Centre for

Continuing Education

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Session conducted by

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Dr Rajesh Gupta

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B Tech, PGDOM, PhD

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Area of interest

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• Operations management

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• Project Management

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• Quantitative Techniques
• Quality Management o. ou
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UPES – The Nation Builders University

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MARKOV PROCESS

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26th February, 2017 o. ou
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Centre for
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UPES – The Nation Builders University

MARKOV ANALYSIS

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Markov analysis is used to analyze the current

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state and movement of a variable to predict the

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future occurrences and movement of this

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variable by the use of presently known

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probabilities.

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Centre for
This study source was downloaded by 100000825856599 from CourseHero.com on 05-14-2021 00:57:28 GMT -05:00 Continuing Education
UPES – The Nation Builders University

TERMS USED

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Market share – The fraction of a population that shops

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at a particular store or market.

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Centre for
This study source was downloaded by 100000825856599 from CourseHero.com on 05-14-2021 00:57:28 GMT -05:00 Continuing Education
UPES – The Nation Builders University

TERMS USED

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State probability – The probability of an event occurring

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at a point in time, say, the

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probability that a person will purchase a product at a

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given store during a given month.

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Centre for
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UPES – The Nation Builders University

TERMS USED

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Transition probability – The conditional probability that

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we will be in a future state given a current state.

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Centre for
This study source was downloaded by 100000825856599 from CourseHero.com on 05-14-2021 00:57:28 GMT -05:00 Continuing Education
UPES – The Nation Builders University

Assumptions of Markov

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Analysis

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The following are the assumptions of Markov analysis as

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applied in business.

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1. The transition probabilities for a given

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beginning state of the system equals one.

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2. The probabilities apply to all system

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participants.
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3. The transition probabilities are constant
over time.
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4. The states are independent over time.

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Centre for
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 UPES – The Nation Builders University

STEADY STATE (Equilibrium)

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 One of the major properties of Markov chains

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is that, in the long run, the process usually

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stabilizes.

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 A stabilized system is said to approach steady

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state or equilibrium when the system’s state
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probabilities have become independent of time.
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Centre for
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