessary for every government to havecareful planning, for economic development of the country. OR techniques can befruitfully applied to maximise the per capita income, with minimum sacrifice and time.A government can thus use OR for framing future economic and social policies.
With increase in population, there is a need to increase agriculture output. But thiscannot be done arbitrarily. There are several restrictions. Hence the need to determine acourse of action serving the best under the given restrictions. You can solve this problem by applying OR techniques
v) In Hospitals
:OR methods can solve waiting problems in out-patient department of big hospitals andadministrative problems of the hospital organizations.
You can apply different OR methods to regulate the arrival of trains and processingtimes minimize the passengers waiting time and reduce congestion, formulate suitabletransportation policy, thereby reducing the costs and time of trans-shipment.
vii) Research and Development:
You can apply OR methodologies in the field of R&D for several purposes, such as tocontrol and plan product introductions.