Operation research
INTRODUCTION
Literally the word operation is defined as some action
that we apply to problems and the word research is an
organised process of seeking out facts about the
problem.
Operation research is popularly known as O.R.. Is a
recent addition to a long list of scientific tools which
provide a new outlook to many conventional
management problems. It seeks the determination of
best (optimum ) course of action of a decision problem
under the limiting factor of limited resources. Accordingly
O.R. has become a versatile tool in the field of
management and its potential for future is very
substantial.
The aim of O.R :
O.R attempt to locate the best or optimal
solution to the given problem by using the
limited resources (men, machine etc)
According to morse and kimbal
Definition: operation research is a scientific
method of providing executive departments with
a quantitative basis for decision regarding the
operation under their control
Definition: O.R is the attack of modern
methods on complex problems arising in
the direction and management to large
system of men, machines, and money in
industry ,business.
The purpose is to help management to
determine its policy and actions
scientifically and to reach an optimum
solution to the given problem
OR: What is It?
Operations research (also known as
management science) is a
collection of techniques based on
mathematics and other scientific
approaches that finds solutions to
your problems.
The most common problem was: what methods
should we adopted so that the total cost is
minimized (or) total profit is maximized?
Some of the O.R technique are:
1) linear programming problem (L.P.P)
2)transpotation problem (t.p)
3)assignment problem
4)game theory
5)queuing theory
6)simulation
Today the impact of O.R can be felt in many areas. A large no. of
managing consulting firms are currently engaged in O.R activities .
O.R activities includes transportation system ,hospitality, city
planning ,financial institutions etc. Many of the Indian industries
making use of O.R activities are:
Delhi cloth mills ,Indian railways, Indian Airlines ,defense
organizations ,Hindustan lever, tata iron,& steel company, fertilizer
corporation of India
Scope of O.R: In the basic problem in most of the developing
countries in Asia and Africa is to remove poverty and hunger as
quickly as possible .so there is a great scope for economists,
statisticians, administrators , politicians and technicians working in
a team. To solve this problem by an O.R approach.
In agriculture
In agriculture: with the explosion of population
and consequent shortage of food , every country
is facing the problem of
1) optimum allocation of land to various crops in
accordance with the climate conditions and
2) optimum distribution of water from various
resources like canal for irrigation purposes .thus
there is a need of determining best policies
under the prescribed restrictions
In personal management:
A personal manager can use o. r
techniques
1) to appoint the most suitable persons
with minimum salary
2) to determine the best stage of
retirement for the employees
3) to find out the no. of persons to be
appointed on full time basis when the
workload is seasonal ( not continuous)
In industry
In industry: O.R is useful to the industry director
in deciding optimum allocation of various limited
resources such as men, machine, material
,money time etcto arrive at the optimum
decision
Ex: if the industry manager decides his policies
only on the basis of his past experience. If a
heavy lost encountered. That loss compensated
by newly appointed o. r techniques in business
In marketing
In marketing: with the help of o. r techniques a
marketing administrator (manager) can decide
1) where to distribute the products for sale so
that the total transportation cost is minimum.
2)the minimum per unit sale price
3)how to select the best advertising media w.r.to
time and cost
4)the size of the stock to meet the future
demand
5) how? When and what to purchase at a
minimum possible cost
In production management
1)to find out the number and size of the
items to be produced
2) in sheduling and sequencing the
production run by proper allocation of
machines
3) in calculating the optimum product mix.
And
In finance
1)To maximize the per capita income with
minimum resources
2)to find out the profit plan for the
company
3)to determine the best replacement
policies etc
Finally we can say that whenever there is
a problem, the application of o.r cover the
whole extent of anything.
Application of O.R In india
Prof.. Mahalanobis first applied o .r in India
by formulating 2
nd
five year plan with the
help of o .r techniques.
Planning commission made the use of o. r
techniques for planning the optimum size
of caravels fleet of Indian airlines
Role in decision making: O.R model
frequently yield actions that do improve
intutive decision making. sometimes a
situation may be so complicated that the
human mind can never hope to assimilate
all the important factors. without the help
of O.R and computer analysis
Limitations of O.R:
O.r is only a tool of analyzing and not the
complete decision-making process. It
should always be kept in mind that o.r
alone cant make find decision. It is just a
tool and simply suggests best alternatives
but in the final analysis many business
decisions will involve human element.
Thus, o.r is at best a supplement to rather
than a substitute for management.
Linear programming problem
A linear form is meant a mathematical
expression of the type
a1x1+ a2x2 +a3x3+..+ anxn
Where a1 ,a2, a3 are constants
And x1, x2, x3..xn are called variables
The term programming refers to the process of
determining a particular program or plan of
action . So linear programming is one of the
most important optimization
(maximization/minimization) techniques
developed in the field of o.r
