Industrial Business Management -The Operations Research as a Management Tool - Essay Example

?Topic:  Industrial Business Management -The operations research as a management tool The operations research as a new science was born fifteen yearsago. As an infant it helped win “World War II”. It matured during the Korea conflict and today it holds tremendous hope for the future as a new and effective tool of management. However, because it developed under a shroud of military secrecy few people know of it. Its purpose is to provide an executive with more precise information, enabling him to make decisions which are correct for his organizations. Although new as a separate discipline, operations research is an extension of principles which has been widely used in scientific management for many years. Not a cure –all, it has definite limitations- just as it has great possibilities and excellent record of accomplishments. Operations research broadens and formalizes the basic principles of scientific management and uses the methods long applied to problems in physical science. When a business man faced with a marketing problem that involves variables employs algebra to calculate the best time to sell his product, he is using the operations research approach. Instead of studying insects, or atoms, or heart diseases, like most sciences, operations research studies men and machines in action. And it employs the talents of a team of scientists, rather than man. Operations research teams include physicist, political scientist, mathematician, economists, engineers, psychologists, and on down the line of practically every science- physical, biological, social or human. Faced with a problem, an operations research team gathers every piece of information which bears on the situation. These dates are translated into mathematical terms by using the tools of algebra and calculus, differential equations, geometry, statistics, and symbolic logic, among others. What is appalling to layman, however makes good sense to the operations research specialist. This information is fed into the electronic computers and the result is an actual model of the organization under study- a mathematical code. The computer then can be directed to simulate mathematically any situation which might take place in the organization. In an afternoon it can reproduce activities which might take years to unfold naturally. Operations research does not have to include mathematics however, it can be simple too. Operations research is therefore, is an applied science utilizing all known scientific techniques as tools in solving a specific problem. It is likely however that the operations research should not be classed as a branch of engineering. It is an organized activity with more or less defined methodology of attacking new problems and finding definite solution. The operations research technique is most useful in military operations than in non – military operations. The most important single mathematical tool of operations research is probability and statistical theory. The data upon which the research is based will come, for the most part, from statistical studies of operations. Statistical analysis is part of the observational aspect of operations research. The operations research is successfully practiced in military operations One of the classical example is that of depth setting of a ‘depth charge’ (a kind of bomb used for underwater explosion at pre – specified depths) to be dropped by an aircraft against submarines. Initially, the attacks were unsuccessful as the submarines were reported sunk. Using available data and simple analysis it became clear that if the depth setting was reduced and the pilots were instructed not to drop the depth charge if the submarines had already submerged for more than half a minute, one would expect the average number of submarine sunk for a given number of attacks by more than two times. Thus there was no need to develop and influence fuze to improve the effectiveness of depth charge. This recommendation was accepted and implemented. Subsequently, enemy intelligence reported that perhaps a much more powerful depth charge had been put into operation , which enabled the causalities of the submarines by more than two times. Another example is when an operations analyst for an auto manufacturer may be asked to determine the best inventory level for each of the parts needed on a production line and to ascertain the optimum number of windshield to be kept in the stock. Too many windshields would be wasteful and expensive, where as too few could halt productions. Analyst will study the problem, break it into components. They would gather information from variety of sources. To determine the optimal inventory, an operations research analyst might talk with engineers about production levels, discuss purchasing arrangement with buyers, and examine storage - cost data provided by the accounting department. During the war operations research proved its worth in military applications, and today the services, both in United States and England, are provided with group attached to the planning and operational parts of the higher staffs. First of all operations research is a scientific method. Since the operation research is to provide the executive with a quantitative basis for decision, it is easy to see that techniques of presentation is of a result are very important parts of the activity. The word “operations” in definition itself requires definition. Its use in military terminology is quiet specific, but this usage differs somewhat from that current in industrial or other government activities. The term “operation” implies to some extent a repetition of some action or some parts of an action. An operations research groups should not report to the research department of a military service or of an industrial organization for example. It must have direct and personal contact with the officer who makes the executive decisions; so that the group can know from him what are the important questions requiring decisions so that he can hear directly from them the result of their studies, which are to form a basis for his decisions. The operations research worker need not be an expert in the operations involved but he must have enough technical background to understand the fundamentals of the opearions, enough mathematical ability to carry out the analysis involved, and, above all, the sort of impersonal curiosity that is the prime requisite of any scientific research worker. Read More