Page 8 - DCOM303_DMGT504_OPERATION_RESEARCH

Unit 1: Introduction to Operations Research

Self Assessment Notes

Multiple Choice Questions:
1. Operations research approach is
(a) Multidisciplinary (b) Scientific

(c) Intuitive (d) All of the above
2. Operations research analysts do not
(a) Predict future operations (b) Build more than one model
(c) Collect relevant data (d) Recommend decision and accept
3. For analyzing a problem, decision makers should normally study its

(a) Quantitative aspect (b) Qualitative aspects
(c) Both (a) and (b) (d) Neither (a) nor (b)

1.3 Scope of Operations Research

Operations Research addresses a wide variety of issues in transportation, inventory planning,
production planning, communication operations, computer operations, financial assets, risk
management, revenue management, and many other fields where improving business
productivity is paramount.
As OR has made (over the years) significant contributions in virtually all industries, in almost
all managerial and decision-making functions, and at most organizational levels, the list of OR
applications is prodigious. Successful OR applications can be found in a broad array of industries
dealing with challenges such as planning, routing, scheduling, forecasting, process analysis and
decision analysis.
OR assists decision-makers in almost any management function. To illustrate, OR supports the
key decision making process, allows to solve urgent problems, can be utilized to design improved
multi-step operations (processes), setup policies, supports the planning and forecasting steps,
and measures actual results.
1. Manufacturing : OR’s success in contemporary business pervades manufacturing and service
operations, logistics, distribution, transportation, and telecommunication.
Operations research is used to for various activities which include scheduling, routing,
workflow improvements, elimination of bottlenecks, inventory control, business process
re-engineering, site selection, or facility and general operational planning.
OR helps in developing software for material flow analysis and design for flexible
manufacturing facilities, using pattern recognition and graph theory algorithms. Further,
approaches for the design of re-configurable manufacturing systems and progressive
automation of discrete manufacturing systems are under development. Additional OR
projects focus on the industrial deployment of computer-based methods for assembly line
balancing, business process reengineering, capacity planning, pull scheduling, and setup
reduction.
2. Revenue Management: The application of OR in revenue management entails
 first to accurately forecasting the demand, and
 secondly to adjust the price structure over time to more profitably allocate fixed
capacity.

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