Quantitative Management
Quantitative Techniques/Operations Research
Successful managers use quantitative techniques in decision making when: 1. The problem is complex. 2. The problem involves many variables. 3. There are data which describe the decision environment. 4. There are data which describe the value or utility of the different possible alternatives. 5. The goals of the decision maker or the organization can be described in quantitative terms. 6. Workable models are available for these situations.
Six steps towards making better decisions:
Process Activities Process Steps Process Output
1. Site visits Observe the problem Sufficient information Conferences environment and support to proceed Observation Research
2. Define use Analyze and define Clear grasp of need for Define objectives and nature of solution Define limitations requested
3. MS/OR tools Develop a model Model that works under Interrelationships identified limitations Mathematical models Known solutions Research
4. Internal/external data Select appropriate data Sufficient inputs to Facts input operate and test model Opinions Computer data banks
5. Testing Provide a solution and Solution(s) that support Limitations test its reasonableness current organizational Verification objectives
6. Behavioral issues Implement the solution “Ownership” by management “Selling” the idea sufficient to support longer Management involve- run/operation of model ment Explanations
Roles of quantitative specialist and managerial generalist/decision maker:
Steps in Problem Recognition, Involvement: Quantitative specialist
Formulation & Solution or managerial generalist
1. Recognize from organizational Managerial generalist symptoms that a problem exists.
2. Decide what variables are Managerial generalist &
Successful managers use quantitative techniques in decision making when: 1. The problem is complex. 2. The problem involves many variables. 3. There are data which describe the decision environment. 4. There are data which describe the value or utility of the different possible alternatives. 5. The goals of the decision maker or the organization can be described in quantitative terms. 6. Workable models are available for these situations.
Six steps towards making better decisions:
Process Activities Process Steps Process Output
1. Site visits Observe the problem Sufficient information Conferences environment and support to proceed Observation Research
2. Define use Analyze and define Clear grasp of need for Define objectives and nature of solution Define limitations requested
3. MS/OR tools Develop a model Model that works under Interrelationships identified limitations Mathematical models Known solutions Research
4. Internal/external data Select appropriate data Sufficient inputs to Facts input operate and test model Opinions Computer data banks
5. Testing Provide a solution and Solution(s) that support Limitations test its reasonableness current organizational Verification objectives
6. Behavioral issues Implement the solution “Ownership” by management “Selling” the idea sufficient to support longer Management involve- run/operation of model ment Explanations
Roles of quantitative specialist and managerial generalist/decision maker:
Steps in Problem Recognition, Involvement: Quantitative specialist
Formulation & Solution or managerial generalist
1. Recognize from organizational Managerial generalist symptoms that a problem exists.
2. Decide what variables are Managerial generalist &