Page 27 -

MANAGEMENT SCIENCE APPLICATIONS 7

put on hold because the phone network couldn’t cope with demand. MS techniques
are applied to examine network flows – how quickly and efficiently things flow, or
move, through the network.

Optimization
Organizations are frequently looking for the best, or optimal, solution to a
decision problem they have. How do we maximize profit from our sales? How
do we minimize production costs? What is the optimum size for our workforce?
In the search for such an optimum solution, organizations will not have a totally
free hand in deciding what to do. Typically they will face certain restrictions or
constraints on what they are able to do. An organization seeking to maximize
profit from sales may face constraints in terms of its production capacity, or the
finite demand for its products. A company seeking to minimize production costs
may be locked into long-term supply contracts with some of its customers and is
constrained to meet these contract requirements. An organization looking to
determine the optimum size of its workforce may have certain health and safety
requirements to meet. MS has developed a number of different techniques for
dealing with such optimization problems.

Project Planning and Management
All organizations need to be able to plan and manage projects effectively. The
project may be relatively small involving few resources and capable of being com-
pleted fairly quickly – organizing the move of a team from one part of the office to
another – or it may be large and complex with a large budget and requiring
considerable time and effort – planning the 2016 Rio de Janeiro Olympics. Once
again, MS has developed techniques to allow for the efficient and effective planning
and management of projects.

Queuing

We’ve all been in one at some time – a queue. It may have been a queue at a
supermarket while we’re waiting at the checkout; or a queue of cars at a traffic
signal; or a queue of print jobs at the network printer. Queues are frustrating for
those affected but are also difficult to manage cost-effectively. Putting extra staff on
the supermarket checkout may well reduce the time customers spend queuing but
this will also increase the supermarket’s operating costs, so some compromise will be
needed. MS uses queuing theory to examine the impact of management decisions on
queues.

Simulation
It’s not usual in business and management to be able to experiment before making a
major decision. For example, we may be considering a major alteration to our
production lines to boost productivity. We may be thinking about altering an air-
line’s global flight timetable to increase competitiveness and market share. We may
be thinking about redeploying police patrol vehicles to help tackle crime. It’s
unlikely that we would in practice be able to experiment and try different solutions
to see what happened, although most managers would like to be able to do so, to
assess the likely consequences of alternative decisions. However, whilst we can’t
experiment in the real world we can experiment using computer modelling known as
simulation. Computer simulation involves running virtual experiments so that the
consequences of alternative decisions can be analyzed.

Copyright 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s). Editorial review has
deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.