NATURE AND SCOPE OF OPERATION RESEARCH

• NATURE AND SCOPE OF OPERATION RESEARCH
• OPERATION RESEARCH
• BY DR. SHASHI AGGARWAL ( UPDATED VIDEO WILL BE UPLOADED SHORTLY)
• INTRODUCTION

1. SIMPLY BE VIEWED AS A SYSTEMATIC AND ANALYTICAL APPROACH TO DECISION MAKING AND PROBLEM SOLVING
2. O.R. AS TERMED IN THE USA,CANADA ,AFRICA,AUSTRALIA AND OPERATIONAL RESEARCH AS TERMED IN THE EUROPE IS AN INTER DISCIPLINARY BRANCH OF APPLIED MATHEMATICS THAT USE TECHNIQUES AND STATISTICS TO ARRIVE AT OPTIMAL OR NEAR OPTIMAL SOLUTIONS TO COMPLEX PROBLEMS
3. IT IS DISTINCT DISCIPLINE AND BUT IT HAS BECOME AN INTEGRAL PART OF INDUSTRIAL ENGINEERING PROFESSION
4. SOME OF THE PRIMARY TOOLS USED ARE STATISTICS,PROBABILITY THEORY,GAME THEORY,GRAPH THEORY,DECISION THEORY AND OPTIMIZATION,

• HISTORY

1. IT IS GENERALLY ACCEPTED THAT THE FIELD ORIGINATED IN ENGLAND DURING WORLD WAR II. CHARLES BABBAGE( 1791 -1871) IS THE FATHER OF OPERATION RESEARCH BECAUSE HIS RESEARCH INTO THE COST OF TRANSPORTATION AND SORTING OF MAIL LED TO ENGLAND’S UNIVERSAL PENNY POST IN 1840
2. MODERN OPERATION RESEARCH ORIGINATED AT THE BOWDSY RESEARCH STATION IN UK IN 1937 TO ANALYZE AND IMPROVE THE WORKING OF THE UK’S EARLY WARNING RADAR SYSTEM.
3. IN INDIA OR SOCIETY FOUNDED IN1959 ALSO BECAME A MEMBER OF INTERNATIONAL FEDERATION OF OR SOCIETIES IN1959 AND THE JOURNAL OPSEARCH WAS PUBLISHED FOR THE FIRST TIME IN 1963.

• NATURE OF OPERATION RESEARCH

1. MAY BE VIEWED AS A SYSTEMATIC AND ANALYTICAL APPROACH TO DECISION MAKING AND PROBLEM SOLVING. IT HELPS TO SEEK OPTIMAL SOLUTION TO A PROBLEM.
2. C.W. CHURCHMAN “ OPERATION RESEARCH IS THE APPLICATION OF SCIENTIFIC TECHNIQUES AND TOOLS TO PROBLEMS INVOLVING THE OPERATION OF A SYSTEM SO AS TO PROVIDE THOSE IN CONTROL OF THE SYSTEM WITH THE OPTIMAL SOLUTION TO THE PROBLEM.
3. P.H MORSE AND G.E. KIMBALL:OPERATION RESEARCH ISA SCIENTIFIC METHOD OF PROVIDING EXECUTIVE DEPARTMENTS WITH A QUANTITATIVE BASIS FOR DECISION REGARDING THEIR OPERATION UNDER THEIR CONTROL

• FEATURES
• SYSTEM ORIENTATION. STUDIES THE PROBLEM INTO WHOLE: - STUDIES THE PROBLEM AS A WHOLE. THIS MEANS THAT ANY ACTION OR ACTIVITY HAS SAME EFFECT ON THE OTHER PART OF THE ORGANIZATION. THE OPTIMUM RESULT OF ONE PART OF A SYSTEM MAY NOT BE THE OPTIMUM FOR SOME OTHER PART.
• INTERDISCIPLINARY TEAM APPROACH:-PERFORMED BY A TEAM OF SCIENTISTS WHOSE INDIVIDUAL MEMBERS HAVE BEEN DRAWN FROM DIFFERENT SCIENTIFIC AND ENGINEERING DISCIPLINE
• SCIENTIFIC APPROACH:-IS FORMALIZED PROCESS OF REASONING AND UNDER THE OR PROBLEM IS TO BE ANALYZED AND DEFINED CLEARLY

• DECISION MAKING:-DECISION SCIENCE WHICH HELPS THE MANAGEMENT TO MAKE BETTER DECISIONS. DECISION MAKING IS A SYSTEMATIC PROCESS AND CONSISTS OF THE FOLLOWING STEPS: - DIAGNOSE, SELECT THE ALTERNATIVES AND DETERMINE THE MODEL TO BE USED, EVALUATION AND SELECTING THE BEST AND THE OPTIMUM ALTERNATIVES.
• USE OF COMPUTERS:-
• OBJECTIVES: BEST AND THE OPTIMAL SOLUTION
• QUANTITATIVE SOLUTIONS
• HUMAN FACTORS

• SCOPE
• FINANCE,BUDGETING AND INVESTMENTS:-
• CASH FLOW ANALYSIS, LONG RANGE CAPITAL REQUIREMENTS, INVESTMENT PORTFOLIOS, DIVIDEND POLICIES.

·         PURCHASING AND PROCUREMENT AND EXPLORATION:

1. DETERMINING THE QUANTITY AND TIMING OF PURCHASE OF RM,MACHINERY ETC
2. RULES FOR BUYING AND SUPPLIER UNDER VARYING PRICES
3. BIDDING POLICIES
4. EQUIPMENT REPLACEMENT POLICIES
5. DETERMINATION OF QUANTITIES AND TIMING OF PURCHASE

• PRODUCTION MANAGEMENT:-

1. PROJECT PLANNING: LOCATING AND SIZE OF WAREHOUSES,DISTRIBUTION CENTRES,RETAIL OUTLET ETC
2. DISTRIBUTION POLICY

3.     MANUFACTURING AND FACILITY PLANNING:-

4. PRODUCTION SCHEDULING AND SEQUENCING
5. PROJECT SCHEDULING AND ALLOCATION OF RESOURCES
6. SELECTION AND LOCATION OF FACTORIES ,WAREHOUSE AND THEIR SIZES
7. DETERMINING THE OPTIMAL PRODUCTION MIX
8. MAINTENANCE CREW SIZES
9. SCHEDULING AND SEQUENCING THE PRODUCTION RUN BY PROPER ALLOCATION OF MACHINES

• MARKETING MANAGEMENT:-

1. PRODUCT SELECTION,TIMING AND COMPETITIVE ACTIONS
2. ADVERTISING STRATEGY AND CHOICE OF DIFFERENT MEDIA OF ADVERTISING
3. NUMBER OF SALESMEN,FREQUENCY OF CALLING OF ACCOUNTS
4. EFFECTIVENESS OF MARKET RESEARCH
5. SIZE OF THE STOCK TO MEET THE FUTURE DEMAND

·         PERSONNEL MANAGEMENT:-

1. RECRUITMENT POLICIES AND ASSIGNMENT OF JOBS
2. SELECTION OF SUITABLE PERSONNEL WITH DUE CONSIDERATION FOR AGE AND SKILL
3. ESTABLISHING EQUITABLE BONUS SYSTEM

• RESEARCH AND DEVELOPMENT:-
• DETERMINING OF AREAS OF CONCENTRATION OF RESEARCH AND DEVELOPMENT
• RELIABILITY AND EVALUATION OF ALTERNATIVE DESIGNS
• CONTROL OF DEVELOPMENT PROJECT
• CO—ORDINATION OF MULTIPLE RESEARCH PROJECT
• DETERMINING OF TIME AND COST REQUIREMENTS
• TYPES OF OPERATION RESEARCH MODELS
• A MODEL IS A REPRESENTATION OF REALITY.
• PHYSICAL MODEL: - ALL FORMS OF DIAGRAMS, DRAWING, GRAPHS AND CHART.
• ICONIC MODELS –IMAGE OR LIKENESS OF AN OBJECT
• ANALOG MODELS :- CLOSELY ASSOCIATED WITH ICONIC MODELS
• MATHEMATICAL MODELS
• DETERMINISTIC MODELS
• PROBABILISTIC MODELS
• GENERAL MODELS
• SPECIFIC MODELS

• TOOLS OF OPERATION RESEARCH
• LINEAR PROGRAMMING: THIS TECHNIQUE IS USED TO FIND THE SOLUTION FOR OPTIMIZING A GIVEN OBJECTIVE. OBJECTIVE MAY BE MAXIMIZING OR MINIMIZING COST. LINEAR PROGRAMMING TECHNIQUE INVOLVE PRODUCT MIX AND DISTRIBUTING PROBLEMS OF ENTERPRISES. LPP USED TO ALLOCATE SCARCE RESOURCES IN AN OPTIMUM MANNER IN PROBLEM OF SCHEDULING.
• QUEUING THEORY:DEALS WITH THE SITUATIONS IN WHICH QUEUE IS FORMED AND DIFFERENT TYPES OF SITUATIONS IN WHICH QUEUE IS FORMED FOR EG CUSTOMERS,WAITING FOR SERVICE,MACHINE WAITING FOR REPAIRING AND AIRCRAFT WAITING FOR LANDING.MINIMIZING THE OVER ALL COST DUE TO SERVICING AND WAITING.

• INVENTORY CONTROL MODELS:INVENTORY CONTROL HELP IN DECIDING REORDERING QUANTITY,REORDERING LEVEL AND OPTIMAL ORDERING QUANTITY.
• NETWORK ANALYSIS: THIS MODEL HELPS THE MANAGERS TO DETERMINE THE TOTAL PROJECT COMPLETION TIME, PROBABILITY THAT A PROJECT WILL COMPLETED BY A CERTAIN DATE, LEAST COST WAY OF SHORTENING TOTAL PROJECT COMPLETION TIME. PERT AND CPM AND OTHER NET WORKING SUCH AS GANTT CHART.
• REPLACEMENT PROBLEMS:-THE THEORY OF REPLACEMENT IS CONCERNED WITH SITUATIONS THAT ARISE WHEN SOME TIMES SUCH AS MACHINES, MEN, ELECTRIC LIGHTS BULB OR ANY OTHER EQUIPMENT REPLACEMENT DUE TO THEIR DECREASING EFFICIENCY, FAILURE OR BREAK DOWN. IT HELPS TO SOLVE ALL REPLACEMENT PROBLEM,

• SEQUENCING: MODEL HAVE BEEN DEVELOPED TO FIND A SEQUENCE FOR PROCESSING JOBS SO THE TOTAL ELAPSED TIME FOR ALL THE JOBS WILL BE MINIMUM. ALSO HELPS  TO RESOLVE THE CONFLICT BETWEEN THE OBJECTIVE OF MAXIMIZING THE MACHINE UTILIZATION AND COMPLYING WITH PREDETERMINED OBJECTIVES
• INTEGER PROGRAMMING: INTEGER MEANS COMPLETE OR WHOLE NUMBER. MAJOR LIMITATION OF LINEAR MODELING IS THE ASSUMPTIONS THAT ALL THE VARIABLES CAN TAKE ANY VALUES MAY BE DECIMAL OR FRACTIONS. BY USING THE INTEGERS PROGRAMMING ALGORITHM A SERIES OF CONTINUOUS LINEAR PROGRAMMING ARE SOLVED SUCH A WAY THAT SOLUTION CONTAINING UNACCEPTABLE INTEGER VALUES ARE RULES OUT AND BEST HIGHER PROGRAMMING SOLUTION IS OBTAINED.

• ASSIGNMENT PROBLEMS:-SPECIAL TYPE OF LINEAR PROGRAMMING PROBLEM. DEALS IN ALLOCATING THE VARIOUS RESOURCES OF ITEMS TO VARIOUS ACTIVITIES ON ONE TO ONE BASIS IN SUCH A WAY THAT THE TIME OR COST INVLVED IS MINIMIZE.SALE OR PROFIT IS MAXIMIZED.
• TRANSPORT PROBLEMS:- DEALS WITH THE TRANSPORTATION OF PRODUCT FROM  A NUMBER OF SOURCES WITH LIMITED SUPPLIES TO A NUMBER OF DESTINATIONS WITH SPECIFIED DEMAND AT THE MINIMUM TOTAL TRANSPORTATION COST.THE MAIN OBJECTIVE IS TO SCHEDULE SHIPMENT FROM SOURCES TO DESTINATION IN SUCH A WAY AS TO MINIMIZE THE TOTAL TRANSPORT COST

• DECISION THEORY AND GAMES THEORY:-PRIMARILY CONCERNED WITH DECISION MAKING UNDER CONDITIONS OF RISK AND UNCERTAINTY. WITH DECISION THEORY AND GAME THEORY ASSIST THE DECISION MAKER IN ANALYZING PROBLEMS WITH NUMEROUS ALTERNATIVES COURSES OF ACTION ON THE BASIS OF THE ABOVE TECHNIQUES.THE GAME THEORY ASSISTS THE DECISION MAKER TO HAVE THE KNOWLEDGE OF COURSES OF ACTION AVAILABLE TO HIS OPPONENT. IN DECISION THEORY WE USE DECISION TABLES AND DECISION TREES WHICH CAN BE USED GRAPHICALLY REPRESENT AND SOLVE DECISION MAKING PROBLEM.
• MARKOV ANALYSIS: MARKOV ANALYSIS PERMITS ONE TO PREDICT CHANGES OVER TIME WHEN INFORMATION ABOUT THE BEHAVIOUR OF A SYSTEM IS KNOWN. MARKOV ANALYSIS WHICH IS BASED ON PROBABILITY THEORY, ALLOWS A MANAGER TO DETERMINE SUCH INFORMATION AS FOR PREDICTING FUTURE MARKET SHARES BOTH IN SHORT RUN AND LONG RUN.

• SIMULATION:-SIMULATION IS GENERAL TECHNIQUE THAT ALLOWS US TO DEVELOP A DYNAMIC MODEL THAT ACT LIKE  REAL PROCESS
• DYAN MIC PROGRAMMING:- WHEN WE FACED WITH THE PROBLEM OF MULTIFACETED SOLUTION WHICH ARE INTER RELATED AND ALMOST SIMILAR IN NATURE ,DIFFERING IN TIME AND SPACE LIKE SOLUTION OF SUITABLE PRODUCT MIX,INVENTORY PLANNING CONTROL,REPLACEMENT OF ASSETS,CHOICE OF SHORTEST ROUTE AND SIMILAR OTHER SITUATIONS.
• GOAL PROGRAMMING: CHARLES AND COOPER DEVELOPED THE GOAL PROGRAMMING IN 1961 IN WHICH SEVERAL OBJECTIVES FUNCTIONS ARE CONSIDERED. EACH OBJECTIVE FUNCTION HAS FIXED  VALUE KNOWN AS TARGET AND THE GOAL PROGRAMMING MODELS ARE DEVELOPED TO MINIMIZE DEVIATION FROM THESE TARGETS