Lectuie A:

Intiouuction
ur SumeeL CupLa
utline
W ,eanlng and Scope
W naLure of ,anagemenL Sclence
W ueclslon ,aklng and CuanLlLaLlve 1echnlques
W ConcepL of CpLlmlzaLlon
W varlous sLages of an opLlmlzaLlon pro[ecLs
W lleld of AppllcaLlon
eaning anu Scope
W Also known as CperaLlons 8esearch and CuanLlLaLlve Analysls
W used for sclenLlflc declslonmaklng
W ueflnlLlon
W keseotcb of Opetotloos (set of octs tepolteJ fot tbe ocblevemeot
of o JeslteJ ootcome)
W Opetotloos keseotcb ls o scleotlflc metboJ of ptovlJloq execotlve
Jepottmeots wltb o poootltotlve bosls fot Jeclsloos teqotJloq tbe
opetotloos ooJet tbelt coottol
eaning anu Scope
AccounLlng Cash llow plannlng CredlL pollcy analysls AccounLs recelvables lannlng
ConsLrucLlon 8esource allocaLlon Workforce plannlng and deploymenL ro[ecL schedullng monlLorlng eLc
laclllLles plannlng lacLory slze and locaLlon declslon PosplLal plannlng Warehouse locaLlon plannlng
llnance ulvldend pollcy maklng lnvesLmenL analysls orLfollo analysls
,anufacLurlng lnvenLory conLrol roducLlon schedullng and smooLhlng
,arkeLlng AdverLlsemenL budgeL allocaLlon roducL lnLroducLlon Llmlng selecLlon of producL mlx
CrganlzaLlon behavlor ersonal plannlng Schedullng of Lralnlng programs Skllls balanclng 8ecrulLmenL
urchaslng ,aLerlal Lransfer opLlmal buylng opLlmal reorderlng
8esearch and developmenL ConLrol of 8u ro[ecLs roducL lnLroducLlon plannlng
atuie of anagement Science
Fxomple
W ou wlll be Laklng your flnal exam on opLlmlzaLlon meLhods
lnvolvlng say Lwo Loplcs say Llnear rogrammlng and Cueulng
1heory Powever you haven'L done any preparaLlon yeL and lf
you do noL make Lhe besL use of Lhe Llme avallable you may
fall
W LecLure audlos on llnear programmlng are avallable ln compuLer
lab for 8s 30 per hour
W A good LuLor asks 8s 30 per hour of LulLlon on queulng Lheory
W 1he LoLal amounL you have ls 8s 1000
W our capaclLy ls aL besL of 8 hours of lecLure Lapes and 7 hours of
LuLorlng
W ou have only 11 hours of preparaLlon Llme ln nexL Lwo days
now wou/d you decide your choice?
atuie of anagement Science
Fxomple
W 8anl ,ano[ kumar and AnlLa are sLandlng on easL bank of a
rlver and wlsh Lo cross Lo Lhe wesL slde uslng a small boaL 1he
boaL can hold aL mosL Low lndlvlduals aL a Llme ,ano[ belng
Lhe mosL aLhleLlc can cross Lhe rlver ln 1 mlnuLe 8anl kumar
and AnlLa Lake 2 3 and 10 mlnuLes respecLlvely lf Lwo
people are ln a boaL Lhe slower person dlcLaLes Lhe crosslng
Llme 1he ob[ecLlve ls for all four lndlvlduals Lo be on Lhe oLher
slde of Lhe rlver ln Lhe leasL Llme posslble
now wou/d you schedu/e the crossinq the river?
ecision aking anu Quantitative
Techniques
W ,anagemenL Sclence lnvolves declslon maklng under cerLaln
and uncerLaln condlLlons
W 1he manager has Lo choose Lhe mosL effecLlve course of
acLlon ln Lhe glven clrcumsLances ln aLLalnlng Lhe goals of Lhe
organlzaLlon
W varlous declslon maklng slLuaLlons one may encounLer are
W ueclslons under uncerLalnLy (probablllLy can be asslgned Lo
varlous posslble occurrences) or cerLalnLy (where all facLs are
known fully and for sure)
W ueclslons for one Llme perlod only (sLaLlc) or for several Llme
perlods (dynamlc)
W ueclslons where Lhe opponenL ls naLure (eg dlgglng an oll well)
or a raLlonal opponenL (eg compeLlLor)
ecision aking anu Quantitative Techniques
oture onJ Cborocteristics feotures of 0R
ueclslon
,aklng
SclenLlflc
Approach
Cb[ecLlve
lnLer
dlsclpllnary
1eam Approach
ulglLal
CompuLer
Wefloe tbe ptoblem
W5elect Altetootlves
Wetetmloe tbe moJel to be oseJ
Wvoloote oltetootlves ooJ cboose tbe optlmol
Stages in an ptimization Pioject
ueflne Lhe
problem
ConsLrucL
Lhe model
Solve Lhe
model
1esL Lhe
soluLlon
(valldaLlon)
Analyze Lhe
resulLs
lmplemenL
Lhe soluLlon
Stages in an ptimization Pioject
oJel Bevelopment
W ClasslflcaLlon of varlous ,odels
W hyslcal ,odels A physlcal or schemaLlc represenLaLlon of Lhe
real Lhlng
W lconlc Such as maps plcLures drawlngs scaled down models
W Analogue uses one seL of properLles Lo represenL anoLher seL Lg
ConLour models
W Symbollc ,odels uescrlbed uslng symbols or maLhemaLlcal
forms 1hey are Lhe mosL general and absLracL Lypes of models
W verbal 1he perlmeLer (9) of a recLangle ls Lwlce Lhe sum of wldLh
(J) and helghL () of Lhe recLangle
W ,aLhemaLlcal 9 2 (J+ )
Stages in an ptimization Pioject
W ClasslflcaLlon of varlous ,odels
W ,aLhemaLlcal models
W ueLermlnlsLlc All parameLers are flxed and hence no uncerLalnLy
W robablllsLlc (SLochasLlc / Chance) Some or all Lhe baslc
characLerlsLlcs may be random
W 1ypes of varlables ln maLhemaLlcal models
W ueclslon varlables lacLors where a cholce could be made
W 8esulL varlables uependenL varlables LhaL represenL ouLpuL of Lhe
sysLem
W unconLrollable varlables Lrrors and Lhose varlables LhaL are beyond
one's conLrol
W Lxample
W ,arkeL Share f(AdverLlslng budgeL no of Salesman CompeLlLor
sLraLegles)
Stages in an ptimization Pioject
oJellinqof 0R problems
W varlous Lechnlques for solvlng C8 ,odels
W Llnear programmlng lnLeger programmlng uynamlc
programmlng neLwork programmlng nonllnear programmlng
W 1he soluLlon ls derlved Lhrough algorlLhms ln a serles of
lLeraLlons
W lor complex C8 problems lL ls besL Lo seek a good soluLlon
Stages in an ptimization Pioject
oJellinq of 0R problems: 6enerol 0R oJel
ldenLlfy declslon alLernaLlves
,axlmlze or ,lnlmlze ob[ect|ve funct|on
Sub[ecL Lo
Constra|nts
Stages in an ptimization Pioject
oJellinq of 0R problems
W amp|e Conslder formlng a maxlmumarea recLangle ouL of
a plece of wlre of lengLh L lnches WhaL should be Lhe wldLh
and helghL of Lhe recLangle
W Cb[ecLlve ,axlmlze Lhe area of Lhe recLangle
W ueclslon AlLernaLlves lnflnlLe comblnaLlon of wldLh and helghL of
Lhe recLangle
W 8esLrlcLlons
W wldLh 0 helghL 0
W 2 (wldLh + helghL) LengLh 'L'
Stages in an ptimization Pioject
olutions to 0R oJels
W leaslble and lnfeaslble soluLlons
W leaslble Cne whlch saLlsfles all Lhe consLralnLs
W lnfeaslble Cne whlch does noL saLlsfy all Lhe consLralnLs
W CpLlmal and nonopLlmal soluLlons
W CpLlmal 8esL feaslble soluLlons
W nonopLlmal All oLher feaslble soluLlons
W unlque and ,ulLlple soluLlons
W unlque lf Lhere ls only one opLlmal soluLlon
W ,ulLlple When Lhere are more Lhan one opLlmal soluLlons
Stages in an ptimization Pioject
Concept of 0ptimizotion
W SenslLlvlLy Analysls
W ueLermlnaLlon of Lhe behavlor of Lhe sysLem Lo changes ln Lhe
sysLem lnpuLs and speclflcaLlons
W Also known as Jbot lf Analysls
oncept of ptimization
W An opLlmal soluLlon refers Lo Lhe soluLlon whlch maxlmlzes or
mlnlmlzes Lhe ob[ecLlve funcLlon
W ,ore Lhan [usL maLhemaLlcs
W lmporLanL Lo come ouL wlLh slmple soluLlon (Lg of complalnLs
wlLh an elevaLor)
W SoluLlons should Lake human behavlor lnLo accounL
W An C8 sLudy should never sLarL wlLh blas Lowards uslng a speclflc
maLhemaLlcal model before lLs use can be [usLlfled
W CbLalnlng opLlmal soluLlon
W 1he feaslble soluLlons are consldered and Lhe besL among Lhem ls
chosen
W AlgorlLhms may be used for obLalnlng opLlmal soluLlons
W PeurlsLlcs A seL of loglcal rules LhaL yleld an accepLable soluLlon
W SlmulaLlons SoluLlon need noL be opLlmal A glven sysLem ls
soughL Lo be repllcaLed and experlmenLed wlLh
ielu of Application
Scope
uefense
lndusLrlal
AppllcaLlons
ubllc
sysLems
WneLwork Lechnlques for shorLesL paLh
WSchedullng algorlLhms for vehlcle rouLlng
WAllocaLlon Lechnlques for shlpplng food
gralns and ammunlLlon
WAggregaLe plannlng shop floor producLlon
schedullng Llne balanclng and pro[ecL
managemenL lnvenLory conLrol
WroducL mlx deslgns Crder blddlng
declslons
W,anpower plannlng and schedullng
WCaplLal budgeLlng breakeven analysls
porLfollo selecLlon
WCoal programmlng for pollcy declslons
WCueulng Lheory for deLermlnlng number of
counLers
WorLfollo models for effecLlve deploymenL
of funds sub[ecL Lo CovernmenL regulaLlons
W1rafflc sysLem deslgn pro[ecL selecLlon and
vendor selecLlon rallway Lrafflc conLrol
number of plaLforms