Operational Research Operational Research is a discipline that deals with the application of advanced analytical methods to help make

better decisions. it is often considered to be a sub-field of Mathematics Roots of OR The roots of Operations Research can be traced back to many decades when attempts were made to use a scientific approach in the management of organization. The beginning of activity called operations research has generally been attributed to the military services early in World War II Because of the war effect there was an urgent need to allocate scarce resources to the various military operations and to the activities in an effective manner British and US military management called upon a large number of scientists to apply a scientific approach to dealing with this and other strategic tactical problems. In effect they were asked to do research on the operation. These scientists were the first OR teams. The success of OR in the war effort spurred interest in applying OR outside the military as well. The same problems faced in military in different context in business was applied by the same team in early 1950s. The rapid spread of OR soon followed. Second factor that gave great impetus to the growth of the field was the onslaught of computer revolution. Large complex calculations that could not have been done by humans due to time and resource constraints which computers were able to perform quickly was a boon to OR Further boost came in the 1980s with the development of personal computers accompanied by software packages.

Characteristics of Operations Research This science is basically concerned with optimizing maxima and minima of the objective functions involved. Examples of maxima could be profit, performance and yield. Minima could be loss and risk

Decision Making Operations Research (OR) helps the managers to take better and quicker decisions. It increases the number of alternatives. It helps the managers to evaluate the risk and results of all the alternative decisions. So, OR makes the decisions more effective.

Scientific Approach OR extensively uses scientific means and methods to solve problems. Most OR studies cannot be conducted in laboratories, and the findings cannot be applied to natural environments.

Inter disciplinary team approach The team performing the operational research is drawn from different disciplines. The disciplines could include mathematics, psychology, statistics, physics, economics and engineering. The knowledge of all the people involved aids the research and preparation of the scientific model.
System approach OR attempts appraise the effect the changes of any

single part would have on the performance of the system as a whole.

Use of Computers: the use of computer modelling and the simulation of

business processes as a means of improvements in the way that things are done within an organisation. The tasks that OR examines are complex and involve many variables. They include things like designing an optimal telecommunications network in a situation where future demand is uncertain, or automating a paper-based bank clearing system.

Scope of Operations Research

National Planning and Budgeting Defense Services Industrial Establishments and Private Sector Units R&D Engineering Business Management and Competition Agriculture and Irrigation Education and training Home Management and budgeting

Models in OR Linear Programming Waiting line or Queuing theory Game Theory Inventory control Models Simulation Non Linear Programming Integer Programming Sequencing Theroy Networking-PERT, CPM

Impact of Operations Research Impressive impact on improving the efficiencies of the organizations around the world. Significant contribution to increasing the productivity of the economies of the various countries. Internationally recognized OR groups. INFORMS- Institute for Operations Research and the Management Sciences IFORS- International federation of Operation research societies.

Some of the companies benefited from OR Federal Express Continental airlines Swift & Company United Airlines Welchs Samsung electronics Procter & Gamble U.S.Military Taco Bell Air New Zealand Merrill Lynch AT&T

Advantages of Operations Research (OR) Effective Decisions

Operations Research (OR) helps the managers to take better and quicker decisions. It increases the number of alternatives. It helps the managers to evaluate the risk and results of all the alternative decisions. So, OR makes the decisions more effective.

Better Coordination
Operations Research (OR) helps to coordinate all the decisions of the organisation. It coordinates all the decisions taken by the different levels of management and the various departments of the organisation. For e.g. It coordinates the decisions taken by the production department with the decisions taken by the marketing department.

Facilitates Control
Operations Research (OR) helps the manager to control his subordinates. It helps the manager to decide which work is most important. The manager does the most important work himself, and he delegates the less important work to his subordinates. Operations Research (OR) helps a manager to fix standards for all the work. It helps him to measure the performance of the subordinates. It helps the manager to find out and correct the deviations (difference) in the performance. So, OR facilitates control.

Improves Productivity
Operations Research (OR) helps to improve the productivity of the organisation. It helps to decide about the selection, location and size of the factories, warehouses, etc. It helps in inventory control. It helps in production planning and control. It also helps in manpower planning. OR is used in expansion, modernisation, installation of technology, etc. OR uses many different mathematical and statistical techniques to improve productivity. Simulation is used by many organisations to improve their productivity. That is, they try out much production improvement techniques on a small scale. If these techniques are successful then they are used on a large scale.

Limitations of OR 1. 2. 3. 4. 5. Magnitude of computation Non quantifiable factors Distance between user and analyst Time and cost Implementation

Steps involved in formulating an OR model

1. 2. 3. 4. 5. 6.

Defining the problem and gathering Data, Formulating a Mathematical Model Deriving solutions from the model. Testing Preparing to apply the Model Implementation

Linear Programming Problems (LPP) LPP in general are concerned with the allocation of the resources (i.e. labor, material, machinery, capital) in the best possible manner so that the cost are minimized and profits are maximized. In using the term best it is implied that some choice of alternative courses of action are available for making decision. In general the best decision is found by solving mathematical models. The linear function which is to be optimized is called objective function. The conditions are referred to as constants. Linear ties employs both the proportionalities and additives properties required the contibution of each variable in the objective function or its usage of resources directly proportional to the level of variable. Additive requires that the objective function be the direct sum of individual constraints of different variables. Formulation of Linear Programming 1. Identify the unknown variables to be determined and report them in terms of algebraic symbols. 2. Identify all the restrictions or constraints in the problem and express them as the linear equation or inequalities which are linear functions of variables. 3. identify the objective and report it as linear function of decision variable which is to be maximized or minimized.