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# what is operation research?

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## isma liana

on 28 October 2013

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#### Transcript of what is operation research?

INTRO : OPERATION RESEARCH
What is operation research (OR)?

OR is the scientific approach to managerial decision making.

The Advantages of using OR in Problem Solving
1. Problem is solved using scientific method, there is a logical and systematic approach to solving problem.

2. Most solutions obtained are optimal solution.

3. Save time if the problem is repetitious.

1. Models can accurately represent reality. If properly formulated, a model can be extremely accurate.
2. Models can help a decision maker formulate problems.
3. Models can give us insight and information.
4. Models can save time and money in decision making problem solving.
5. A model may be the only way to solve some large or complex problems in a timely fashion.
6. A model can be used to communicate problems and solutions to others.

Mathematical Models Categorized by Risk
There are two types of model:
1. Deterministic model – all input variables are known and have constant values (not involved chance and risk).
For example: the EOQ model in inventory control.
2. Stochastic model – at least one input variable is uncertain and with value that varies. Also known a probabilistic models (involves chance and risk).
For example: simulation model using Monte Carlo method

In QMT337,

• Probabilistic technique - Decision Theory, Queuing Theory, Simulation
• Linear Programming technique – Graphical and Simplex Method, Transportation
• Network technique – Project Management
• Other technique – Inventory

Operations research involves the application of mathematical method to develop a model and then to develop a solution.
The techniques have been applied successfully in many areas such as business, government, health care, education, bank and etc.
Operations research also referred to as quantitative analysis, quantitative method, management science and decision science.
History of OR:
 First formal activities were initiated in England during World War II.
 A team of British scientists set out to make a decision regarding the best utilization of war material.
 Following the end of the war, the ideas advanced in military operations were adapted to improve efficiency and productivity in the civilian sector.

Major reason for the growth in the use of OR since World War II.
 The development of numerous OR methods due to continued research.
 Advancement in computing power through digital computers.

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