Podcast
Questions and Answers
What is one common pitfall that MS/OR specialists might fall into?
What is one common pitfall that MS/OR specialists might fall into?
- Forgetting to use linear programming for all decisions
- Relying solely on heuristics for decision-making
- Always building complex solutions that are difficult to understand
- Neglecting to integrate judgment and intuition with the models they build (correct)
Why do many 'real world' problems not have MS/OR solutions?
Why do many 'real world' problems not have MS/OR solutions?
- Because managers prefer heuristic-based solutions
- As a result of forgetting to include constraints
- Due to the limitations of MS/OR models (correct)
- Because managers assign incorrect values to constraints
What is a key characteristic of a good MS/OR solution?
What is a key characteristic of a good MS/OR solution?
- Being behaviorally appropriate (correct)
- Having a high reliance on heuristics
- Being complex and difficult to explain
- Being built without considering economic viability
Why do managers need to be counseled on the limitations of MS/OR models?
Why do managers need to be counseled on the limitations of MS/OR models?
Which method involves creating a sequence of interdependent activities?
Which method involves creating a sequence of interdependent activities?
What is one characteristic of a reliable MS/OR solution?
What is one characteristic of a reliable MS/OR solution?
Which method is commonly used to handle uncertainty in decision-making processes?
Which method is commonly used to handle uncertainty in decision-making processes?
What role does judgment play in the effective use of MS/OR models?
What role does judgment play in the effective use of MS/OR models?
Why is it important for managers to understand the limitations of MS/OR models?
Why is it important for managers to understand the limitations of MS/OR models?
Which type of problems might not have a suitable MS/OR solution?
Which type of problems might not have a suitable MS/OR solution?
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Study Notes
MS/OR and the Computer
- Organizations have turned to computers to provide data due to the complexity and scope of managerial decision-making, as the benefits/cost ratio of using computers is overwhelmingly in favor.
- Manual methods are no longer viable for providing data.
Decision Support System (DSS)
- A DSS is a computer-based information system designed to support decision-making processes within an organization.
- The primary purpose of a DSS is to provide relevant information and analytical tools to help decision-makers make more informed and effective decisions.
- Characteristics of a DSS:
- Quick access to information for decision-making
- Integration of MS/OR models with computer tools
- Flexible databases for versatile information storage
- Assistance in addressing unstructured problems not fully solvable by individual models or information systems reports
- Enhances the impact of management decisions by extending managerial capabilities
- Allows incorporation of intuition and judgment at all decision-making stages
Role of Human and Computer
- Human decision makers:
- Have creative powers
- Can learn from experiences
- Can see the overall complex problem
- Have an enormous memory
- Have flexibility
- Computers:
- Can follow rules
- Are not always accurate
- Can be programmed to follow rules
- Have enormous memory
- Never forget
- Have flexibility
Classification of Management Information Systems
- Classification by processing method:
- Batch Processing
- Real-Time Processing
- Online Processing
- Timesharing
- Distributed Data Processing
- Classification by type of output provided:
- Management Information System that generates reports
- Management Information System that answers "what-if" kind of questions asked by management
Opportunities and Shortcomings of the Quantitative Approach
- Shortcomings:
- MS/OR specialists may forget to counsel managers on the limitations of the models they build
- Managers may forget to include an important constraint or assign an incorrect value to a constraint
- Many MS/OR solutions are difficult to explain to managers
- Some "real-world" problems do not have an MS/OR solution
Good MS/OR Solution
- A good MS/OR solution should:
- Be technically appropriate
- Be reliable
- Be economically viable
- Be behaviorally appropriate
Quantitative Methods to be Discussed
- Probability Concepts Review
- Forecasting
- Decision Theory
- Inventory Models
- Linear Programming
- Special-Purpose Algorithms
- Integer Programming, The Branch And Bound Method
- Dynamic Programming, Goal Programming
- Heuristics
- Simulation
- Queuing Theory
- Network Scheduling
- Markov Analysis
- A Look Ahead
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