StudentShare
Contact Us
Sign In / Sign Up for FREE
Search
Go to advanced search...
Free

Operational Research in Decision Making - Report Example

Cite this document
Summary
The report "Operational Research in Decision Making" analyzes the essence of operational research tools and their role in the decision-making process. Operational research is a tool to help make better decisions by using modern concepts and advanced analytical methods…
Download full paper File format: .doc, available for editing
GRAB THE BEST PAPER97% of users find it useful
Operational Research in Decision Making
Read Text Preview

Extract of sample "Operational Research in Decision Making"

Operational Research & the Decision Sciences Defining Operational research Operational research is a tool to help make better decisions by using modern concepts and advanced analytical methods. Most of the executives, who are responsible for formulating corporate decisions, use mathematical models for the analysis of complex situations, while working on the operational research theories, to achieve the desired results. The decision making and building of the systems, which can give more productive output, use operation research techniques that involve accurate prediction of outcome and risks involved, as well as the total compilation of the data available. While this will be based on the latest decision making tools and methods, all available options should be considered as input to the operation research model adopted for a particular case.......................(1) Operational research leads to decision making All business organizations would expect their executives to have enhanced decision-making capability to lead the business from the front on a gainful and productive basis. Operation research is the powerful tool to achieve this. While there are many professional tools and software available to help the business leaders for better decision making, Operation research is unique as it considers only the specific inputs and data that is applicable for a particular challenging problem, while considering the best options and information which is most beneficial for the organization. Hence, the operation research professionals customize each solution, that is unique and tailor made for the imposing challenge. Various analytical technologies are employed for achieving optimum results while using the tools for operational research. Some of these are: Simulation This method works under simulated conditions, on various theories, ideas and factors that may result in optimization of operations on cost effective basis. Optimization When the available choices are many and it is difficult to work on a particular option, the optimization technology is adopted for minimizing the risks involved, eliminating the unworkable options, while finding the best choice available. Statistics This relates to the collection of huge data concerned with the imposing challenge; categorize this data into various degrees of risk involving groups, while finding the connected information, about each group. Probability This method helps in comparing the risk management of the data collected and comparing each group This leads to testing of many options and conclusions for reaching the best solution possible...............(2) Why operational research tools are needed Business executives look out for certain signs that could tell them about an impending challenge in the organization. Some of such symptoms include: Having processing problems When a process is not working efficiently due to non decision making ability at the ground level for day to day operations, there is a need to employ operational research techniques for improving the overall efficiency of the effected process, which in turn can result in better functioning of related processes in the operational chain. This will finally help in the improvement of company bottom line. Risk troubles The assessment of risks involved while handling new projects is a very delicate job and operational research tools can help the executives to evaluate risks in terms of quantity and value. This will result in comparing the risks with the gains expected, so that a balanced output is derived that would mean minimum risk with maximum benefits. Challenges faced by the market competition While everyone in the industry would like to remain on the top by beating the stiff competition, most of the business houses in the same industry group may be already using the operational research techniques to move ahead. The use of modern technologies relevant to the market conditions while working on an O. R module can help in this direction. Complex situations pose difficult decision making challenges When the situation is so complicated that it goes beyond the control of the responsible business head, the software tools available do not help much. The operational research certainly helps in building more intelligence into the computer system and software, while tackling different aspects of the situation, in a logical manner. Operational information data is not optimized If the data covered from various sources for the operations on daily basis is not processed correctly and effectively, it is a waste of effort. Hence operational research tools guide for optimization of the data collected as well as the presentation of such data on a daily basis, to identify the flaws and errors, for their rectification.......(3) Some of the areas that can benefit from operational research Decision making Operational research helps in arriving at the most accurate and logical decision, while eliminating various options available for this purpose. Rescheduling and forecasting, with reduced costs This will mean scheduling on a fresh basis the sequence of operations, staff placement and equipment operations, within the production facility of any business unit. However, this cannot be done in an isolated manner. The rescheduling should result in cost reduction and efficient planning as well as forecasting for the future business operations. Quality improvement The quality improving techniques should be properly balanced with the cost increase to achieve the final optimization of profits. O. R helps in finding such a balance solution for the manufacturing plants. Maximum use of available resources with increased profits O.R. helps in greater utilization of resources of all kinds that include the plant equipment, work force, money and raw material etc. The resource allocation in each case is done in such a manner that it increases the product value and the profits thus obtained, while maintaining the proper quality standards. Operational research can help the business executives to take best decisions, in several ways. Some of these can be: Investment decisions Optimizing use of SAP, CRM., ERP and other software systems. Launching a new product and forecasting its sales. Planning cost effective marketing and pricing strategies. Optimizing production cycles from the same plant and equipment. Deciding on conventional sales as compared to the net based selling.....(3) Here are some of the examples of operational research tools as applied to various industrial and business functions. Resource allocation The solution for finding resource allocation to each job or function within an organization is a challenging job, which involves competitive alternatives to allocate the resources in such a manner that gives maximum profits at minimum costs. The input components for finding the O.R. solution t such problems will include the following: 1. The data on resources available, mentioned in exact figures. 2. The data on the jobs to be done, with the resources consumption demand for each job. 3. Return on the costs of resources made for each job. In case the resources available do not match with the jobs to be finished, then the cost consideration will exercise the decision fro leaving out certain unproductive jobs, due to resources crunch. Similarly, if the available resources are more than what is needed, certain portion of the funds will not be allocated after considering the cost returns. This is a rough sketch of the O.R. solution needed for resources allocation......(4) Inventory control In any industrial finance module, inventory plays the most important part, as holding of unnecessary inventory over a long time may prove hazardous to the company. Inventory includes raw materials, consumable goods, and finished products, packaging and other materials, component parts etc.. During the days of market or economic slump, there is a tendency to hold finished goods in the inventory for a longer period. However, this proves to be counter productive, quite often, as the cost of inventory control and finished goods goes higher with returns taking a plunge. Operational research solutions generally take into account the following for the effective management of inventory control. Twine bin system of controls This is also called a mi-max control system. Under this system, one bin is to accommodate the inventory for supply of current demand, while the other bin holds inventory for the replenishment demand. Whenever the first bin stocks are reduced, the order for the given quantity is automatically generated. It can also have a fixed period replenishment system, or a cyclic review system or a reorder cycle system, as all of these consist of ordering at fixed intervals to furnish the first bin. The O. R. solutions consider various combinations and permutations of the above system, keeping in view the market conditions, the financial holding capacity of the company, the cyclic production requirement etc......................(5) Manufacturing functions The operational research tools have established “manufacturing progress functions’ module and application that takes into account the qualitative and quantitative theories of mass production for any plant that produces goods in bulk. For most of the mass production lines, it has been observed that the cost of production declines with the increase in the production quantity. While, this decline is steep in the beginning of a graph thus plotted for such production pattern, the decline rate decreases until it reaches a peak from where the reversal begins. O.R. solutions take into account various factors including the inventory control, market conditions and equipment cost etc. to determine the ideal manufacturing functional pattern for any mass production unit.......(6) ________________________________________________ BIBLIOGRAPHY In-text citation references (1)Operation research, the science of better------“What Operations Research Is “ http://www.scienceofbetter.org/what/index.htm(accessed on 6th April, 2009) (2)Operation research, the science of better------“ 5 Signs You Could Benefit from Operations Research available at“ http://www.scienceofbetter.org/can_do/five_signs.htm (accessed on 6th April, 2009) (3)Operation research, the science of better------“ The Operations Research Value Proposition--Operations Research available at http://www.sThe Operations Research Value Proposition (accessed on 6th April, 2009) (4)Ackoff L Russell Operations research, Industrial engineering-- Examples of operations research models and applications » Resource allocation Available at http://www.britannica.com/EBchecked/topic/682073/operations-research/68185/New-software-tools-for-decision-making# (accessed on 9th. April,2009) (5)Eilon Samuel Operations research, Industrial engineering-- Examples of operations research models and applications » Inventory control Available at http://www.britannica.com/EBchecked/topic/682073/operations-research/68185/New-software-tools-for-decision-making# (accessed on 9th. April,2009) (6)Holstein K. William Operations research, Industrial engineering-- Examples of operations research models and applications » Manufacturing progress function Available at http://www.britannica.com/EBchecked/topic/682073/operations-research/68185/New-software-tools-for-decision-making# (accessed on 9th. April,2009) Sources used http://www.britannica.com/EBchecked/topic/682073/operations-research/68185/New-software-tools-for-decision-making# (accessed on 9th. April,2009) Operation research, the science of better------“ 5 Signs You Could Benefit from Operations Research available at“ http://www.scienceofbetter.org/can_do/five_signs.htm (accessed on 6th April, 2009) Read More
Cite this document
  • APA
  • MLA
  • CHICAGO
(Operational Research in Decision Making Report Example | Topics and Well Written Essays - 1500 words, n.d.)
Operational Research in Decision Making Report Example | Topics and Well Written Essays - 1500 words. https://studentshare.org/management/1553574-operational-research-the-decision-sciences
(Operational Research in Decision Making Report Example | Topics and Well Written Essays - 1500 Words)
Operational Research in Decision Making Report Example | Topics and Well Written Essays - 1500 Words. https://studentshare.org/management/1553574-operational-research-the-decision-sciences.
“Operational Research in Decision Making Report Example | Topics and Well Written Essays - 1500 Words”. https://studentshare.org/management/1553574-operational-research-the-decision-sciences.
  • Cited: 0 times

CHECK THESE SAMPLES OF Operational Research in Decision Making

Leadership in Teams and Decision Groups

Organizations have thus replaced individuals who had the authority to make decisions and granted teams the duty of making the decisions and executing tasks.... LEADERSHIP IN TEAMS AND decision GROUPS DATE Nature of teams The increasing use of teams in most organizations makes the team leadership an important area for research.... The representatives from the various units should be persons with expertise to help add value to the team's decision....
5 Pages (1250 words) Research Paper

Value and Drawbacks of Activity Based Management

Its main aim is to analyze cost of processes for informed decision making into reduced operational cost at maximized customer utility levels.... VALUE AND DRAWBACKS OF ACTIVITY-BASED MANAGEMENT Name: Institution: Introduction Activity based management refers to a management approach that applies activity based costing designed for decision-making and development of organizational strategies.... Activity based management uses the data and information on all the operational activities in making relevant and result oriented decisions....
5 Pages (1250 words) Research Paper

Dell Computer Corporation

In general, the role of MIS in terms of a DSS is to analyze and process business data that will aid business decision making efficiently (Nowduri, 2011).... Moreover, MIS can be further categorized as decision Support System (DSS) and Executive Information System (EIS).... Similarly, apart from the strong brand value and robust market position, there are flaws in some product segments along with feeble research and development outputs.... hellip; operational layer, strategic layer and tactical layers of Dell incorporated....
3 Pages (750 words) Research Paper

Operations Decision

The managers need to develop the skills of handling all the operational problems that arise during the course of decision making.... y in the case is the operational research method as it is the most scientific method of identifying the problems that arise in the management of operations of the business that comprise of employees, machines, material, resources along with macro environment factors such as government, defense, business and industry (Banarjee, 2012)....
6 Pages (1500 words) Research Paper

The Totality of the Operations in All Aspect of the Business

The paper describes operations management.... It focuses carefully on the processes of management producing and distributing such products and services.... In small businesses, the operations manager is not an issue but the carrying of the activities in terms of typically schools' management.... hellip; The overall activities may include the creation of the product, its development, the production and distribution as well but the management of production may be regarded as one or the more closely in relation to such product and the management of operations may even regard as the operations that are absolutely within the organization....
14 Pages (3500 words) Research Paper

Globally Optimized Operations

This research paper explains the globally optimized operations.... It is preferably important to ensure that all budget considerations, logistical operational goals and other relevant optimal operations factors are put in place.... The complexity and dynamic nature of today's business world presents a variedly increased operating drawbacks for companies aiming at achieving sustainability while promotionally working with a chain of with globally established trading partners, regulators, risk management… Globally, optimized operations aim at controlling the challenges of supply chain management....
5 Pages (1250 words) Research Paper

Impact of Financial Decision Making of State Owned Oil Companies

The paper "Impact of Financial decision making of State Owned Oil Companies" discusses that it should be noticed that in all industrial sectors there are companies that face severe difficulties in order to adapt their financial projects in their strategic plans.... On the other hand, the financial management of privately-owned companies will also be reviewed trying to locate any particular characteristics as well as any explanations for its influence by the financial decision-making process followed by the state-owned oil companies....
7 Pages (1750 words) Research Proposal

Human Factors Considerations in the Vision for the Development of Nextgen

The characteristics for NextGen include: an emphasis on user focus, with provision of greater flexibility and information for users and reduction of government intervention and control of resources; distributed decision making, enabling decision making at local levels based on an environment with rich information exchange and tools for creating shared situational awareness; leverage on human and automation capabilities by using automation to acquire, compile, monitor, evaluate and exchange information, and allowing humans choose alternatives and make decisions; being scalable on  daily and yearly time-scales to satisfy changing traffic load and demand; being robust and resilient with inbuilt contingency measures, such as “fail-safe” automation modes not relying fully on human cognition as backup; integration of safety management to manage the system, organizational and operational risk proactively; provision of environmental management framework to include technology, policies, and procedures to minimize environmental issues, such as community noise, air quality, water quality, energy utilization, and climate change....
11 Pages (2750 words) Research Paper
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.
Contact Us