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Table of Contents

HISTORY ............................................................................................................................................... 2 METHODOLOGY .................................................................................................................................. 3 MATHEMATICAL PROGRAMMING ..................................................................................................... 4 STOCHASTIC PROCESSES ................................................................................................................... 4 OR TECHNIQUES ................................................................................................................................. 4 THEORY OF REPLACEMENT ............................................................................................................... 5 OPERATIONAL RESEARCH IN PRACTICE .......................................................................................... 5 SCOPE OF APPLICATION .................................................................................................................... 6 ADVANTAGES....................................................................................................................................... 6 LIMITATIONS........................................................................................................................................ 7 REFERENCES ....................................................................................................................................... 7

INTRODUCTION Operations research, or Operational Research in British usage 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. The terms management science and decision science are sometimes used as more modern-sounding synonyms. A decision-making problem occurs where there are two or more alternative courses of action, each of which leads to a different and sometimes unknown end result. Operations research is also used to maximize the utility of limited resources. The objective is to select the best alternative, that is, the one leading to the best result. India was one of the first few countries who started using OR. In 1949, the first OR unit was established in the Regional Research Laboratory at Hyderabad. Today, OR is a popular subject in management, mechanical engineering and the mathematics. HISTORY The ambiguous term Operations Research (OR) was coined during World War II, when the British Military Management called upon a group of scientists together to apply a scientific approach to the study of military operations to win the battle. Operations Research originated in Great Britain during World War II to bring mathematical or quantitative approaches to bear on military operations. The main objective was to allocate the scarce resources in an effective manner to the various military operations and to the activities within each operation. The effectiveness of operations research in military spread in it to other government department and industry. Due to the availability of faster and flexible computing facilities and the no. of qualified O.R. professionals, it is now widely used in military, business, industry, transportation, public health etc. Since its birth in the 1940's, OR has been widely recognized as an important approach to decision-making in the management of all aspects of an organization. Computer revolution helped OR as the problems in computation was enormous and required a tool strong enough to handle complexity .Electronic and Digital calculation gave way to a school of thought which was beyond manual calculation. Further the growth of OR was boosted at every step of computer growth. Today, OR solutions are available as softwares which are customised according to necessity and demand. Many legacy systems use these as a calculation engine which gives accurate result on providing the inputs.

Two factors that helped boost the growth of OR is this research in techniques and the computer revolution. Many theories and methods like the simplex method (developed by George Dantzig in 1947), and many crucial tools of OR like linear programming, dynamic programming, queuing theory and inventory theory were relatively well developed by 1950. METHODOLOGY The success of operations research, where there has been success, has been the result of the following six simply stated rules: (1) formulate the problem (2) construct a model of the system (3) select a solution technique (4) obtain a solution to the problem (5) establish controls over the system (6) implement the solution. The first statement of the problem is usually vague and inaccurate. It may be a cataloging of observable effects. It is necessary to identify the decision maker, the alternatives, goals, and constraints, and the parameters of the system. A statement of the problem properly contains four basic elements that, if correctly identified and articulated, greatly eases the model formulation. These elements can be combined in the following general form: Given (the system description), the problem is to optimize (the objective function), by choice of the (decision variable), subject to a set of (constraints and restrictions). In modeling the system, one usually relies on mathematics, although graphical and analog models are also useful. It is important, however, that the model suggest the solution technique, and not the other way around. With the first solution obtained, it is often evident that the model and the problem statement must be modified, and the sequence of problem-modeltechnique-solution-problem may have to be repeated several times. The controls are established by performing sensitivity analysis on the parameters. This also indicates the areas in which the data-collecting effort should be made.

Implementation is perhaps of least interest to the theorists, but in reality it is the most important step. If direct action is not taken to implement the solution, the whole effort may end as a dust-collecting report on a shel MATHEMATICAL PROGRAMMING Probably the one technique most associated with operations research is linear programming. The basic problem that can be modeled by linear programming is the use of limited resources to meet demands for the output of these resources. This type of problem is found mainly in production systems, but is not limited to this area. Generally speaking, a mathematical optimization model has the following typical components: a set of decision variables an objective function, expressed in terms of the decision variables, that is to be minimized or maximized a set of constraints that limit the possible values of the decision variables . STOCHASTIC PROCESSES A large class of operations research methods and applications deals with stochastic processes. These can be defined as processes in which one or more of the variables take on values according to some, perhaps unknown, probability distribution. These are referred to as random variables, and it takes only one to make the process stochastic. In contrast to the mathematical programming methods and applications, there are not many optimization techniques. The techniques used tend to be more diagnostic than prognostic; that is, they can be used to describe the healthof a system, but not necessarily how to cure it. OR TECHNIQUES
Linear programming It has been used to solve problems involving assignment

of jobs to machines, blending, product mix, advertising media selection, least cost diet, distribution, transportation and many others.
Dynamic programming It has been applied to capital budgeting, selection of

advertising media, cargo loading and optimal routing problems.


Waiting line or queuing theory It has been useful to solve problems of traffic

congestion, repair and maintenance of broken-down machines, number of service facilities, scheduling and control of air-traffic, hospital operations, counter in banks and railway booking agencies.

Inventory control / planning These models have been used to determine

economic order quantities, safety stocks, reorder levels, minimum and maximum stock level.
Decision theory It has been helpful in controlling hurricuanes, water pollution,

medicine, space exploration, research and development projects.


Network analysis (PERT& CPM) These techniques have been used in planning,

scheduling and controlling construction of dams, brides, roads and highways and development & production of aircrafts, ships, computers etc.
Simulation It has been helpful in a wide variety of probabilistic marketing

situations. THEORY OF REPLACEMENT It has been extensively employed to determine the optimum replacement interval for three types of replacement problems: i) Items that deteriorate with time. ii) Items that do not deteriorate with time but fail suddenly. iii) Staff replacement and recruitment. OPERATIONAL RESEARCH IN PRACTICE Operational research is spread across various streams and domains like manufacturing, transportation, construction, telecommunication, financial planning , health care , military and public services. The term management sciences is used as a synonym for Operational research. Research is also done extensively in OR. The process begins by carefully observing and formulating the problem including formulating the relevant problem. The next step is to fit the problem in a scientific model as per the nature. A hypothesis is formulated that the designed model is sufficient and precise representation of the features of the real problem in hand. Suitable experiments are conducted to prove the validity of the hypothesis. Based on the experiments, design may be modified and then test for the validity of the hypothesis. Operational Research requires creative scientific research the fundamental properties of operation. OR, as discussed earlier, also deals with practical management. OR also has a broad point of perspective to all the factors involved and leaves behind the myopic

approach to any specific factor. Also, the best solution is obtained unlike in mathematical analysis where a range of feasible solution may be obtained. Operation Research is generally done by a team of statistician, mathematician and Engineers or a collection of all the concerned teams. The team also needs to have the necessary experience and variety of skill to give appropriate consideration to the necessary areas of the problem. SCOPE OF APPLICATION There are numerous areas where operations research has been applied. The following list is not intended to be all-inclusive, but is mainly to illustrate the scope of applications: optimal depreciation strategies; communication network design; computer network design; simulation of computer time-sharing systems; water resource project selection; demand forecasting; bidding models for offshore oil leases; production planning; classroom size mix to meet student demand; optimizing waste treatment plants; risk analysis in capital budgeting; electric utility fuel management; optimal staffing of medical facilities; feedlot optimization; minimizing waste in the steel industry; optimal design of naturalgas pipelines; economic inventory levels; optimal marketing-price strategies; project management with CPM/PERT/GERT; air-traffic-control simulations; optimal strategies in sports; optimal testing plans for reliability; optimal space trajectories ADVANTAGES Provides a tool for scientific analysis. Provides solution for various business problems. Enables proper deployment of resources. Helps in minimizing waiting and servicing costs. Enables the management to decide when to buy and how much to buy? Assists in choosing an optimum strategy. Renders great help in optimum resource allocation.

Facilitates the process of decision making. Management can know the reactions of the integrated business systems. Helps a lot in the preparation of future managers. LIMITATIONS The inherent limitations concerning mathematical expressions High costs are involved in the use of O.R. techniques O.R. does not take into consideration the intangible factors O.R. is only a tool of analysis and not the complete decision-making process Other limitations Bias Inadequate objective functions Internal resistance Competence Reliability of the prepared solution

REFERENCES http://www.doc.ic.ac.uk/~br/berc/linearprog.pdf http://www.orms-today.org/classifieds/ http://www.scienceofbetter.org/what/index.htm