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7/28/2019 Application of Operation Research
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OPERATION
RESEARCH
SUBMITTED BY-
Pryash Singh
MASTERS OF FASHION
MANAGEMENT
SEMISTER-II
NATIONAL INSTITUTE OF FASHION
TECHNOLOGY
NEW DELHI
APPLICATIONS,
ADVANTAGES
& LIMITATIONS OF
O.R
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theory. In addition to this, game theory and simulation can also be used
to find solutions .
APPLICATIONS OF OPERATIONS RESEARCH
The optimization techniques of Operations Research can be used to solve
various real life problems.
1. Defence application:
Defence requires precision and accuracy. Hence it requires scientific
decision making techniques.
Techniques like shortest path problems, scheduling algorithms,
allocation techniques can be used in defence forces.
Basically formulation of OR started from USA army, so it has wideapplication in the areas such as:
development of new technology, optimization of cost and time, tender
evaluation, setting and layouts of defence projects, assessment of “Threat
analysis”, strategy of battle, effective maintenance and replacement of
equipment, inventory control, transportation and supply depots etc.
2. Industrial applications:
An industry or an organization has to manage four areas:Production, marketing, personnel and finance.
Let us see various operational problems that can be applied to these
four areas:
a) Production:
Linear programming for overall production planning
Integer programming for in-depth scheduling
Network based techniques for event management
Inventory control techniques for organizing material arrival and
departure
Replacement analysis for equipment condition study
Queuing theory for deciding on buffer units
b) Marketing:
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Linear programming for product mix problems
For EXAMPLE- advertisement planning
Game theory for tender decisions
Distance network related techniques for transportation of items
c) Personnel:
Linear programming for manpower allocation
Queuing theory for scale of maintenance team required
Scheduling techniques for planning workers
For Example-
Stitching of different parts in sequence to make up a garment
d) Finance:
Integer programming for budgetary planning
Linear programming for break-even analysis
Integer programming for investment options selection
3. Applications in public system:
Operations research can also be employed in public services for more
efficient and scientific approach to the system. Techniques like goal
programming for management policy making and integer
programming for funding can be used. Public enterprises like postal
services can use techniques like vehicle scheduling & manpower planning. Banks need queuing theory for finalizing the number of
counters required. The also need goal programming for banking policy
formulation.
Maintenance or construction works like managing highways requires
integer programming for zeroing in on the optimum project and
finalizing the best contractor for the same, who could implement the
project in the optimum way adhering to all standards. The also need
integer programming for preparing traffic system. Similarly railwaysalso need integer/linear programming but for different requirements
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like cargo loading. The need scheduling techniques for traffic plan,
queuing theory for number of platforms required. The same applies for
airways too. It needs various techniques for simulating the air traffic
and runway design.
Scope of OR is not only confined to any specific agency like defence services
but today it is widely used in all industrial organizations. It can be used to
find the best solution to any problem be it simple or complex. It is useful in
every field of human activities, where optimization of resources is required in
the best way. Thus, it attempts to resolve the conflicts of interest among the
components of organization in a way that is best for the organization as a
whole. The main fields where OR is extensively used are given below, however,
this list is not exhaustive but only illustrative.
(i) National Planning and Budgeting
OR is used for the preparation of Five Year Plans, annual budgets, forecasting
of income and expenditure, scheduling of major projects of national
importance, estimation of GNP, GDP, population, employment and generation
of agriculture yields etc.
(ii) Services & Government
Operation Research (OR) applications can bring benefits in many areas inServices & Government, such as:
Employee Training
The personnel manager of an airline company must decide how many new
flight attendants to hire and train during a certain period. Each flight
attendant can only work up to a certain number of hours a month. Trainees
require a training before they can be put on a flight as regular flight
attendants. During this time a trainee is available for a limited number of
hours a month. Due to limited training capacity, there is a maximum number
of new trainees each month. Throughout the year, flight attendants quit their jobs for a variety of reasons.
(iii) Industrial Establishment and Private Sector Units
OR can be effectively used in plant location and setting finance planning,
product and process planning, facility planning and construction, production
planning and control, purchasing, maintenance management
and personnel management etc. to name a few.
(iv) R & D and Engineering
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Research and development being the heart of technological growth, OR has
wide scope for and can be applied in technology forecasting and evaluation,
technology and project management, preparation of tender and negotiation,
value engineering, work/method study and so on.
(v) Business Management and Competition
OR can help in taking business decisions under risk and uncertainty, capital
investment and returns, business strategy formation, optimum advertisement
outlay, optimum sales force and their distribution, market survey and
analysis and market research techniques etc.
(vi) Agriculture and Irrigation
In the area of agriculture and irrigation also OR can be useful for project
management, construction of major dams at minimum cost, optimumallocation of supply and collection points for fertilizer/seeds and agriculture
outputs and optimum mix of fertilizers for better yield.
(vii) Education and Training
OR can be used for obtaining optimum number of schools with their locations,
optimum mix of students/teacher student ratio, optimum financial outlay
and other relevant information in training of graduates to meet out the
national requirements.
(viii) Transportation
Transportation models of OR can be applied to real life problems to forecast
public transport requirements, optimum routing, forecasting of income and
expenses, project management for railways, railway network distribution, etc.
In the same way it can be useful in the field of communication.
For EXAMPLE-
• School bus routing problem: The objective of the scheduling is to
obtain a bus loading pattern such that the number of routes isminimized, the total distance travelled by all buses is kept at minimum,
no bus is overloaded and the time required to traverse any route does
not exceed a maximum allowed policy.
(ix) Home Management and Budgeting
OR can be effectively used for control of expenses to maximize savings, time
management, work study methods for all related works. Investment of
surplus budget, appropriate insurance of life and properties and estimate of
depreciation and optimum premium of insurance etc.
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DAILY LIFE APPLICATIONS
• In our daily life problems, operations research can be used to arrive at solutions. Let us take the case of determining the best possible option to
reach office. With the help of network optimization we can easily arrive
at the best solution out of the available options.
• Now let us consider the packing of a bag before a trip. We can use
heuristics method, where the big clothes are placed first and then small
things are used to fill the gaps. This will help us to reduce the size of the
bag that we need to carry.
• In the case of preparing for a marriage function, we can make use of
Gantt charts to schedule the various activities to be completed. We candivide the days remaining and allocate time to complete specific
activities such as inviting relatives, purchase, reserving the auditorium,
making arrangements for the reception etc. The Gantt chart can be
used in many other occasions such as preparing for examinations,
interviews etc.
• Another instance when operations research can be used is the buffet
event. We can make use of the queuing theory and arrange the table in
such a way that guests can take food from both the sides. This will
reduce the waiting time by half.• Thus different methods associated with operations research can be
used in our daily life situations to find the optimal solution without
incurring much expense. It reduces cost, effort, time and energy in
finding solutions with conventional methods.
PRACTICAL APPLICATION OF O.R
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LIMITATIONS OF OPERATIONS RESEARCH
OR has some limitations however, these are related to the problem of model
building and the time and money factors involved in application rather then
its practical utility.Some of them are as follows:
(i) Magnitude of Computation. Operations research models try to find out
optimal solution taking into account all the factors. These factors are
enormous and expressing them in quantity and establishing relationships
among these require voluminous calculations which can be handled by
computers.
(ii) Non-Quantifiable Factors. OR provides solution only when all elementsrelated to a problem can be quantified. All relevant variables do not lend
themselves to quantification. Factors which cannot be quantified, find no
place in OR study. Models in OR do not take into account qualititative factors
or emotional factors which may be quite important.
(iii) Distance between User and Analyst. OR being specialist’s job requires
a mathematician or statistician, who might not be aware of the business
problems. Similarly, a manager fails to understand the complex working of
OR. Thus there is a gap between the two. Management itself may offer a lot of resistance due to conventional thinking.
(iv) Time and Money Costs. When basic data are subjected to frequent
changes, incorporating them into the OR models is a costly proposition.
Moreover, a fairly good solution at present may be more desirable than a
perfect OR solution available after sometime. The computational time
increases depending upon the size of the problem and accuracy of results
desired.
(v) Implementation. Implementation of any decision is a delicate task. It
must take into account the complexities of human relations and behaviour.
Sometimes, resistance is offered due to psychological factors which may not
have any bearing on the problem as well as its solution.
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THE ADVANTAGES OF OPERATIONS RESEARCH
The role, importance or advantages of Operations Research (OR) are:-
Picture or Image depicting the Advantages of Operations Research (OR).
1. EFFECTIVE DECISIONS
Operations Research (OR) helps the managers to take better and quicker
decisions. It increases the number of alternatives. It helps the managers to
evaluate the risk and results of all the alternative decisions. So, OR makes the
decisions more effective.
2. BETTER COORDINATION
Operations Research (OR) helps to coordinate all the decisions of the
organization. It coordinates all the decisions taken by the different levels of
management and the various departments of the organisation. For e.g. It
coordinates the decisions taken by the production department with thedecisions taken by the marketing department.
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3. FACILITATES CONTROL
Operations Research (OR) helps the manager to control his subordinates. It
helps the manager to decide which work is most important. The manager
does the most important work himself, and he delegates the less important
work to his subordinates.
Operations Research (OR) helps a manager to fix standards for all the work.
It helps him to measure the performance of the subordinates. It helps the
manager to find out and correct the deviations (difference) in the performance. So, OR facilitates control.
4. IMPROVES PRODUCTIVITY
Operations Research (OR) helps to improve the productivity of the
organisation. It helps to decide about the selection, location and size of the
factories, warehouses, etc. It helps in inventory control. It helps in production
planning and control. It also helps in manpower planning. OR is used in
expansion, modernisation, installation of technology, etc. OR uses many
different mathematical and statistical techniques to improve productivity.
Simulation is used by many organisations to improve their productivity. That is, they try out many productions improvement techniques on a small scale. If
these techniques are successful then they are used on a large scale.
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